RTTNews - Gross mortgage lending in the U.K. totaled an estimated GBP 10.3 billion in May, down 2% month-on-month from the GBP 10.5 billion in April, the Council of Mortgage Lenders said Thursday. Lending fell for the second straight month in May after showing an increase in March. In April, it had dropped 9%. Compared to the previous year, gross lending was down 58% in May.

The CML said as gross mortgage lending includes both lending for house purchase and remortgage, a slight improvement in house purchase activity will not be fully reflected in overall gross lending when remortgaging is declining.

CML economist Paul Samter said, While recent signs from the housing market have been more encouraging, we do not anticipate a significant recovery in activity in the coming months.

Samter said the weak labor market and lenders' limited access to funding will constrain activity for some time yet.

Underneath the headline gross lending figure, it's likely that a moderate improvement in house purchase lending in May has been offset by very low remortgaging volumes as borrowers stay with existing deals, Samter said.

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