Almost 30,000 novice buyers swung onto the housing ladder in one month and the number of home movers in general also rose 10% month-on-month with £6.5bn of lending to hit the highest October lending total since 2007.
Gross mortgage lending in October reached £18.6bn, which is a 6% rise on October last year from £17.5bn.
House purchase lending to home-buyers increased month-on-month in October totaling 65,000 loans. This was up 11% compared to September with the value of these loans totaling £10.9bn, a rise of 9%. Compared to October 2013, the number of loans increased by 9% and the value of lending by 15%.
Buy-to-let continued its run as the golden boy of the mortgage sector with lending of £2.7bn and a year-on-year increase in loans of 22% and value of 29%, with 19,600 buy-to-let loans in October.
In contrast, remortgage figures continued to fall to 26,000, or down 11% on the previous year.
Paul Smee, director general of the CML, said: “This has been a year of change for our industry, but the market has shown remarkable stability with house purchase and buy-to-let lending showing steady, consistent growth throughout 2014 compared to 2013. There have been fluctuations month to month but overall the market appears to be showing a positive direction of travel going into the new year.
Smee added: “Stamp duty reform was long overdue and it is welcome that the tax has been changed. It will now be interesting to see how the market reacts; the new structure should be less of a barrier to mobility for those looking to get on the housing ladder or movers looking to switch homes.”
Peter Williams, executive director of the Intermediary Mortgage Lenders Association (IMLA), said 2014 has shored up the foundations of the mortgage market, with gross lending of around £210bn in sight.
“The looming election and interest rate rise are both important factors that will impact the growth potential of the market in 2015. One safe bet is that brokers will be kept busy as the balance of power and influence shifts in their direction.”