Mortgage appetite starting to wane, says CML

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Image caption Mortgage lending has picked up since the financial crisis

Borrowers' appetite for home loans is "starting to wane" despite an annual rise in mortgage lending, say lenders.

Gross mortgage lending hit £18.6bn in August, down 5% on July but 13% higher than a year earlier, the Council of Mortgage Lenders (CML) said.

It added that the seasonally-adjusted figure had been relatively flat since the start of the year, suggesting activity was at a plateau.

It is predicting a "gentle slowing" in the UK housing market from now.

This was partly the result of a deceleration in London, which has witnessed frantic activity and double-digit price rises at times in the last year.

The latest figures from the Office for National Statistics (ONS) showed that house prices in London rose by 19.1% in the year to the end of July.

Overall, UK property prices were up 11.7% over the same period.

Other surveys have suggested a slight slowdown over August.

Richard Sexton, director of e.surv chartered surveyors, said: "The mortgage market may have paused for breath in August, but the recovery is still in full swing. However, it is patchy at best. Some areas of the country are operating on fast-forward, but other areas are still at a standstill."

A number of lenders have reduced the interest rate on some of their fixed rate mortgage deals in recent weeks, with little indication of an imminent rise in the Bank rate set by the Bank of England which is still at a historic low of 0.5%.

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