Homeowners paid off a record amount of their mortgage in the first quarter of this year, figures show.

According to statistics from the Bank of England, and estimate £8.1 billion was repaid, bringing the total to £23bn for the year to the end of March.

Since the beginning of 2008, falling house prices and strict mortgage rationing have prevented homeowners from borrowing extra on their mortgages. During the previous housing boom, borrowers had taken out more than £300bn extra against the rising value of their homes since 2000.

“This is not a surprise given the fall in house prices over the period, and will have contributed in no small way to the weakness in High Street spending,” said Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors (Rics).

“It is improbable that housing capital, in the near term, will be viewed as a source of wealth that can be drawn down by home owners to supplement their income,” he added.

The Bank of England said that the switch from extra mortgage borrowing to the expansion of equity held by homeowners was not necessarily evidence of a conscious decision by borrowers to pay off some of their loans. Rather, it was mainly a reflection of lenders requiring larger deposits when homeowners take out a mortgage, thus producing a greater injection of equity into the property.

Separate figures from the financial information service Moneyfacts reveal that mortgage providers have eased lending slightly in the past month. At the beginning of July there were 119 mortgage deals available which asked for only a 10% deposit. This is far fewer than a year ago, but up from 101 such deals last month.

At the beginning of May 2008, mortgages requiring a 10% deposit made up 40% of all mortgage deals on the market. However, a massive squeeze on lending means that 10% deposit mortgages make up just 7.5% of home loans available today, with 65% of deals now requiring a deposit of at least 25%.

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