This is almost identical to July’s gross lending total of £16.7 billion and is 28% higher than August last year (£13 billion).
In today’s CML market commentary, CML chief economist Bob Pannell comments:
"We are beginning to experience a healthy and broad-based recovery in mortgage lending activity. We attribute much of this turnaround to the improvement in funding markets generally, and also to the Funding for Lending Scheme. The Bank of England’s approvals data suggests that the positive tone for house purchase and remortgage lending will continue.
"One tell-tale sign of a recovering housing market is the re-emergence of concerns about a housing boom… But, as we have argued elsewhere, the housing market recovery to date appears fairly unexceptional in nature, at least compared with that of the early-mid 1990s."
Sophie Hall, Head of Intermediary at Avelo, comments:
“The mortgage market has been roaring back into life, and these monthly figures represent lending pausing for breath rather than a premature end to the recent recovery. In reality, first-time buyers are still flocking to the market in their droves. A combination of rock-bottom rates caused by Funding for Lending, and the added assistance of Help to Buy will see demand go from strength to strength in the latter part of 2013.
“However, as mortgage brokers benefit from a booming mortgage market, they must not overlook mortgage protection. The proportion of mortgage sales with mortgage protection is dropping. Given how vital protection is for customers’ long term security, it is crucial brokers do not take their eye off the ball and revert to their pre-credit crunch approach.”
Jonathan Harris, director of mortgage broker Anderson Harris, says:
"Surprisingly, given all the talk of an overheating housing market, gross mortgage lending was steady in August compared with July. This is extremely encouraging, suggesting a sustained and considered improvement in the housing market, which is more likely to lead to a measured recovery, rather than a house-price bubble.
"Swap rates have fallen again in the past week so while a few lenders have raised or simply withdrawn their longer-term fixed rates, borrowers shouldn't panic about a sudden surge in pricing on fixed rates. If you see a rate you like, go for it but don't fret too much if you plan to buy or remortgage in a few months' time. Most lenders will let you reserve rates for up to six months so borrowers can do this if they still have concerns.
"The economy is turning a corner but let's not get too carried away: there is still a long way to go. The danger of over-reaction to a house-price bubble is that any confidence in the market is extinguished just as it is establishing itself. Lending volumes and house prices are still well below pre-crisis levels."
