Figures from LMS showed the number of loans also rose by a fifth in the first month of 2015. Loans reached £4.07bn in the month, up from £3.4bn in December.

Remortgaging accounted for 28% of the whole mortgage market in January, the biggest share of the market since September 2013.

This was equivalent to 26,756 loans completed, down 7% compared to the first month of last year.

The total amount of equity withdrawn by remortgaging was up 40% year-on-year, reaching £509m.

Andy Knee, chief executive of LMS, said the remortgage market had faced a difficult year but that the outlook for the market in 2015 was brighter.

“2014 was a mixed year for the remortgage market as the introduction of MMR and tighter controls from the Bank of England took their toll,” he said.

“A strong start to 2015 as people tackle their finances at the beginning of the year is a positive sign but we should not become complacent as challenges to the housing sector remain.”

Knee said rates in the remortgage market were also improving.

“Furthermore, the competitive rates available for remortgaging, coupled with rising wages, means that repayments now account for just 18.8% of income – the lowest amount since January 2011,” he added.

“This combined with the current deflation of prices should further boost household spending power and contribute to confidence in the economy.

“The run-up to the election has the potential to destabilise the confidence gained in the housing market but low interest rates should maintain lender appetite, and people should consider remortgaging to get the best deal available to them.”