UK mortgage lending up 5% in October 2009

Signs of recovery in the UK property market are appearing after October figures showed a 5% rise gross mortgage lending.

October 2009 gross mortgage lending was an estimated £13.5bn ($24.4bn), up from £12.9bn in September 2009. However, this is still 27% down on the £18.5bn lent in October 2008, according to the latest figures from the Council of Mortgage Lenders (CML).

This comparison with last year should start to improve due to the sharp decline in lending volumes towards the end of 2008 and early 2009, the CML said.

The latest figures are in line with gross annual lending predictions of £141bn for 2009.

Paul Samter, economist at the CML, said "house purchase activity has picked up significantly. In contrast, remortgaging has dropped to decade-low levels as many borrowers have little incentive to refinance when they move onto low reversion rates, and others find themselves unable to do so due to equity constraints."

He said the coming months were likely to be dominated by seasonal factors rather than underlying change.