Underlying net mortgage lending rose by a record amount in August, British Bankers' Association data showed on Wednesday, in another sign the Bank of England's surprise rate hike last month has not deterred house buyers.
Net mortgage lending rose by 6.2 billion pounds, up from an 5.8 billion increase in July and well above the monthly average rise of 5.4 billion over the previous six months.
The BBA said August's mortgage lending number beat the last record set in April 2004 when it increased by 6 billion pounds.
The draw down of house purchase loans in particular has driven net mortgage lending higher of late and August's increase set a new monthly record, BBA Director of Statistics David Dooks said.
The Bank of England's Kate Barker said on Tuesday the strength of the country's housing market had surprised policymakers this year and could boost consumer spending.
The closely watched Nationwide and Halifax surveys showed strong rises in house prices in August, in spite of the Bank's quarter point rate hike to 4.75 percent. Economists expect the Bank to raise rates again this year to 5 percent.
Housing market figures from the Building Societies Association were also strong, showing net mortgage advances at a seasonally adjusted 1,561 million pounds in August compared to 1,103 million last August.
The BSA said approvals amounted to 5,158 million pounds against 3,947 million pounds' total last August.
August was yet another very strong month for mortgage lending, said Neil Johnson, PR and Policy Manager at the BSA. The approvals figure suggests that strong demand will continue, and that the recent interest rate rise has had little impact on buyers.
However, house prices are continuing to rise, and interest rates are forecast to increase again later this year.
On the consumer side, the BBA said underlying credit card lending fell by 399 million pounds in August compared with a fall of 77 million in July and an average monthly drop of 143 million over the previous six months.
Buoyancy in mortgage lending is contrasted by the trend in consumer credit, where credit card lending has shown a further decline the fourth month in a row while lending on personal loans and overdrafts was weak, BBA's Dooks said.