Home movers borrowed £9.3bn, up 75% on February and 82% compared to a year ago.
Home-owners borrowed £13.8bn for house purchase in March, up 59% month-on-month and 60% year-on-year, figures from the Council of Mortgage Lenders show.
They took out 69,800 loans, up 45% on February and 38% on March 2015.
First-time buyers borrowed £4.5bn, up 32% on February and 29% on March last year. This totalled 28,100 loans, up 28% month-on-month and 17% year-on-year.
Home movers borrowed £9.3bn, up 75% on February and 82% compared to a year ago. This totalled 41,700 loans, up 60% month-on-month and 58% on March 2015.
Remortgage activity totalled £4.7bn, down 2% on February but up 7% compared to a year ago. This came to 28,000 loans, down 2% month-on-month but up 0.4% compared to a year ago.
Landlords meanwhile borrowed £7.1bn, up 87% month-on-month and 163% year-on-year. This came to 45,000 loans in total, up 88% compared to February and up 142% compared to March 2015.
Paul Smee, director general of the CML, said: “Activity was distorted in March due to a rush to beat the introduction of changes to stamp duty on second properties in April, alongside the seasonal uptick in activity before Easter.
“While the increases are substantial, these supercharged levels of activity are likely to be temporary and will fall back over the Summer months.”
Jeremy Duncombe, director of Legal & General Mortgage Club, said: “March clearly saw a rise in mortgage lending on buy-to-let properties, as landlords rushed to complete their transactions ahead of the rise in stamp duty.
“Whilst it is good to see these people securing the funding they need for the properties they want, it clearly shows that these measures have had the opposite than intended effect.
“Instead of cooling the market, they have driven demand and encouraged a spike in investors, ultimately pushing up prices and making homeownership a more unaffordable concept for many.
“To resolve our housing crisis, we need to focus on boosting supply rather than dampening demand.
“We are simply not building enough homes to meet the housing needs of our population, and we want to see more action from the government, working together with construction firms, to boost the supply of affordable homes across the country by building at least 250,000 homes a year.
“That way, not only will house prices increase at a more sustainable rate, but we’ll also see lending continue to rise as more people are able to secure a home.”
John Phillips, group operations director of Spicer Haart and Just Mortgages, added: “According to the CML’s latest figures, landlords borrowed £7.1bn which is up 87% month-on-month. It is likely that this surge in activity was caused by the government’s change in stamp duty rates for second properties that came into effect in April, with many approved applications being completed before the deadline.
“Although the dust has started to settle on this recent change, we are likely to see further distortion in the mortgage market due to the impending EU referendum which will inevitably weigh on sentiment and could affect the economy as a whole.
"It is of course difficult to gauge exactly what will happen before and after the referendum, but it is widely anticipated that lending will return to more ‘normal’ levels in the coming months.”
