CML: Mortgage lending at 5yr high

The increase represents a rise of 2% from £14.7bn lent in May and is some 26% higher than the total of £11.9bn lent in June 2012.

Gross lending for the second quarter of 2013 stands at an estimated £42bn. This represents a 24% increase on the previous quarter and is the highest quarterly estimate since Q4 2008.

Bob Pannell, chief economist at the CML, said: "Improvements in the cost and availability of mortgage credit are underpinning a meaningful recovery in the housing market.

“In recent months we have seen the strongest performance for mortgage lending since 2008.

"However although the pace of first-time buyer activity is approaching a quarter of a million per annum, it is worth bearing in mind that this is still barely half of activity rates a decade earlier, and so far below what might be considered normal levels."

Mark Harris, chief executive of mortgage broker SPF Private Clients, said the welcomed the news but warned that there is still a long way to go before the market recovers fully.

He added: “The outlook for the housing market continues to improve as increased mortgage availability, better rates and more choice at higher loan-to-values is reflected in the official numbers.

“It is a trend brokers and estate agents have seen since the start of this year: increased confidence in the market and ability to get the funding required is persuading more people to take the plunge and either get on the housing ladder for the first time or move up it.

“However, while the lending numbers are the strongest they have been since 2008, this will be a long, slow recovery.

“Much ground has been lost and lending levels are running at a fraction of what they were at the height of the housing boom.

“Government schemes such as Funding for Lending and Help to Buy are already seeing a positive impact though, and we expect this to continue when the mortgage guarantee element of Help to Buy is introduced in January."