Lending for house purchases increases, figures show

New figures released by the Financial Services Authority (FSA) into the state of the mortgage market has found that more than half of new advances within the sector were made for house purchases in the third quarter of 2009.

Meanwhile, remortgages accounted for just 34 per cent of lending, their lowest level since the FSA began publishing its quarterly reports in 2007.

It also noted that the total value of outstanding loans is one per cent higher than a year earlier, standing at £1,203 billion.

Additionally, the FSA revealed that the number of households that have fallen into arrears has dropped by two per cent compared with the second quarter of this year. However, this is still 16 per cent higher than the same period in 2008.

Michael Coogan, director general of the Council of Mortgage Lenders, commented: "The FSA data reflects what our numbers have already portrayed. Arrears and possessions are lower than expected earlier in the year."