UK Finance has published its Household Finance update for December 2018 which have revealed that over £11 billion spent on credit cards which showed an 8.8 per cent increase when compared with the same month the previous year. The outstanding level of credit card borrowing grew by 4.7 per cent in the twelve months to December. Personal borrowing through loans and overdrafts grew by 3.4 per cent in the year to December.

Gross mortgage lending across the residential market in December 2018 was £21.1bn, some 4.7 per cent higher than the same month the previous year. Gross mortgage lending across the residential market during 2018 was £267.5bn, some 3.8 per cent higher than in 2017.

The number of mortgages approved by the main high street banks in December 2018 was 2.4 per cent lower than the same month the previous year; approvals for home purchase were 5.3 per cent higher, remortgage approvals were 5.8 per cent lower and approvals for other secured borrowing were 18.9 per cent lower.

Commenting on the data, Eric Leenders, Managing Director, Personal Finance at UK Finance said “Mortgage lending grew in December compared to the previous year, with borrowers defying seasonal trends and purchasing a property throughout the festive period.”

“Growth in credit card spending continues to be largely offset by increased cardholder repayments, with almost half of cards not bearing any interest at all. This reflects the growing trend of consumers using credit cards as a preferred payment method rather than as a means of borrowing, in order to take advantage of additional protections and value-added benefits.”

Richard Pike, Phoebus Software sales and marketing director, sais “It is hard to talk about anything at the moment without mentioning the ‘Brexit’ word, it is all consuming and there is little doubt that it continues to affect the housing market.  The fact that house purchase approvals were up in December suggests that people are planning ahead and making their move before the March deadline.  Interestingly the number of remortgage approvals took a dip compared to the same month in 2017, which bucks the trend throughout the rest of the year.

“Nonetheless, I would expect it to be the remortgage sector that will be keeping the mortgage market going in the coming months, as we wait to see how our exit from the EU pans out.”