First-time buyers borrowed £53.2bn for home-owner house purchase in 2016, up 15 per cent on 2015 and the highest level since Council of Mortgage Lenders records began in 1974.
The CML says first-time buyer lending totalled 338,900 loans in 2016, up 8 per cent from the previous year.
Homebuyers borrowed £127.7bn in 2016, up 7 per cent on 2015. This came to 698,900 loans, up 3 per cent on the year before.
Homemovers took out 360,300 loans, down 2 per cent on 2015, but the amount borrowed totalled £74.3bn which was up 3 per cent on 2015.
Remortgage activity was up 14 per cent by volume and 20 per cent by value to £66.2bn in 2016 compared to 2015.
Gross buy-to-let also saw year-on-year increases, up 3 per cent by volume and 7 per cent by value, with remortgage business accounting for nearly two thirds of the total.
CML director general Paul Smee says: “2016 could have been a potentially destabilising year of regulatory and political change, but the mortgage market has been resilient and adaptable.
“Home-owner house purchase lending increased, though the buy-to-let sector’s positive lending performance has been driven primarily by remortgaging. We do not expect the market volumes to show a year-on-year increase in 2017 instead remain similar to that achieved in 2016.”
Legal & General Mortgage Club director Jeremy Duncombe says: “After a turbulent year politically, the mortgage market still managed to end the year on a strong note.
“In the second half of 2016 remortgaging dominated the market as both homeowners and landlords took advantage of record low interest rates.
“It’s also reassuring to note the year-on-year increase in first-time buyer activity as more people were able to take their first steps onto the property ladder.
“That said, these figures highlight the supply and demand gap, which continues to support runaway house price inflation. For as long as demand outstrips supply, this trend will continue.”
Hope Capital chief executive Jonathan Sealey says: “Despite everything the housing market last year defied expectations.
“Although we are still below pre-crisis levels, to show any kind of increase in a such an unpredictable year gives hope for 2017.
“For the time being interest rates look set to remain low and there are plenty of great deals to entice borrowers. Supply is the constant problem, and we will have to wait and see how the government’s plans to ‘fix the housing market’ are actually implemented.”