Banks’  net mortgage lending has risen to £7.5 billion in October, a report from the British Bankers’ Association (BBA) has shown.


Net lending in October has risen by £0.2 billion, compared with last month’s total of £7.3 billion.


Net lending, which represents the different between gross lending and capital repayment, has also grown by 0.4 per cent in the last 12 months.


The number of mortgages approved for house purchases has continued to show an upturn in October but are yet to return to levels seen last year, when almost 35,000 loans were approved.


Approvals for remortgaging and other secured lending, however, have remained at lower levels than previous years, in line with the reported lower level of activity within the housing market.


Although on average 63,000 mortgage approvals are issued a month, figures remain some way off the 230,000 approved monthly at the lending market’s peak in 2003.


The BBA also reported that the average price of a house had fallen further to £154,100.


The main high street banking groups (MBBG) surveyed account for two-thirds of all UK mortgage lending outstanding, providing around half of all consumer credit. Their numbers include the six largest UK retail lending institutions: Barclays, HSBC Bank, Lloyds Banking Group, RBS Group, Santander UK and Virgin Money.


The BBA’s statistics director, David Dooks, said: “October saw the banks lend £7.5 billion of new mortgages and approve the future draw-down of a further £8.2 billion. Households also took £1 billion of new personal loans.”


He added: “However, repayment levels are high enough to offset gross lending and generated subdued net lending data, not only in the household sector but also in the business sector, where large companies are using capital market funding.”