Gross advances in the UK residential market will grow 12.89 per cent to 324 billion in 2010 from 287bn last year, according to independent analyst Datamonitor.
However, it sounded a note of caution, claiming the market would experience a couple of tough years before growth accelerated from 2008.
Lenders would also have to contend with the threat of increasing bad debts and costly regulation over the next two years.
The report was published as new research revealed that almost half of all first-time buyers now rely on help from their family to get on the property ladder.
Some 46 per cent of people in their 30s are given or loaned a deposit for their first home, usually by parents or grandparents, according to the Council of Mortgages Lenders (CML), a 10 per cent rise in ten years.
A string of recent data has pointed to a housing market revival, following a slowdown on the back of rising interest rates, record personal debt and dwindling consumer confidence.
Datamonitor anticipated flat advances this year and next, followed by rapid growth. It believed lending would reach 138.5bn in house purchases, 140.9bn in remortgaging and 44.7bn in secured lending by 2010.
However, it warned that bad debt had become a greater concern for lenders.
"The worry is that, should consumers start to buckle under the weight of their debts, bad debts could rise, hurting lenders' overall profitability," said Maya Imberg, a financial services analyst and author of the report.
The rising cost of regulation was putting further pressure on lenders, she added.
Meanwhile, the CML said the typical "assisted" first-time buyer had an annual salary of just 25,000, but was able to buy a property worth around 136,500 and put down a 34,200 deposit.