First-time buyers borrowed £4.6bn for home-owner house purchase, up 10 per cent on September and October last year, according to the Council of Mortgage Lenders’ latest figures.
This totalled 29,900 loans, up 8 per cent month-on-month and 3 per cent year-on-year.
Home movers took out 35,400 loans, up 9 per cent month-on-month and 3 per cent compared with October 2014.
In total, this was £7.1bn borrowed, up 8 per cent on September and 13 per cent year-on-year.
Home-owner remortgage activity also increased, up 6 per cent by volume and 10 per cent by value, compared with September.
When contrasted with October 2014, remortgage lending was up 19 per cent by volume and 34 per cent by value.
Gross buy-to-let also saw month-on-month increases, up 4 per cent by volume and 3 per cent by value, but more substantial growth year-on-year.
Buy-to-let loans for house purchase were up by a third compared to the same time last year and up 47 per cent for remortgages.
Paul Smee, director general of the CML, said home-owner and buy-to-let activity both continued the upward trend seen last month, meaning the market looks set to finish the year strong, despite taking time to gain momentum after a slow start to 2015.
“With increasing employment and the current absence of inflationary pressures in the UK, conditions for continuing demand in the housing market seem likely going into the new year. How supply will respond to this challenge going forward is a crucial question for 2016.”
Mark Harris, chief executive of mortgage broker SPF Private Clients, added lenders will have a keen eye on year-end targets, so there are some very competitive deals to tempt borrowers.
“Even though a handful of lenders have raised rates in the last week, this may be more to do with trying to control business volumes over the festive period rather than evidence of the start of an upwards trend in pricing.
“We still expect plenty of competitive rates in the January sales, many aimed at those coming up to remortgage who may be concerned that interest rates might finally rise next year,” he added.
Meanwhile, Office for National Statistics data showed UK house prices increased by 7 per cent in the year to October, up from 6.1 per cent in the year to September.
House price annual inflation was 7.4 per cent in England, 10.3 per cent in Northern Ireland, 1 per cent in Wales and 0.9 per cent in Scotland.
Annual house price increases in England were driven by an annual increase in the east (10.4 per cent) and the South East (9.5 per cent).
Excluding London and the south east, UK house prices increased by 5.6 per cent in the 12 months to October.
peter.walker@ft.com
