Mortgage Lending in May

The number of new mortgages arranged in May fell despite an increase in the number of new loans for house purchase. Overall, the amount of money lent to homeowners increased, but at a much slower rate than in April. The purchase figures support the view of both estate agents and surveyors that there has been a noticeable increase in the number of potential buyers, and of property sold, and this in turn seems to have helped halt the slide in house prices. Whether this can be sustained nobody knows but with the Office for National Statistics reporting the biggest decline in the economy for 51 years over the first quarter of 2009, we are far from out of the woods. Remortgage numbers fell for the third month in a row, but with fixed rates increasing recently we may see this trend reversed once the June figures are released, as borrowers look to guard against the eventual rise in bank rate.

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