Net mortgage borrowing has fallen from £4bn in December 2021 to £5.9bn in January this year, according to new figures from the Bank of England (BoE).
This figure, according to the BoE, is higher than the pre-pandemic average of £4.3 billion in the 12 months to February 2020.
Gross lending also increased from £22bn to £23.8bn over the same period.
Meanwhile, house purchase approvals fell from 71,200 to 74,000 and from £16.1bn in value to £16.8bn.
And mortgage approvals also rose, from 45,100 to 46,200 – and worth £9.1bn to £9.4bn.
The BoE adds that the interest rate paid on new mortgages remained stable, at 1.58%, and the rate on outstanding mortgages only increased by 1 basis point, to 2.01. %.
Simon Gammon, Managing Partner of Knight Frank Finance, said: “We expect [this] data to show another recovery in the coming months. Many potential buyers have chosen to wait during the pandemic, whether due to low inventory or uncertain prospects.
“We are now seeing a large number of people looking to move before rates rise further. The limiting factor to buying activity over the coming weeks will be the shortage of properties to buy.
He adds: “The BoE remortgage data does not take into account deals when borrowers stay with their current lender, but we are seeing a significant number of borrowers looking to remortgage ahead of another potential rate hike in March. .
“There is no doubt that mortgage rates will continue to rise over the course of the year, what is unclear is how fast. The outlook is much more uncertain amid the escalating conflict in Ukraine.
And Managing Director of SPF Private Clients, Mark Harris, comments: “With property prices continuing to rise, as well as energy prices and the cost of living more generally, there are concerns that this not remain the case. But with the BoE announcing plans to scrap its mortgage affordability test, lenders will in theory be able to lend more, especially to first-time buyers.
“Fears that banks are acting irresponsibly and lending far more than borrowers can afford to repay are probably far from reality.
“Banks will be more keen to attract high-income households with relatively low expenses, who can best afford to cover increases in their mortgage payments.”