Loan approvals for house purchase in Britain rose last month to their highest level since January 2012, and net mortgage lending rose by the biggest amount since April, Bank of England figures showed on Wednesday.
The data suggests that the central bank's Funding for Lending Scheme - which went into operation in August - may be starting to raise the outright amount of money being lent to home buyers.
The central bank has been hoping that the FLS would boost the flow of credit to households and businesses and support an economy now perilously close to a "triple-dip" recession.
Evidence of benefit for businesses in Wednesday's data was less clear, though one measure of lending to firms posted its smallest annual percentage fall since November 2011.
The figures showed that mortgage approvals rose to 55,785 in December from 54,011 in November. This was above analysts' expectations and the highest figure since January 2012, when the imminent end of a government incentive for first-time home-buyers boosted demand.
Net mortgage lending increased by 1.036 billion pounds, the largest amount since April, and interest rates on new secured loans to households fell to their lowest since April as well.
Before the 2008 financial crisis, monthly mortgage approvals ran at around 90,000, but the number of home sales has slumped since then and the property market has largely ceased to be a major driver of consumer spending.
Last week similar data from the British Bankers' Association showed a tick up in mortgage approvals in December, although they were 4 percent down on the year.
Overall net household lending rose by 1.685 billion pounds after stagnating the month before. Within that, unsecured consumer lending rose by 649 million pounds, the biggest rise since September and a much stronger increase than forecast.
A quarterly BoE survey found that British banks planned to increase the supply of mortgages in early 2013 after a record rise in the availability of this type of credit in the three months to December. The poll also pointed to an improvement in terms on which loans are extended.
The BoE's preferred gauge of money supply, M4 excluding intermediate other financial corporations, rose 5.2 percent on the year, the sharpest rise since the second quarter of 2008..
Britain's economy shrank more than expected at the end of 2012, with a slump in oil production, lower factory output and a hangover from the London Olympics pushing it to the brink of its third recession since 2008.
(Reporting by Olesya Dmitracova and David Milliken)