There was £4.6bn worth of net mortgage borrowing by UK households in December, a rise above the £4.2bn average registered over the past six months, according to new statistics published by the Bank of England (BoE).

The BoE’s latest Money and Credit Statistical Release revealed that despite recording stronger flows, the annual growth rate for mortgage borrowing remained at 3.4%.

The data revealed that mortgage approvals for house purchase – which the BoE uses as an indicator for future lending – also picked up in December, to 67,200, a figure above the 65,900 average of the past six months.

Remortgage approvals also showed a slight rise on the month to 49,700, which CEO of the equity release lender more2life, Dave Harris, suggested might be due to ‘current homeowners preferring to stay put’ in their homes, rather than move.

“Particularly before the impact of today’s move out of the EU on the housing market is really understood,” Harris added.

“In particular, for older homeowners who need to adapt their home to suit their needs in retirement, remortgaging may be especially appealing. However, alternatives exist that can give these consumers the funding they need to age-proof their home, such as equity release.

“Indeed, 61% of more2life customers have said they’ve taken out an equity release loan to fund home improvements.”

Commenting on the BoE figures, Phoebus Software sales and marketing director, Richard Pike, added: “The increase in house purchases is something that the industry has been waiting to see. Last year, the bulk of activity was for first-time buyers and remortgages, so it would be very interesting to see what proportion of the recent house purchase approvals were for first-time buyers against that for home-movers.

“With Key’s recent Equity Release Market Monitor revealing a drop in the number of equity release transactions last year, it appears that the market is shifting in all directions, and maybe this shift is actually a sign of things coming back into balance.”

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