During the same period the number of approvals for remortgaging increased slightly, to around 49,700.
Net lending for mortgages increased to £4.1bn in March while mortgage approvals for house purchases fell to 62,300, The Bank of England’s Money and Credit data has found.
During the same period the number of approvals for remortgaging increased slightly, to around 49,700.
Kevin Roberts, director, Legal & General Mortgage Club, said: “Amid wider uncertainty activity in the mortgage market remains steady.
“The growing number of products available and increasingly competitive rates, particularly at 95% loan to value, continue to entice those looking to take their first steps.
“Similarly, with many borrowers’ two-year fixed terms coming to an end last month, we expect to see growth in remortgage activity as they hurry to lock into competitive rates while they last.
“For any borrowers who are looking for their first or next mortgage, speaking with an independent mortgage adviser is prudent.
“Good advice is vital in the mortgage process. Advisers can help borrowers each step of the way to find the right mortgage for their needs, not simply the cheapest, while also recommending the protection they need should the worst happen.”
The annual growth rate of mortgage lending was 3.3%. It has been around 3% since the beginning of 2016 and remains modest compared to the pre-crisis period.
Households borrowed an extra £4.1bn secured against property in March, compared to £3.3bn in the previous month.
Andrew Montlake, director of mortgage brokerCoreco, added: “While mortgages approved for house purchase dipped slightly in March, expect that figure to improve significantly in April as the past month has seen a sharp pick-up in activity levels
“The two main pillars supporting the mortgage market are first time buyers and existing homeowners remortgaging onto better rates. Remortgage activity in particular is thriving.
“Competition among lenders has rarely been as intense as it is at present, with products priced ever more competitively and a slight relaxation in loan criteria
“Crucially, far more products are being created at higher loan to values, which is really empowering first time buyers and giving them a genuine leg-up.
“A mixture of lower house prices, Help to Buy, fewer amateur landlords and better mortgage rates at 90% and 95% LTV is incentivising first time buyers on a level not seen for years.
“Lenders are being more accommodating with their criteria and this is making affordability less of an issue compared to a year ago.
“The underwriting is still responsible but there’s a definite improvement in criteria. Loans that might have been rejected a few months ago are now getting across the line as lenders compete to get money into the market.”
Jonathan Harris, director of mortgage broker Anderson Harris, said: “With mortgage approvals falling, suggesting future mortgage lending will be subdued, clearly Brexit uncertainty is still having an impact on people’s decisions to buy and sell.
“The fact that the increase in consumer credit was at its lowest rate since November 2013, while encouraging, shows that people are being more cautious and holding off from spending on big ticket items, such as upgrading the car.
“That said, mortgage lending picked up in March compared with February as some people got on with buying and selling their homes regardless.
“Much of the activity was down to remortgaging as borrowers locked into some of the competitive fixes currently available to protect themselves from potential future uncertainty.”
