The Council of Mortgage Lenders (CML) has estimated that gross mortgage lending totalled £19.9 billion in December 2015.
This is 3% lower than November (£20.5 billion), but 23% higher than December 2014 (£16.2 billion).
It brings the estimated total for 2015 to £220.3 billion, an 8% increase on 2014’s £203.3 billion and the highest annual gross lending figure since 2008.
Gross mortgage lending for the fourth quarter of 2015 was therefore an estimated £62.3 billion. This is a 1% increase on the third quarter and a 23% increase on the fourth quarter of 2014.
CML economist Mohammad Jamei said: “Lending ended the year stronger than it started, with our estimate of nearly £20 billion lent in December. This brings total lending to just over £220 billion for 2015 as a whole, and slightly higher than we had anticipated. The low inflation environment, along with real wage growth, an improving labour market and competitive mortgage deals have all helped to underpin demand.
“Having said this, the upside potential looks limited over the near-term, as the supply of existing and new properties on the market remains weak, and affordability pressures weigh on activity. There is an added element of uncertainty as we wait to see the impact of tax changes on the buy-to-let sector.”
“We saw a strong end to the year for lending, and 2015 was a positive year for the mortgage market, as low inflation, rising wages and an improving labour market provided the public with the opportunity to buy and remortgage,” said Steve Griffiths, head of sales and distribution at Kensington.
“However, it is important to look beyond headline lending figures to identify the true health of the market. A healthy mortgage industry is one that is able to cater for a broad range of customer circumstances, reflecting the diversity of employment and demographic changes of our population.
“It is vital that specialist lending grows in line with these changes, so that we are able provide opportunity for credit worthy individuals whose circumstances do not tick the boxes of a standard mortgage application.”