By Jason Douglas and Jon Sindreu
LONDON--Lending to U.K. homebuyers increased in June by the
largest amount in seven years and new mortgage approvals rose,
signs that activity in the housing market is picking up.
Mortgage lending rose by 2.6 billion pounds ($4.1 billion) in
June, net of repayments, compared with a rise of GBP2.4 billion a
month earlier, the Bank of England said Wednesday. That was the
largest monthly increase in net mortgage lending since July
2008.
Banks and building societies also approved 66,582 new home loans
in June, compared with an average of 62,971 over the last six
months.
A pickup in the housing market should help drive economic growth
this year, although it may reignite concerns that Britons are at
risk of taking on too much debt, particularly as house-price growth
continues to outpace gains in earnings.
Unsecured consumer borrowing also rose in June, net of
repayments, by GBP1.2 billion.
By contrast, lending to businesses continued to shrink. Loans to
nonfinancial firms in Britain fell by GBP5.5 billion in June, the
BOE said, the biggest monthly fall since comparable records began
in 2011. Data show firms are flush with cash and are increasingly
tapping capital markets to finance investment.
Write to Jason Douglas at jason.douglas@wsj.com and Jon Sindreu
at jon.sindreu@wsj.com