Mortgage borrowing increased to £5.9bn in January, according to the Bank of England, up from £4bn in December.

The Bank noted that this is above the pre-pandemic average of £4.3billion in the 12 months up to February 2020, and the highest level of borrowing since September 2021 (£9.4 billion).

The number of mortgage approvals for house purchases rose too, to 74,000 in January.

This was also higher than the pre-pandemic 12-month average up to February 2020 of 66,700 and the highest number of purchase approvals since July 2021 (75,900).

Approvals for remortgaging increased to 46,200 in January. This remains below to the 12-month average up to February 2020 of 49,500, but is the highest since February 2020 (52,300).

Imran Hussain, director at Nottingham-based Harmony Financial Services, said: “The demand for mortgages in January was as strong as ever and carried on from where we left off in 2021, with first-time buyers at the front of the pack.

“However, a few lenders have started to tighten their criteria and lending multiples, especially with the cost of living and inflation spiralling out of control. Inflation is on everyone’s mind currently but for many first-time buyers who are renting, knowing that they will generally save money by owning, which helps combat inflation, is driving them on.

“The standout theme in the market right now is demand outstripping supply. The lack of stock is unprecedented and there is a deluge of offers for each property that comes to market.”

Rob Peters, director of Altrincham-based Simple Fast Mortgage, said his experience wasn’t reflected in the figures: “Demand for residential mortgages dropped off in January compared to the latter stages of 2021,” he explained. “Mortgage lenders began to tighten their proverbial affordability belts as they looked to factor in higher costs of living together with stress-testing applicants based on higher interest rates.

“This is where we will see the largest tempering of the mortgage market in coming months. Potential borrowers’ upper mortgage limits will reduce and ultimately slow the market.”