Lending in December reached £19.5 billion ($31 billion), showing no sign of anyseasonalslowdown. Remortgaging remained strong in December, accounting for 39% ofthe total. Lending for house purchase totalled £10.6 billion ($17 billion) for the thirdconsecutive month, accounting for 54% of the total.
On the basis of thesefigures, the Council of Mortgage Lenders (CML) expects to see stronglending continuing well into the Spring, but continues to predict aslowdown in growth later in the year.
Average affordability remainspositive. First-time buyers are continuing to put down at least a 20%deposit on average, while movers are typically putting down deposits of atleast a third of the value of their property.
First-time buyers borrowedan average of 2.58 times income in December, while the equivalent figurefor movers was 2.36.
Fixed rates swung back into popularity in December,accounting for 38% of all lending - the highest proportion since lastJanuary. This may be because people are beginning to factor in anexpectation that the next move in interest rates will be up.
Commentingon the figures, CML Director General Michael Coogan said: "As expected,2002 proved to be the strongest year ever for mortgage lending. Theconditions are in place for a soft landing for the housing market in 2003,but the market is not risk-free. We would urge borrowers to try to avoidborrowing up to the maximum limits, and to put down a reasonable deposit,if possible. This will reduce the risk of borrowers over-stretchingthemselves in a market where the future is uncertain."
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