Overall, gross lending to individuals for properties topped £20bn in December for the first time since March when it hit £27bn. The £20.1bn total for last month was also £800m higher than December 2015.
The steady remortgaging growth in the final quarter of 2016 was put down to record low interest rates by industry commentators.
The last three months of 2016 witnessed an average of 45,900 remortgages per month, compared to an average of just 41,800 in the first nine months of the year.
However, while lending decisions to first-time buyers also improved in the final quarter, they were still down more than 2,000 at the same point in 2015.
Mark Harris, chief executive of mortgage broker SPF Private Clients, called the trends “encouraging” and added that 2016 had been a surprisingly good year for the market, particularly considering the increase in stamp duty for landlords and second homeowners in April and the uncertainty surrounding the referendum.
“Record low mortgage rates are responsible for the resilience we have seen, with many borrowers remortgaging to take advantage of the lowest rates ever,” he said.
“Meanwhile, first-time buyers have been able to take advantage of an increase in the number of high loan-to-value deals and despite fears that the end of the Help to Buy mortgage guarantee scheme would give them a massive setback, this doesn’t seem to be the case.”
He added that lenders were showing an appetite to do business, with HSBC, Barclays and Aldermore launching cheaper rates in the past few days.
However, he urged lenders to provide more flexibility for non-standard borrowers, adding: “we would like to see more tweaking of criteria and innovation to make it easier for other groups such as older borrowers and the self-employed to access mortgage finance rather than just cheaper rates.”
Legal & General Mortgage Club director Jeremy Duncombe echoed Harris’ views on the lending data.
“The Bank of England’s figures clearly show a strong end to the year for the mortgage market. It is particularly encouraging to see so many savvy borrowers taking the initiative and saving themselves a potentially significant sum of money by swapping their existing mortgage deal,” he said.