Gross mortgage lending held steady in February and was an estimated £10.7 billion, according to the Council of Mortgage Lenders.

This is almost identical to January’s gross lending total of £10.65 billion and 14% higher than February last year (£9.4 billion).

Despite a weakness in property sales, there has been strong year-on-year increases since the closing months of 2011. Allowing for the seasonal factors that depress activity over the winter months, the underlying picture for house purchase activity continues to show some buoyancy.

With that, the CML believes that lending for house purchase remained brisk through February. Our forward estimate is that gross mortgage lending totalled £10.7 billion in February. This would be the seventh month in a row of higher year-on-year lending.

Although numerous commentators, including the CML, have referred to first-time buyers looking to beat the end of the stamp duty concession on 24 March, it is worth noting that it is not just first-time buyers driving firmer property sales activity. Our Regulated Mortgage Survey figures up to and including January show only minor changes in first-time buyers as a share of house purchase lending.

The pick-up in activity appears to mark a generalised improvement, with the latest RICS survey also reporting that its members were no longer predicting further house price falls. This may reflect household sentiment stabilising in anticipation of a recovery in real incomes, but wider economic uncertainties make it difficult to judge how well the upturn will persist.

In addition, the CML said: “Recent weeks have also been busy on the housing policy front, with the launch of a reinvigorated Right to Buy (RTB) and the NewBuy scheme, announced in last November’s housing strategy. The latter is a mortgage indemnity scheme that will assist potential buyers of new build properties that have no more than a 10% deposit. A Scottish variant of NewBuy has also been announced and should become operational shortly.

There has been quite a lot of media criticism of the NewBuy scheme, much of which reflects a poor understanding of its design. The scheme aims to help a particular group of households – those with good credit characteristics but who are for whatever reason deposit-constrained. There is no question of participating lenders diluting their normal credit standards, and this is one of the key reasons why no specific targets have been set for take-up under NewBuy.

While first-time buyers, and especially those without access to the bank of mum and dad, may be attracted to it, NewBuy is not an exclusively first-time buyer scheme. The CML and some of our member firms have highlighted the deposit constraints facing ”second steppers” (the first-time buyers of a few years ago). It is by no means inconceivable that these existing home-owners with a proven track record of mortgage repayments find favour with NewBuy lenders.

In short, both the scale of take-up under NewBuy, and the borrower mix, are unknown at this stage, and this makes it difficult to accurately gauge what the initiative will deliver. It is not intended, nor is it likely, to transform the housing market. Nevertheless, the CML welcomes NewBuy as an important addition to lenders’ toolkit in addressing the various needs of would be borrowers.

It will likely take a couple of years to accurately gauge how beneficial its impact has been. More immediately, although it will take time for the RTB and NewBuy schemes to build, they have the potential to offset the dip in first-time buyer activity that the end of the stamp duty concession on 24 March seems likely to produce.”

In it’s market commentary, CML chief economist Bob Pannell comments: “Although a seasonal decline is expected over the winter months, our forward estimates suggest that February was the seventh month in a row of higher year-on-year lending. This indicates that lending for house purchase remains brisk in advance of the ending of the Stamp Duty concession.

“The launch of the NewBuy scheme is an important addition to lenders’ toolkit in addressing the various needs of would-be borrowers. The scheme has the potential to offset the dip in first-time buyer activity that the end of the stamp duty concession on 24 March may produce.”