Falling confidence in the property market and tighter lending restrictions worked against the December interest rate cut and led to the lowest mortgage borrowing in December for 2 and a half years.
At £22.6bn, this was a 21% reduction against the previous December and 25% less then November, revealed the Council of Mortgage Lenders.
Overall, in 2007 almost £1bn was borrowed in mortgages per day - a £362bn. This is up 5% on 2006 in which £345bn was borrowed.
The Council of Mortgage Lenders' figures showed mortgage lending by building societies broadly flat during 2007 at £52.1bn, compare to £52.8bn lent in 2006. But net lending, which allows for redemptions and repayments, fell by 21% to £12.6bn.
Analysts predict "a very good chance of an interest rate cut in February, and at least one more during 2008".
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