Data from the Bank of England showed there were 76,947 mortgage approvals in January, up from 72,798 in December and an average of 67,461 over the previous six months to reach the highest level since November 2007.

The number of approvals for remortgaging reached 36,398 last month, up from 35,135 in December 2013.

Andy Knee, chief executive of property services company LMS, said: “Mortgage lending in January raced past the average we’ve seen over the past six months, with house purchase loan approvals up over 5,000 since December. This strong start to the year sets the market in a hugely positive position for the months ahead, as thousands of savvy customers continue to take advantage of the plethora of attractive deals on offer that are energising the market.

“Similarly, remortgage lending also shot past its six month average continuing the resurgence we saw at the tail end of last year. With more customers taking heed of the range of products and rates available, remortgaging is now occurring at its most frequent since October 2009. We’re likely to see lending volumes continue the upwards ascent in the next few months until MMR kicks in – which could temporarily put the brakes on while the changes settle in.”

The figures come amid news that the average UK house price has reached £250,000, leading to concern of a housing bubble.

However, the Bank of England said last year it would intervene if it felt property prices were overheating.