Mortgage lending remains stable

Posted: 30 Aug 2007 11:59:56 GMT

Mortgage approvals in July remained strong despite recent interest rate rises.

Mortgage approvals in July remained strong despite recent interest rate rises.

The Bank of England has published its lending figures for the month which reveal that 115,000 loans for house purchase were approved.

This figure matches that recorded in June and remains well above the average for the last decade of 105,000.

Remortgaging activity appeared to be down between the months, from 103,000 approvals in June to just 101,000 in July.

Commenting on the figures, Vicky Redwood from Capital Economics said that demand for mortgages is affecting house prices positively.

"The strength of mortgage demand probably explains why there has been only a slight softening in house price inflation - the Nationwide index posted a solid 0.6 per cent monthly rise in August," she said.

Nationwide revealed that prices grew by 0.6 per cent month-on-month in August, up from 0.1 per cent in July.

However, annual inflation was down between the months, from 9.9 per cent in July to 9.6 per cent in August.

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