Housing market activity has reached a plateau as consumers face a period of “belt tightening”, according to a trade body.
Figures from UK Finance show mortgage lending reached about £22.1 billion in June, taking the total for the second quarter of 2017 to around £60.3 billion. This was a 3% increase on the first quarter.
UK Finance is a new trade association launched earlier this month to represent the finance and banking industry. The mortgage lending figures were previously released by the Council of Mortgage Lenders (CML).
UK Finance senior economist Mohammad Jamei said: ” A period of belt-tightening now seems to be under way as inflation begins to erode consumer spending power, and consumer confidence weakens.
“Given that the economy and housing market are closely linked, this has contributed to the activity plateau since the start of the year.
“Looking ahead, housing market activity is likely to reflect economic conditions – a deterioration would likely dampen first-time buyer numbers and homeowners remortgaging – the factors that have supported lending recently.”