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Last Updated: Thursday, 18 January 2007, 14:09 GMT
Mortgage lending 'at record high'
For Sale signs
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Mortgage lending fell 10% in December, but was still at record levels for the month, figures showed.

Homebuyers borrowed 29.4bn from banks, building societies and specialist firms, the Council of Mortgage Lenders (CML) said in its monthly report.

This compares with 33.1bn in November, and is 8.8% higher than December 2005.

The CML predicted that high prices and demand for homes would continue and that mortgage lending would top the 346bn that was borrowed in 2006.

That figure was 20% up on the figures for 2005.

Cooling off

However the CML added that the latest interest rate hike may deter some would-be homeowners from getting onto the property ladder.

Earlier this week, the CML said that first-time home buyers in the UK were borrowing an average of 113,887 to pay for their first properties - equivalent to 3.29 times their incomes.

The latest Royal Institution of Chartered Surveyors (RICS) report said the market was now starting to cool down, largely as a result of rate rises imposed late in 2006.

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