Lending rose by £0.2bn compared to the previous months’ total of £7.3bn. Net lending, the difference between gross lending and capital repayment, has grown by 0.4% in the past 12 months.
The trade body found that the number of mortgages approved for house purchase during the month had continued to rise, but that they were still below 2011 figures. The current level of 63,000 is around a quarter of the 230,000 approvals seen in 2003’s peak month.
The average price for a house purchase was down, falling to £154,100. The numbers of approvals for remortgaging and other types of lending continued to fall during the month.
BBA statistics director, David Dooks said: “October saw the banks lend £7.5bn of new mortgages and approve the future draw-down of a further £8.2bn, whilst households also took £1bn of new personal loans and used the extended credit on cards to fund spending of £7.1bn.
“However, repayment levels are high enough to offset gross lending and generate subdued net lending data, not only in the household sector, but also in the business sector where large companies are using capital market funding.”
Dan McLeod, director of estate agents, Atkinson McLeod, commented: “The property market as a whole remains a shadow of its former self.
“The mortgage market is black and white. There are the people with big deposits who can get fantastically competitive loans and transact quickly, and there are the people with small deposits who face a Herculean struggle to complete a purchase.
“Until people with smaller deposits can purchase with more certainty, the property market will remain on a hiding to nothing.”
