Mortgage loans at lowest level since 2000

Mortgage lending slumped to its lowest September level for a decade as activity in the housing market remained muted, according to the Council of Mortgage Lenders yesterday.

A total of £11.98bn was advanced during the month, 1 per cent less than in August and the lowest figure for September since 2000. It was the second consecutive month during which lending levels fell, as the housing market failed to benefit from its traditional summer bounce.

The CML warned that lending volumes were likely to remain subdued for the rest of 2010.

Michael Coogan, the director general of the CML, said: "Lending volumes do not seem likely to increase substantially towards the end of the year. Funding pressures on lenders remain, and the practical implications of government and public spending cuts are beginning to emerge, with a resulting impact on consumer confidence."

Yesterday's figures came after lending during August was also the lowest for the month for 10 years.