Mortgage lending reached its strongest levels since 2008 last year as the housing market ended 2016 on a "positive note", according to banks and building societies.
The Council of Mortgage Lenders said an estimated £20.4 billion-worth of home loans were handed out in December, bringing the estimated total for the whole of 2016 to £246 billion.
The total for 2016 is 12% higher than 2015, when mortgage lending reached £220 billion, as well as being the highest figure since 2008 - when around £248 billion was advanced.
CML senior economist Mohammad Jamei said: "The UK housing market, much like the wider UK economy, ended 2016 on a generally positive note.
"Approvals for house purchase have recovered strongly of late, and this should feed through to lending figures in the early months of 2017.
"The current availability of mortgage credit is benign, and the real issue continues to be a dearth of properties on the market, which adds to the challenges facing would-be buyers.
"Uncertainty associated with political factors and prospective changes to the tax treatment of landlords will weigh on prospects for the year ahead."
Figures released by the British Bankers' Association (BBA) on Thursday showed approvals for re-mortgage lending surged to an eight-year high in December as home owners moved to snap up cheap rates ahead of any possible rise.
The BBA's figures showed that while total re-mortgage approvals across 2016 were up on the previous year, the total number of mortgages being approved for house purchase was down last year compared with 2015.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: "2016 turned out to be an encouraging year for the mortgage market, despite significant headwinds created by the increase in stamp duty for landlords and second home owners in April and the uncertainty surrounding the referendum.
"Record low mortgage rates were responsible for this resilience, with many borrowers re-mortgaging to take advantage of the lowest rates ever - while first-time buyers were able to take advantage of an increase in the number of high loan-to-value deals."
Mr Harris said HSBC, Barclays and Aldermore have all launched cheaper rates this week, in further signs of lenders' appetite to attract customers.
Jeremy Leaf, a north London estate agent and a former residential chairman of the Royal Institution of Chartered Surveyors (Rics), said the figures are "positive news", adding: "What we are seeing on the ground are fewer, but more serious, buyers."