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Last Updated: Thursday, 22 April, 2004, 11:55 GMT 12:55 UK
Consumer debt continues to soar
Person looking in estate agent's window
More buyers want a foot on the property ladder, the CML says
Mortgage lending in Britain surged ahead in March as consumers' appetite for debt showed little sign of easing.

Total mortgage advances jumped by 19.5% in March to 24.5bn ($43bn) - its highest level in four months - the Council of Mortgage Lenders (CML) said.

The British Bankers' Association (BBA) also reported bumper figures for the month, with lending through mortgages, credit cards and loans rising.

The figures are likely to raise expectations of an interest rate rise.

More mortgages

Many analysts are anticipating a rate rise when the Bank of England's Monetary Policy Committee (MPC) meets next month.

Minutes published on Wednesday from the MPC's April meeting revealed the nine member committee voted 8-1 to hold interest rates at 4%.

The CML said the jump in mortgage advances was boosted by a 24% rise in lending for house purchases, which increased by 11.3bn.

However, the value of loans for people remortgaging their homes increased by a relatively moderate 12% to 10bn, the CML said.

'Buy now'

CML director general Michael Coogan said: "It now seems clear that the housing market has experienced an upswing in the first quarter of this year."

He said: "Buyers who could not decide whether to enter the market last year may now be deciding to buy because they think they may be priced out of the market if they postpone their decision any further."

He added: "We now expect the Bank of England to be watching the housing market very closely."

Separately, the BBA said borrowing on credit cards rose by 500m in March.

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