First-time buyers returned in force in December to borrow £4.5 billion, a rise of 18% on one year ago.

This also marked a rise of 7% on November while the number of first-time buyer loans totalled 29,300, up 11% year-on-year.

Latest monthly lending trends from the Council of Mortgage Lenders also showed that home movers borrowed £6.6 billion in December, up 20% year-on-year.

Homeowner remortgage activity fell 16% by volume and value compared to November.

Jonathan Harris, director of mortgage broker Anderson Harris, said: “First-time buyers continue to go from strength to strength, with lending at its highest in eight years.

“A plethora of mortgage deals at high loan-to-values, combined with government schemes such as Help to Buy, is making it easier to get on the housing ladder than has been the case for a long while.”

Harris said the figures show that confidence is also high among borrowers generally.

“They have good reason to believe that interest rates are likely to remain low for many months to come and with plenty of cheap competitive mortgages to attract them, many believe that now is a good time to borrow or remortgage.”

Steve Griffiths, head of sales and distribution at Kensington, said: “2015 was the year the mortgage market took a significant step towards a new normal.”

He warned that many were still locked out of the market. “It is vital that we are able provide opportunity for creditworthy individuals whose circumstances do not tick the boxes of a standard mortgage application.”

Adrian Whittaker, sales director, New Street Mortgages, said that lenders also need to recognise the regional nature of the housing market.

“Products should suit the needs of borrowers across the country, offering for example, superior rates that recognise the lower likelihood of voids in high demand areas like London and the South East.”