The British Bankers’ Association (BBA) has reported that gross mortgage borrowing of £13.2 billion in February was lower than in January but 33% higher than a year ago and the second highest increase since mid-2008.
The number of mortgage approvals in February was 26% higher than a year ago, with remortgaging up 31% and house purchase up 20%.
Unsecured borrowing by households is growing at around 6% per annum reflecting low interest rates and relatively strong household finances.
Richard Woodhouse, chief economist at the BBA, said: “Mortgage borrowing remained buoyant in February. It appears that borrowers are continuing to try to get ahead of the increases in stamp duty for buy-to-let and second home buyers scheduled to come into effect next month.
“Consumer confidence is also robust. Households are increasingly taking advantage of low interest rates by taking on more unsecured borrowing.”
Adrian Whittaker, sales director at New Street Mortgages, added: “Whilst the annual rise in lending may be in part due to borrowers seeking larger mortgages, it also highlights that more people are now looking to buy property as the market returns to a healthier state. In this new, fast-paced, sellers’ market, buyers will need all the help they can get when it comes to winning the race to buy property.
“One way lenders can assist in this process is to speed up mortgage applications by updating systems and utilising the latest technology to get out mortgage offers quickly. This can make all the difference to buyers, who will now find themselves up against a growing number of competitors as they look to secure their next property.”