Bank of England figures reveal that in February there were 87,700 mortgage approvals - down from a peak of 103,700 in November but still above long term averages.
The Bank also notes that February's was the smallest monthly figure since August's 86,085.
Even so, market experts remain relatively upbeat.
Hometrack managing director David Ross says: “We remain optimistic that interest for mortgages still remains strong, in light of the 95% mortgage guarantee, the return of high LTV mortgages across the market, the successful roll out of vaccinations, and imminently the easing of lockdown restrictions.
“The market is unequivocally buoyant and we can see from Hometrack data that there are strong indications of committed demand, with mortgage applications continuing to rise. We expect the following months to see an increased rise in mortgage approvals as we have witnessed a six per cent increase in mortgage applications in March, compared to September 2020, which was our peak in volumes over the past 12 months.”
And Jeremy Leaf, the north London estate agent and former RICS residential chairman, says the dip in approvals is unsurprising: “These are always a good indicator of future market direction and the dip occurred as many thought that benefiting from the stamp duty concession would be impossible in view of the backlog.
“However, since the deadline was extended and vaccination rollout has taken off, the market has gained new impetus and more balance as sellers in particular are not as fearful of welcoming visitors to their homes.”
Nitesh Patel, strategic economist at the Yorkshire Building Society, says: “It still suggests demand is strong. It is likely that many buyers were trying to take advantage of the stamp duty holiday before it ended in March, which has since been extended until the end of June.
“The market has been on an upward trajectory, despite rising house prices and continued economic uncertainty, with buyers refusing to be deterred from the buying the biggest ticket item of them all.
“There is growing evidence that larger homes are currently the most desirable: since March 2020, sales of detached homes have grown from 22 to 28 per cent of all transactions. Flats now account for a smaller share at 12 per cent, down from 17 per cent over the period.”