The mortgage market displayed “welcome signs of life” in August, although not to the extent of signalling a housing boom.
Around 52,000 home loans were given for house purchases, according to the Council of Mortgage Lenders (CML), a 7 percent increase on July.
Remortgaging was also on the rise, with a 30 percent increase from the same month the previous year.
The CML said though that fears over the UK and European economies were hurting confidence in the housing market.
The Royal Institute of Chartered Surveyors said that fragile consumer confidence was preventing many people from putting their properties up for sale.
Whilst house prices have remained static in recent months, there are signs that increased mortgage borrowing could stimulate house sales this autumn.
The Bank of England recently said that mortgage approvals were at their highest level since December 2009.