Gross mortgage lending hits £9bn in Dec

The amount lent was 12% higher than in December 2010.

Householders however continued to take a cautious approach to other forms of borrowing. Repayments on unsecured lending matched the amount of new borrowing on loans, overdrafts and credit cards.

David Dooks, statistics director at the BBA, said: “The household` sector generally is focusing on debt repayment amid inflated household expenses and a continuing air of uncertainty, so we see a reluctance to let net borrowing rise, with people referring to use their bank account cash for expenditure.”

David Brown, commercial director of LSL Property Services, said: “The mortgage market finished the year with a flourish in December but it’s difficult to see how far gross lending can increase this year, given the state of the wider economy.

“There has been some welcome positive news, with lenders such as HSBC stating their intent to up their commitment to the mortgage market in the coming 12 months.

“But since the economy is shrinking, and banks and building societies are seeing their funding squeezed by the financial turmoil on the continent, while