Net mortgage borrowing was £11.8bn in March, the strongest since the series began in April 1993, according to Bank of England money and credit report.
Mortgage approvals for house purchase were 82,700 in March, lower than the recent peak of 103,100 in November 2020, but higher than in February 2020 (73,000).
The strength in mortgage borrowing follows a large number of approvals for house purchase. These approvals have fallen from a recent peak of 103,100 in November to 82,700 in March, but they remained relatively strong, according to the report.
John Phillips, national operations director at Just Mortgages and Spicerhaart, said: “This year has been unprecedented in terms of the volume of mortgages, and March was possibly the peak in an impressive climb. Partially driven by a desire to beat the initial stamp duty deadline, we’ve had a continuous stream of clients looking for mortgages in the first quarter of 2021.”
Jonathan Sealey, chief executive at specialist lender Hope Capital, said: “Everybody expected the stamp duty holiday to drive activity especially as the deadline loomed closer, but to reach the highest level of borrowing in almost 30 years is exceptional.
“As borrowing follows approvals, we are likely to see some fall back in a couple of months, as we have seen with approvals which have come down in March from a peak in November - although still higher than a year ago.
“But this has to be seen as yet more positive news for the property market and the wider economy, off the back of the return of 95% LTV mortgage products and various government initiatives announced at the last Budget in March.”
According to the Bank of England, individuals have made “significant” net repayments of consumer credit since March 2020. A further net repayment of £0.5bn in March this year was, however, a little smaller than seen on average each month over the past year (£1.9bn).
It was also a smaller net repayment than in March 2020 (£4.1bn), so the annual growth rate – while remaining weak at -8.6% in March – rose from its series low of -10% in February.