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Record numbers of cheap mortgages

Date: Mon, 30 Jan 2006

Home loan lending shows signs of increasing as more people obtain cheap mortgage deals.

The British Bankers' Association (BBA) has reported that December's gross mortgage lending rose by 20 per cent to £16.9 billion compared to the same period in 2004. Total mortgage lending during 2005 reached £185.3 billion, compared to£188.4 billion for the previous year.

The growing demand for mortgages reflects the continued competition in the industry and the ability of many lenders to offer customers a range of cheap mortgages to help fund property purchases especially following the Bank of England's interest rate cut.

"The healthy mortgage lending and approvals data show that housing market activity extended its recent firmer performance in December," said Global Insight's chief European economist, Howard Archer.

He added: "It seems that August's interest rate cut, expectations of a further trimming in interest rates, relatively high employment and improving confidence in the housing market are supporting activity."


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