Mortgage lending in the UK picked up in September to reach its highest level since May, while the value of approvals was near a 2-year peak, figures from the Bank of England showed today.
Mortgage lending during September rose by 7.7 bln stg, up from a rise of 7.6 bln the previous month, but a touch lower than the 7.9 bln stg increase forecast.
Meanwhile, the number of approvals for house purchases -- which are often seen as a good indicator of future demand in the property sector -- jumped to 107,000, the highest level since June 2004, but again slightly below expectations of 110,000.
The total value of mortgage approvals -- which also includes remortgaging -- rose to 27.0 bln stg, up from 25.9 bln in August. The September figure is the highest since November 2003.
Within that, the value of approvals for house purchases rose by 13.2 bln stg from 12.7 bln stg in August. The latest reading is the highest since May 2004.
The news adds to growing evidence that the housing market is starting to pick up gradually in the wake of the Bank of England's decision to cut interest rates in August for the first time in over two years.
A series of mortgage lending data including figures from the British Bankers Association have all suggested that the property market has stabilised and may in fact be on the up again.
The data will also weigh against the case for an interest rate reduction in the coming months.
Elsewhere within today's release, the central bank found that net new consumer credit remained subdued, rising by just 1.2 bln stg in September, in line with predictions and a touch lower than the 1.3 bln increase the previous month.
Overall total lending, which combines lending on dwellings and consumer credit, rose by 9.0 bln stg during September, up from the 8.9 bln stg recorded in August. The latest reading is the highest since May this year.