"They reflect a rather mixed economic picture - one month up, one month down - but show a property market which is relatively uncertain as we approach the crucial spring period"
The number of total mortgage approvals has also fallen and is 15% lower, with house purchase approvals falling by almost 21% compared to March 2017.
Henry Woodcock, principal mortgage consultant at IRESS, commented: “After a decline in mortgage approvals in February, a modest increase in lending was expected in March, so an increase of 8.3% from the previous month has exceeded expectations.
"Looking at the figures from the same period last year, things don’t appear to be so good though. Total mortgage approvals have dropped by 15%, with house purchase approvals falling by almost 21%.
"There has been some positive movement in the market however, with first time buyer and home mover activity increasing and borrowers looking to re-mortgage to fix their costs before an expected May interest rate rise.
"The RICS housing survey published this month indicates that the slowdown in the housing market continues, as March was the twelfth consecutive month showing a drop in buyer demand. This downward trend has been more prevalent in southern and London markets.
"House price increases have also slowed, as consumers show more caution with continuing economic and political uncertainty and affordability has been hitting borrower limits in some locations. Also, as the stamp duty and tax relief changes impact the buy to let market, an increasing number of landlords are looking to exit.
"The outlook for the months ahead will depend on whether there is an interest rate rise. And if there is, will it stimulate the remortgage market, or reduce affordability for first time buyers?”
Jeremy Leaf, north London estate agent and former RICS residential chairman, added: "Never was it so important not to put too much reliance onto one month’s numbers as only a few days ago we were commenting on the positive lending data for February rather than these slightly negative approvals. Needless to say, they reflect a rather mixed economic picture - one month up, one month down - but show a property market which is relatively uncertain as we approach the crucial spring period, which is usually the busiest time of the year.
"At the coalface, what we have been finding since March is that there are more properties coming onto the market and buyers and sellers are negotiating hard to establish what both parties consider is a fair market figure in the new environment. Clearly any imminent increase in interest rates is not going to help an already fairly sensitive property market."
