The Bank of England’s latest lending statistics have shown that mortgage approvals for house purchases rose to 62,932 in September.

Andrew McPhillips, chief economist at the Yorkshire Building Society, said: “The fact that lending has increased compared to the same month last year despite mortgage approvals falling is most likely a result of increasing house prices, which have caused people to take out larger loans to afford a property.

“Remortgaging is also accounting for an increasing proportion of market activity as people are looking to make the most of the record-low rates currently available, while house purchase activity is showing a decline as a result of both the lack of supply and increasing house prices which are limiting the number of people who are able to get onto the property ladder.

“The housing crisis is arguably one of the most significant issues facing the UK at present, and is producing an intergenerational divide in wealth. It is not only affecting first-time buyers, but also limiting the number of properties available to existing home owners, potentially leaving them in a home which no longer suits their needs.

“In order to subvert this trend, the UK needs to build more houses to ensure that enough properties are available to buy, and reduce the level of house price inflation.”