Net mortgage lending rose 19% from £5.2 billion in February to £6.2 billion in March, according to the latest money and credit statistics from the Bank of England.
The Bank said this is above the previous six-month average of £4.9 billion.
The annual growth rate of net mortgage lending fell from 3.4% in February to 3% in March.
Gross loans secured rose to £28.7 billion in March from £24 billion, above the six-month average of £23.9 billion.
Repayments rose to £19.7 billion in March from £18.6 billion in February, slightly below the six-month average of £19.8 billion.
The difference between gross lending minus repayments and net lending figures is due to the different seasonal adjustment methods applied by the Bank in these series.
Net mortgage approvals (that is, approvals net of cancellations) for home purchases, which is an indicator of future lending, rose to 63,500 in March from 62,700 in February, above an average of about 63,200 over the previous six months.
The number of approvals for transferring a mortgage (which only concerns transferring from another mortgage provider) has also increased, from 41,200 in February to 51,300 in March.
The ‘effective’ interest rate – the actual interest paid – on newly taken out mortgages fell from 4.10% in February to 4.03% in March. The interest rate on the outstanding stock of mortgages was 3.93% in March, compared to 3.95% in February.
Mark Harris, managing director of mortgage broker SPF Private Clients, said: “Mortgage applications increased in March, demonstrating an underlying resilience in the housing market. This resilience began to emerge as soon as the Budget was in the rear-view mirror and continued as interest rates began to rise due to the conflict in the Middle East.
“The effective interest rate on new mortgages fell to 4.03% and the interest rate on the outstanding stock of mortgages also fell to 3.93%. Concerns remain about affordability, but in recent days we have seen lenders reduce their mortgage rates, which will be welcomed by borrowers.
“The number of refinancings has increased significantly, indicating that borrowers taking advantage of low interest rates are looking for the best possible deal rather than opting for the convenience of staying with their existing lender.”