First-time buyers have started taking a bigger share of the market, to the detriment of cash and buy-to-let purchasers.
Trade body UK Finance analysed HMRC data from September that showed the share of first-time buyer transactions had increased from a quarter to almost a third year-on-year, while the number of buy-to-let and cash buyers has dropped.
Cash buyers still make up the highest proportion at 35% of the market in September 2017, albeit down from 37% a year before, while the proportion of buy-to-let owners fell from almost 10% to just over 5%.
The proportion of home movers remained flat at around 30%.
The research accompanied UK Finance data showing mortgage lending increased in October despite the number of loan approvals for home purchase actually falling.
The lender figures showed that £23.1bn was borrowed in October, up 14% year-on-year.
But the number of loans to home buyers actually fell during the month to 40,488, down 3% annually and below the previous six-month average of 41,447.
In comparison, remortgage approvals were up 37% on last year to 34,036.
Mohammad Jamei, senior economist for UK Finance, said the increase in lending was mainly down to remortgage activity, but first-time buyers have also seen a boost, due to low mortgage rates.
He said: “The anticipated bank rate rise saw a flurry of remortgage activity as many home owners took advantage of the competitive rates on offer.
“Borrowing was also boosted by stronger first-time buyer activity as this segment benefitted from good credit availability, lower rates and government housing schemes.”
Commenting on the figures, Henry Woodcock, principal mortgage consultant at financial software provider IRESS, said: “The Bank of England had signposted the raising of interest rates ahead of the decisive monetary policy committee vote in November, which undoubtedly encouraged borrowers and applicants to secure the best fixed rate deals before lenders increased rates.
“Although house prices across England and Wales have slowed in recent weeks, the market has shown remarkable resilience, despite uncertainty around Brexit and base rate increases. But any growth continues to be overshadowed by a lack of supply and, although the government plans to stimulate house building, it will take some time to show its influence.”