Mortgage approvals increased in January for both house purchase and remortgaging, to 67,478 and 49,242 respectively, The Bank of England Money and Credit data has found.
Meanwhile annual growth in secured lending was unchanged at 3.3% in January with net lending at £3.4bn.
Jonathan Harris, director of mortgage broker Anderson Harris, said: “Lacklustre borrowing figures from the Bank of England provide more evidence of a stuttering housing market.
“However, it could also be argued that lending is holding up remarkably well, given the uncertainty created by Brexit, with net mortgage borrowing mostly unchanged, just dipping slightly below the £3.9bn average of the last six months.
“While these numbers are historic, mortgage approvals indicate what is coming up in the market and suggest a pick up in activity, although again only slightly. It seems that Brexit is still weighing heavily on people’s minds and affecting their ability to make a decision to move one way or another.
“However, the uncertainty is also encouraging remortgaging, with borrowers seeking security and protection against potential further rate rises. Lenders are still keen to lend and mortgage rates are likely to remain competitive for the foreseeable future.”
Andrew Montlake, director of mortgage broker Coreco, added: “Many prospective buyers are waiting for more certainty but ironically it’s the current uncertainty that is strengthening their hands.
“They are waiting for a window of opportunity and may be disappointed when they discover that this was it.
“The mortgage market is being driven by remortgages and first-time buyers, who are benefiting from Help to Buy, reduced landlord competition, a strong jobs market and the Bank of Mum and Dad.
“For first-time buyers, in particular, now is a perfect time to buy, something that is almost certainly underlined by the rise in approvals for house purchase in January.
“There is so much competition in the market that a growing number of lenders are shifting their attention towards higher LTV loans and rates are coming down as a result. This is providing a real boost to first-time buyers.
“Right now, buyers hold all the cards and sellers are increasingly waking up to the fact that if they want to sell, they need to lower their asking prices.
“There is still a disconnect between the expectations of buyers and sellers, but it is considerably less pronounced.
“What we’re also seeing is a lot of pent-up demand come through. People have been holding off for quite some time and are now finally starting to act.
“While it’s a buyers’ market at present, that could change almost overnight in the event that a deal is struck with Brussels.”
However, Jeremy Leaf, north London estate agent and a former RICS residential chairman, was more positive, looking to approvals he has seen.
He said: “As far as we are concerned, not much change is very good news because these figures are a useful indicator of what was happening in the months leading up to Christmas when Brexit uncertainty was at a high.
“The positive sign for approvals confirms what we have seen on the ground – in other words, no fireworks but plenty of solid activity among buyers and sellers who are prepared to negotiate hard to find a compromise which builds in perceived risk and is seen as fair to all.”