Mortgage lending in new decline

Mortgage lending in the UK took a further dip in May, new figures have indicated.

The British Bankers' Association (BBA) revealed that the rise in lending was only £4 billion in May, compared with £5.2 billion in April and the average over the last six months of £5 billion.

The BBA said the recent fall in housebuying meant such a decline was likely to continue in the next few months.

Assessing the situation, BBA director of statistics David Dooks said: "Only remortgaging business is holding up, where people need or want to take advantage of deals with other lenders."

Responding to the news, director of propertyfinder.com Nicholas Leeming said the core of the problem was simply that buyers "can't obtain finance to buy a home at a reasonable rate" and said that unless it could improve liquidity, any more rate cuts by the Bank of England would be a "sideshow".

Those unable to get a mortgage in the current climate to get on the housing ladder may consider the self build option as an alternative.