May rise in Mortgage lending Friday, 2nd July 2010

According to the British Bankers' Association (BBA), mortgage lending continued rising in May.

So far this year, the number of mortgages approved for house purchases rose to its highest level.

For people buying a property during the month, a total of 36,709 loans were approved by the major banks.

However for the past three months, figures from HM Revenue & Customs (HMRC) show that completed property sales have been flat.Sales in May stood at 73,000, just 1,000 up on the number sold in both March and April.

The figures mean that sales so far this year are still running at less than half the level recorded in the same period during 2006, 2007 or 2008, though higher than a year ago.

It was the third month in a row of rising mortgage approvals, The BBA, whose members account for 75% of new mortgage lending, said. Households continue to pay off debts, according to the BBA. "The low interest rate environment is resulting in customers choosing to reduce or pay off borrowing, particularly personal loans, rather than saving," said the BBA's director of statistics, David Dooks.

Re-mortgaging accounted for the lion's share of loan approvals with 24,626 taking out new or replacement loans on their existing property.