The Bank of England has revealed that net borrowing of mortgage debt by individuals totalled £7.0 billion in March, up from £4.6 billion in February.

Mortgage approvals for house purchases were little changed at 70,700 in March, and remains above the 12-month pre-pandemic average up to February 2020 of 66,700.

Consumers borrowed an additional £1.3 billion in consumer credit, on net, of which £0.8 billion was new lending on credit cards.

The effective interest rate paid on individuals’ new time deposits with banks and building societies rose by 16 basis points to 0.92%.

Meanwhile, large businesses’ borrowing from banks fell to £1.9 billion in March from £4.3 billion in February, while small and medium sized businesses repaid £0.7 billion of bank loans. Private non-financial companies (PNFCs) redeemed £6.5 billion in net finance from capital markets.

Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “The Bank of England records a pick-up in net borrowing of mortgage debt in March, while mortgage approvals were little changed and remain above the 12-month pre-pandemic average. This suggests that the froth has come out of the market, leaving a calmer, more measured, and ultimately more sustainable version.

“With the markets expecting another interest rate rise this month, brokers are being kept busy. Borrowers are increasingly concerned about rising mortgage rates and are keen to secure a fixed rate in particular before they rise further. With lenders pulling some deals with little or no notice, decisions have to be made quickly.”