British net mortgage lending indicated a sharply slowing housing market with net mortgages rising just £1.415 billion sterling in September compared with £1.959 billion the previous month, data released by the Building Societies Association showed.
The September figure is the lowest since May.
In addition, there was also a slump in new mortgage approvals, which saw the smallest rise since January. The figure which shows the level of loans agreed, but not yet made, rose just £2.806 billion in September, well short of the £3.638 billion the previous month.
After seasonal adjustments the figure looked even worse, with approvals at only £2.642 billion - the lowest level in 3 years.
Commenting on the mortgage market, Mr Adrian Coles, director-general of The Building Societies Association said:
"This month there is further evidence of a slowdown in the housing market and recent interest rate rises are starting to take effect. Net advances reflect borrowing decisions of the late summer and are down 28 per cent from last month."
"In addition, approvals are also falling, and, seasonally adjusted, are the lowest for three years. We should expect a gentle downward trend in lending through to the end of the year," Mr Coles added.