In September, mortgage lending totalled an estimated £12.5bn, a 2% rise from the £12.3bn recorded in August.
While there has been a pick up in house purchase activity, this has been offset by the decline in remortgaging.
Paul Samter, economist at the CML, said house buying activity is running at considerably higher levels than at the start of the year.
However, he warned: “It remains weak on any historic comparison and is unlikely to rise much further given the constraints the lending community faces and a still difficult economic backdrop.”
In a further sign of positive news for the market, Samter said the wholesale markets have begun to thaw in recent weeks with institutions such as Lloyds Banking Group (LBG) able to issue structured finance products backed by mortgages.
“This is only an early sign of wholesale investors tentatively coming back into the new issuance market, but is welcome nonetheless,” he added.
