A recent report has shown that there was a slight upturn in mortgage lending for the month of July, with mortgage lending levels said to have risen by 5%. Mortgage lending levels have been in decline for some months as a result of the global credit crunch which has seen a reduction in mortgage products on the market, as well as resulting in lenders putting far tighter lending criteria into place. In addition to this falling house prices and the threat of negative equity coupled with lack of affordability has resulted in fewer people making mortgage applications.

Compared to the mortgage lending levels for June there was a 5% rise in lending levels in July according to the recent figures, and many have seen this as an indication of improvement in the mortgage and housing sectors. However, officials have said that whilst the slight upturn was good news mortgage lending levels were still nearly 30% lower than they were in July of last year, which was before the onset of the global credit crunch.

Mortgage lending levels for this July came to £24.8 billion, which is far lower than the figure for July of last year, which came to £34.2 billion. One industry official described this as a notable decline, and added that the mortgage market was likely to remain subdued for the foreseeable future.

He said: ‘This continues the weaker picture seen in June and points towards the more subdued levels of lending we are likely to see in the second half of 2008.’

The mortgage lending levels for July were the highest since April of this year, when mortgage lending reached £26.1 billion. The CML and other industry agencies and groups are still calling on the government to take further action to try and boost the mortgage and housing industry.

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