The British Bankers’ Association (BBA) has revealed that the slowdown in the mortgage market continues, with house purchase approvals 16% lower than in October last year.

There were also fewer approvals for remortgaging and equity release.

The BBA said annual growth in unsecured borrowing is running at 2.8%, the highest rate since 2008.

Richard Woolhouse, chief economist at the BBA, said: “Today’s figures suggest that the cooling of the property market has continued in recent weeks. Approvals were 16% lower in October than in the same month last year – the corresponding figure for September was a 10% decline.

“Despite a softening in the housing market, consumers continue to show confidence in the economy with unsecured borrowing at its highest growth rate in years.

“At the same time we all continue to make the most of new ISA rules, stashing more in our savings accounts over the course of the last year.”

Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “The rate of decline in mortgage approvals is accelerating, with October showing a 16% drop on last October, compared with the corresponding figure for September of a 10% fall. However, gross mortgage borrowing was 2% higher than in October last year, so even though there has been a slowdown in demand, overall mortgage stock continues to rise.

“The Mortgage Market Review undoubtedly slowed down the approvals process, and while numbers recovered in June, they have since slowed again. While there is an astonishing array of rock-bottom fixed-rate mortgages available, this slowdown in activity is unlikely to change until the General Election is out of the way. The uncertainty surrounding the election could mean the market continues to stagnate in the early part of next year, particularly in the £2m-£3m bracket where fears of the introduction of a mansion tax are causing would-be buyers to sit on their hands.

“However, once the election outcome is known, we expect the housing market to be buzzing as all the pent-up demand from the start of the year is released. We expect the year overall to be a strong one, with around £215 billion of lending as demand to borrow and an appetite to lend remain strong.

“The regulator must urgently address the issue of older borrowers, many of whom are now struggling to get a mortgage. It is difficult to fathom why a lender would rather advance 95% loan-to-value to a first-time buyer with no track record than 50% to an older borrower with a 40-year unblemished track record.”