Borrowing costs accelerate

15/11/2007

Advanced borrowing costs helped forward by a decline in gross lending during September period, CML’s mortgage survey reveals.

£30.6 billion was September's total; it was less than August which was £34 billion however greater than one year ago (£29.2 billion in September 2006 period).

During September remortgaging and other lending stayed afloat. Remortgaging was much more greater compared with August figures (£11 billion) and last year in September (£10 billion).

CML's director general Michael Coogan spoke further: "Data indicates that higher interest rates are now beginning to slow the housing market, in line with our recently published forecasts. Looking forward, we expect remortgaging to continue to hold up as borrowers coming off fixed rate deals look to re-finance."

He added: "The Bank of England's decision not to reduce rates earlier this month will have disappointed many borrowers. Looking forward, affordability is likely to continue to constrain buying activity, which we expect to remain subdued. Interest rates have now reached their peak and a move downwards will help ease some of the pressure on household finances."

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