Net mortgage borrowing hit a record £17.9bn in June, new figures published by the Bank of England (BoE) have revealed.

The previous record, set in March 2021, stood at £11.5bn.

The BoE’s data showed that borrowing has averaged £5.4bn in the 12 months to May 2021, and the bank suggested this latest increase was driven by borrowing ahead of the tapering off of the lower stamp duty rates from July.

There has also been a shortening of time between a mortgage being approved and the lending itself, the BoE stated, after reporting no large rise in the number of mortgage approvals in recent months, unlike ahead of the strong net borrowing in March. Gross lending increased to £43.8bn, with gross repayments also increasing to £27.7bn.

Commenting on the figures, Just Mortgages and Spicerhaart national operations director, John Phillips, said: “The housing market continues to show us how buoyant it is. Even with the slight dip in activity, it’s still a great time to be a broker.

“Although the market is cooling as the stamp duty holiday deadline has come and gone, we are still witnessing an incredibly active market. Borrowing reached a record high in June, which is unsurprising when we consider that house prices have experienced a surge this year.

“Even without the stamp duty holiday, there is still a wave of buyers looking to move and this will undoubtedly drive activity until at least the end of the year.

“It’s an exciting time to be a broker, and this morning’s figures only reaffirm that message.”

Elsewhere, the figures showed that approvals for house purchases, an indicator of future borrowing, decreased in June to 81,300, having sat at 86,900 in May. This is the lowest tally since July 2020 but remains above pre-February 2020 levels.

Approvals for remortgage, which only capture remortgaging with a different lender, jumped slightly to 35,400 in June, up from 34,800 in May. The bank stated that this remains low compared to the months running up to February 2020.

Phoebus Software sales and marketing director, Richard Pike, added: “There is one factor that is likely to keep the market moving for both purchase and remortgaging, and that is mortgage interest rates and the current flurry of fixed-rate deals that are being announced on an almost daily basis.

“It appears that lenders are determined to keep the momentum going, and with two-year fixes as low are 0.75% there is plenty of incentive for borrowers.

“With high street banks and building societies reporting record mortgage growth this year, there is plenty of scope for these historically low-interest rates and we can expect to see more and more tempting deals.

“We are already seeing remortgage activity gaining momentum, as the supply of properties coming to market slows. As current fixed rates come to an end we may see the pendulum swing from record purchase levels back to a growing remortgage market.”

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