CML: Mortgage lending sees surprise rise in December

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by Kay Murchie

The Council of Mortgage Lenders (CML) has today announced a rise in December mortgage lending - traditionally a quiet month for house purchase.

However, the CML attributed the rise to homeowners rushing to beat the stamp duty rise on 1 January.

According to the CML, UK mortgage lending grew by 14% in December compared with the previous month to £13.7 billion.

However, the figure represented a small rise of 3% when compared with December 2008.

Commenting on the figures, CML economist Paul Samter, said: “Evidence suggests that the rise was driven by a surge in house purchase completions.

“The most likely explanation is that buyers of cheaper property wanted to complete their transactions before the end of the year to beat the end of the stamp duty holiday.”

The stamp duty holiday ended on 31 December 2009, consequently all properties priced at £125,000 and above are once again subject to the levy.

Mr Samter concluded that a seasonal decline is expected in the early part of the year but an improvement should be seen in the latter part of 2010.