The recent trend of increasing activity in the housing and homeowner loan markets over the past few months has continued once again throughout the month of July this year, according to the latest figures from the Council of Mortgage Lenders (CML).

The CML figures show that gross lending on mortgages and homeowner loans increased by 26 per cent in July alone, with a total of £16 billion worth of new loans being offered over the course of the month, compared with just £12.7 billion in the previous month.

Following historically low levels of new lending at the end of last year, there has been a steady increase in the level of new loan activity over the course of the year so far and although the figures show positive movement, total lending is still significantly lower than it was at the same time last year, when there was £24.9 billion worth of new homeowner loans offered. In fact, despite the recent increase in activity, the number of new loans is currently at its lowest level since 2001 and £11 billion below the seven year average figure for July, according to the CML.

The CML said that the increase was largely due to new homeowner loan for purchase, rather than remortgage and that it did not expect further significant improvements due to the current economic conditions. Paul Samter of the CML said “The bounce back in activity from the extreme weakness around the turn of the year, coinciding with a seasonal bounce, is limited in how far it can go against the current back drop. We expect improved sentiment to support the market, but a further significant pick up is unlikely with so many obstacles in place.”