Gross lending declines in September to 2001 level

Gross lending for the third quarter is estimated at £62 billion, down 16% from the second quarter of 2008 and 37% from the third quarter of last year.

A seasonal fall is typically experienced between August and September. However, £17.7 billion is the lowest gross lending figure since January 2005 and the lowest September figure since 2001.

CML director general, Michael Coogan, said: 'The mortgage market is open for business. But weakening consumer demand and ongoing funding constraints will dampen monthly lending figures for the rest of this year and into the first quarter of 2009.

'We estimate gross lending in 2008 will be around £255 billion (£363 billion in 2007) and net lending of around £40 billion (£108 billion in 2007)."

Jonathan Turpin, Chief Executive of, commenting on the figures said: "Gross lending may have fallen again in September, but there is light at the end of the tunnel for homebuyers who are yet to see the impact of the Government's multi-billion pound rescue package. A recovery will not happen overnight - it takes time for the cash injection to work its way into the banking system, bringing a return of confidence which will encourage the banks to start lending to each other again.

"Homebuyers can be confident that gross mortgage lending will begin to rise again over the coming months. There is huge pent up demand in the system, caused by those people who want to buy, but who have found it difficult or impossible to raise finance. Once the wholesale money markets start moving again, we can expect to see new mortgage deals coming onto the market and rates beginning to fall."

Lets hope he is right.