Key data highlights:

  • Estimated gross mortgage lending for the total market in May is £22.2bn, 8.8 per cent higher than a year earlier.
  • The number of mortgage approvals by the main high street banks in May has also risen, increasing by 3 per cent compared to the same month a year earlier.  As in April, increased approval numbers were driven by remortgaging, some 18 per cent more than a year earlier.  In contrast, approvals for house purchase were 3.8 per cent lower than the same period a year earlier.
  • Credit card spending was 2.3 per cent higher than a year earlier, with outstanding levels of card borrowing having grown by 5.7 per cent over the year.  The total of 193 million credit card purchases in May was well above the previous 12 month average of 181 million, reflecting increased retail sales.  Outstanding overdraft borrowing was 3.9 per cent lower compared to the same time last year.
  • Personal deposits grew by 1.6 per cent in the last 12 months, although this was a lower annual rate than seen historically.  Deposits held in instant access accounts were 4.4 per cent higher than a year earlier.

Commenting on the data, Eric Leenders, Managing Director, Personal Finance at UK Finance said:

“May’s increase in mortgage approvals was driven by strong growth in remortgaging, as a large number of fixed-term mortgages came to an end and homeowners took advantage of a competitive market to shop around for attractive deals. Increased efforts by lenders to contact their customers before their current mortgage deal expires have also contributed to this rise.
“There was modest growth in card spending, reflecting a boost to retail sales amid the good weather over recent bank holidays and the Royal Wedding celebrations.
“However, the overall economic picture remains mixed, as household incomes continue to be squeezed. This may explain the growth of deposits held in instant access accounts, with consumers increasingly choosing to keep their money close to hand.”

 

Notes to Editors

  1. 1 For more information please call the UK Finance Press Office on 020 7416 6750 or e-mail press@ukfinance.org.uk.
  2. UK Finance is the trade association formed on 1 July 2017 to represent the finance and banking industry operating in the UK. It represents around 300 firms in the UK providing credit, banking, markets and payment-related services. The organisation brings together most of the activities previously carried out by the Asset Based Finance Association, the British Bankers’ Association, the Council of Mortgage Lenders, Financial Fraud Action UK, Payments UK and the UK Cards Association.
  3. Data in this update reflect lending and deposit activity conducted by UK households with the main high street banks. This coverage reflects more than two-thirds of UK household finance provided by all banks and building societies.
Attachments
Household Finance Update – May 2018