Gross mortgage lending up 24% in May

CML chief economist Bob Pannell said: "The Government has recently announced a number of measures to counter the adverse effects from the euro zone crisis. It clearly senses an opportunity to bolster home ownership and housing activity, and we look forward to hearing more details about the ‘funding for lending’ initiative which seeks to deliver this.

"Meanwhile, mortgage lending continues to seesaw, albeit against a broadly flat market. Unfortunately, a number of one-off factors, such as the Diamond Jubilee and the Olympics, are set to distort market indicators over the coming months, and it may be the autumn before we can more accurately gauge the state of the market."

David Newnes, Director of LSL Property Services said: “On an annual basis, lending has been impressively buoyant in the face of the ever-escalating eurozone crisis and a recession in the UK. Buyers retain a strong underlying demand for property which along with a positive approach by mortgage lenders has mitigated the impact of the return of stamp duty.

“According to our latest house price index, property transactions rose to 60,000 in May and overall house prices increased by 1.9%. This is an indicator of the resilience of the market and the willingness of lenders to be proactive has been crucial in overcoming the economic gloom. Despite this, the number of first time buyers is still historically low and it’s proving very tough for first time buyers to leave the rental market due to the need for large deposits to obtain mortgage finance.”

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