Housing market is hotting up once more

Some 44,488 mortgages with a total value of £7.7 billion were approved for house purchase in June, marking the highest monthly figure recorded since March 2014, according to the British Bankers' Association.

Meanwhile, the body said it has also seen an increase in the number of people re-mortgaging, which could be due to borrowers wanting to snap up cheap fixed-rate mortgage deals ahead of a possible rise in interest rates. Bill Brookes, of Shropshire estate agents DB Roberts, said: "The market is certainly very strong, although I don't know if it's flying.

"We had a very busy May and June, and I think everybody else did as well.

"Because lending lags behind the market, following on from market activity, what the BBA is reporting is catching up on what happened since the election, when the market has been strong.

"Generally speaking there's not enough new stock coming onto the market, and that's leading to pressure on prices, and people are willing to pay higher prices."

The number of re-mortgage approvals has leapt by around one fifth (20 per cent) compared with a year ago, with 23,985 re-mortgage approvals with a total value of £4 billion recorded in June. The housing market recovery took off strongly in early 2014, but there were signs of a slowdown in the second half of last year after stricter mortgage lending rules were introduced to make sure mortgage applicants could truly afford to pay back their loans.

However, in recent months a mortgage price war has broken out between lenders, with many slashing the rates on their deals to the lowest they have ever offered.

Some experts believe these ultra-low rates may not be around for much longer. Earlier this month, Bank of England governor Mark Carney suggested that the base rate could start to increase from its 0.5 per cent low around the turn of this year.

Mark Harris, chief executive of mortgage broker SPF Private Clients, said: "The real growth in lending has been on the re-mortgaging side, with borrowers keen to snap up a cheap fixed-rate mortgage. With Mark Carney's recent comments about a potential rate rise, we expect to see significant growth in the number of people re-mortgaging."