March mortgage lending up 64 per cent - BBA

The total for the third month of the year was also the highest amount borrowed in a single month since April 2008, following a reported sharp increase in purchase of buy-to-let and second homes ahead of the increase in stamp duty on 1 April.

The number of mortgage approvals in March was 20 per cent higher than a year ago, with remortgaging up 25 per cent and house purchase up 14 per cent, the BBA said.

Unsecured borrowing by households is also growing at around 6 per cent per annum, reflecting low interest rates and relatively strong household finances.

Dr Rebecca Harding, chief economic advisor at the BBA, said: “A surge in buy-to-let and second home buying ahead of the new stamp duty surcharge in April led to a sharp rise in March’s gross mortgage borrowing as people brought transactions forward.

“For households more widely, consumer credit continues to grow above real earnings growth, as improving consumer confidence and low interest rates combine to stimulate borrowing demand for personal loans, cards and overdrafts.

“Business borrowing is moderating within distribution, manufacturing, food and accommodation sectors, as large corporates use capital markets for their funding and both large and small businesses continue to build up deposits.”