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Record UK mortgage lending for June but card lending dips – BBA

June's gross mortgage lending of GBP20.5 billion was the highest on record, 12% above the outturn for May and 24% higher than June last year, according to figures from the British Bankers' Association.

Seasonally adjusted underlying net mortgage lending (gross lending minus repayments and redemptions) rose by GBP5.6 billion, compared with GBP5.8 billion in May, GBP4.7 billion in June 2005 and an average of GBP5.3 billion over recent months.

There were 212,768 mortgage approvals (for all purposes) in June, with a total value of GBP22.1 billion. Overall approvals were 9% higher than in June 2005 but 9% lower than in June 2004. The average approval for house purchase fell in June to GBP137,700, only some 5% higher than a year earlier.

Net lending on loans and overdrafts rose by GBP0.2 billion in June, compared with an increase of GBP0.7 billion in May and an average rise over the previous six months of GBP0.4 billion. In contrast, underlying net lending on credit cards fell by GBP0.2 billion, compared with a fall of GBP0.3 billion in May.

David Dooks, BBA director of statistics, said that while gross mortgage lending reached record levels in June, numbers of approvals though stronger than in mid-2005 were weaker than at the equivalent time in either 2003 or 2004.

The relatively strong retail sales reported for June do not seem to have been reflected in consumer credit lending which has continued to show the weakness, particularly in credit card borrowing, which has been apparent for most of this year, he added.