The mortgage market has had its strongest start to a year since 2008, with lending up by 2% from January 2016.
The Council of Mortgage Lenders said that gross mortgage lending was £18.9 billion last month.
This figure is 2% higher than the £18.5 billion lent in the same month last year and the highest total since the £25.2 billion lent in January 2008.
Despite the rise, the figure was 6% down on December’s figure of £20 billion.
CML economist, Mohammad Jamei, said: “Overall mortgage lending continues to hold up pretty well, but we seem to have a twin-track market. Weakness in buy-to-let and home movers has been offset by an increase in first-time buyers and remortgage lending.
“A continuing acute shortage of homes being offered for sale is one aspect of a broken housing market that looks unlikely to resolve in the near term.”
Ishaan Malhi, CEO and founder of online mortgage broker Trussle, said: “At the end of last year, we witnessed the highest level of mortgage activity since 2008, and despite a month-on month dip, it’s still been the strongest January in nine years.
“This trend is clearly not going anywhere while interest rates remain so low. While first time buyers still face serious challenges in securing that first mortgage, more and more existing borrowers are waking up the financial opportunity being offered by this sustained period of rock-bottom mortgage rates.
“It’s my view that remortgaging levels will keep rising for two reasons. Firstly, there are currently three million people in the UK paying over the odds on a standard variable rate mortgage, and awareness among this group is gradually growing. Secondly, the mortgage switching process is becoming faster and easier for people to access online and at their own convenience, and this will naturally lead to greater engagement.”
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