Bricks and mortar 'in good health' as loans and prices rise

Mortgage borrowing rose to one of the highest monthly levels on record last month when it reached £28.1bn.

This is according to new figures from the Council of Mortgage Lenders (CML), which show that total lending increased by 4.3 per cent from £26.9bn in August.

This growth, said the CML, has been bolstered by high levels of remortgaging, as people take advantage of lower interest rates and switch to cheaper deals.

"The housing market is in relatively good health," said CML spokesman Michael Coogan. "Buyers appear to have become more confident that current prices are sustainable."

New figures from property website Rightmove showed that house prices rose by 0.5 per cent in September - the first time, it said, that values have not fallen for three months.

And last week, the Royal Institution of Chartered Surveyors, whose own calculations for the market have previously been more downbeat, also predicted a rise in property prices by the end of the year.

"The upturn in demand and improved outlook on interest rates has led surveyors to predict house price rises for the first time since early 2004," said spokesman Ian Perry, "although these are expected to be small."

Duncan Pownall from broker Bradford & Bingley, said the figures were promising.

"The activity among home movers demonstrates increased confidence in the housing market as price growth stabilises. These are encouraging signs that the bottom will not fall out of the housing market, and that lending figures will continue to gain strength."

Credit cards

The Visa credit card network has come under fire for charging too much every time consumers make a transaction.

The Office of Fair Trading said an agreement between Visa and the banks that issue cards breaches competition law.

The dispute concerns the "interchange fee", which covers the cost of handling card transactions and is levied on retailers each time shoppers make a purchase.

The OFT said the agreement led to an "unduly high fee" being paid to the banks. This cost, it added, was ultimately passed on to consumers through higher prices.

The competition watchdog has issued a statement of objection about the fees, and the parties involved now have the chance to respond before a final decision is made.

Colin Grannell, managing director of Visa, said: "We do not agree that the rates are unduly high."

Last month, the OFT ruled that a collective agreement between MasterCard and its members was anti-competitive.

It said that between March 2000 and November 2004, they were setting the fee too high so they could recover costs elsewhere - such as those incurred by interest-free periods.

Child care

Fathers with new babies could take three months' paid paternity leave - and another three months unpaid - under new plans published by the Government last week.

At present, men are allowed just two weeks' paid leave - at a statutory minimum of £106 a week - but under the proposals published last Wednesday in the Work and Families Bill, fathers would be paid for a full three months instead.

Trade and Industry Secretary Alan Johnson said the proposals in the Bill would help parents balance the demands of their jobs with those of caring for their children.

Under other plans in the Bill, new mothers could see their paid statutory maternity leave increased from six to nine months (and ultimately to a year by the end of this parliament).

The Bill would also allow fathers to take the whole second six months' leave instead of mothers - if, say, their spouse was in a better-paid job.

Mr Johnson said men want to be more involved with their new-born babies, and if the mother chooses to go back to work after the first six months, the father could then pick up extra paternity leave.

He added that the DTI had consulted widely with businesses.

Due to come in during April 2007, the Bill would also increase flexible working arrangements for parents and carers.

Spending

Britons are planning to tighten their belts this Christmas by cutting their credit card spending. Findings from Morgan Stanley show consumers will spend an average of £940 over the next three months - 10 per cent less on their plastic than during the same period last year.

The biggest cut will come in socialising, with people expecting to spend a third less on going out.

Shoppers also plan to reduce their credit card spending on clothes, shoes and health and beauty.

The number one credit card spend in the final three months of the year will be on groceries, with consumers spending an average of £234. But even this is 10 per cent lower than during the previous year.

"Our findings suggest Britons will be spending sensibly," says Morgan Stanley spokesman Patrick Muir. "This prudence may mean a leaner Christmas, but it is just as likely to reflect the growing savviness of shoppers who now demand more for their money."