The value of new mortgage commitments in the first quarter rose by 12% compared to the previous quarter to reach £78bn, but the value of mortgages advanced during the three-month period dipped by a similar amount.

The latest Bank of England figures show the value of gross mortgage advances fell by more than 12% from the previous quarter to just under £70bn.

Of the 91% of mortgage advances that were to owner occupiers, the share of loans that were for remortgage rose by 2.7 percentage points (pp) from the previous quarter and by 6.8pp year on year to 28%.

The share of owner occupier advances that were for purchase fell by 3.9pp on the previous quarter and by 8.6pp year on year to around 58%.

Within this first-time buyer advances and home mover advances both dipped.

The share of gross mortgage advances for buy-to-let increased by 0.5pp from the previous quarter and by 0.8pp year on year to almost 9%.

National Association of Estate Agents Propertymark president Mary-Lou Press says: “These figures present a mixed picture for the UK’s mortgage market. 

“While the value of gross mortgage advances fell during the quarter, the increase in new mortgage commitments suggests borrowing activity could strengthen in the months ahead.

“It is encouraging to see a modest increase in the share of buy-to-let mortgage advances despite significant legislative changes affecting landlords across the UK. 

“However, many property investors remain cautious about the impact of reforms such as the Renters’ Rights Act and the Housing (Scotland) Act, and it remains to be seen how these changes will influence investment decisions over the longer term.

“At the same time, ongoing cost-of-living pressures and global economic uncertainty continue to influence borrowing decisions. 

“With the Bank of England’s next base rate decision approaching, the housing market will be watching closely for any impact on affordability, confidence and future market activity.”

Phoebus Software chief sales and marketing officer Richard Pike says: “The figures indicate the mortgage market made a steady start to 2026.

“The fall in gross mortgage advances shows the market was still weak at the start of the year, but the rise in commitments shows that confidence was picking up in Q1 before the market shocks caused by the Iran conflict.

“There was a continued shift towards remortgaging as a significant number of borrowers reached the end of fixed-rate deals. 

“This will remain a defining feature of the market throughout the year, as households continue to adapt to a higher rate environment.

“Encouragingly, arrears continue to trend downwards, and are at their lowest since Q3 2023, highlighting the resilience of borrowers despite ongoing affordability pressures. 

“This will provide reassurance to lenders that, while cost pressures persist, most customers are managing to stay on top of their repayments.”

Pike adds: “We saw a gradual increase in possession activity, although the numbers remain lower than last year. 

“While I don’t believe its cause for alarm, it’s important that lenders remain vigilant and ensure their servicing teams are equipped to support those customers who may still be vulnerable.

“Looking ahead, the key challenge for the market will be balancing affordability constraints with the need to support lending growth. 

“While I expect to see modest growth over the course of the year, sustained momentum will depend on further improvements in consumer confidence and greater certainty around the interest rate outlook.”