THE number of mortgage approvals being made to home buyers fell to its lowest level in more than two years in October.
Some 58,977 home loans were approved - marking the lowest monthly total since June 2020 - according to Bank of England figures.
The total fell sharply from 65,967 mortgages approved for house purchase in September.
Mortgage rates surged following the mini-budget in September, although in recent weeks there have been signs of the market settling down.
A string of Bank of England base rate hikes has also been pushing up borrowing costs.
Commenting on the figures, Marc von Grundherr, director of estate agent Benham and Reeves, said: "The decline seen is almost certainly a consequence of a disastrous mini-budget which still lingers in the air while the market seeks to navigate multiple challenges.
"But we must factor in seasonality too whereby mortgage applications always begin to reduce at the onset of winter."
Jason Tebb, chief executive officer of property search website OnTheMarket.com, said: "Our own figures show sentiment remained remarkably robust in October despite political and economic uncertainty, with 60 per cent of properties sold subject to contract within 30 days of being advertised for sale."
The Bank's Money and Credit report said that approvals for re-mortgaging, which only capture re-mortgaging with a different lender, increased slightly in October, to 51,300.
Alice Haine, personal finance analyst at investment platform Bestinvest, said: "For those with mortgage deals about to expire who haven't locked in a new product, there are more options available now.
"Variable-rate mortgages, for example, are cheaper than fixed-rate deals, however they do track interest rates, making it likely they will go up in the months ahead. However, once rates hit their peak next spring, they are expected to come down, so it could result in short-term pain for long-term gain."
The "effective" interest rate - the actual interest rate paid - on newly drawn mortgages increased to 3.09 per cent in October.
The figures also showed a net flow of £6.4 billion into bank and building society and NS&I accounts in October, which was down from £8.9 billion in September.
But this was still above the average monthly net flow of £5.3 billion during the previous six months, the Bank said.
The annual growth rate for consumer credit - which includes borrowing on credit cards, overdrafts and personal loans - slowed slightly to 7.0 per cent in October, from 7.1 per cent in September.
The annual growth rate of credit card borrowing slowed from 12.1 per cent in September to 11.5 per cent in October, while the annual growth rate of other forms of consumer credit remained at 5.1 per cent from September to October.
The effective rate on new personal loans to individuals increased to 7.23 per cent in October, marking the highest level since December 2018, when it was 7.45 per cent.
And the effective rate on interest-bearing credit cards rose to 19.31 per cent in October, from 18.96 per cent in September.
But the effective interest rate on interest-charging overdrafts decreased slightly, to 20.73 per cent.
Meanwhile, non-financial businesses repaid £7.3 billion of bank loans in October, marking the highest net repayment since June 2020, according to the Bank of England.
Karim Haji, UK head of financial services at KPMG, said: "There is ample evidence of a slowing economy, from the various GDP forecasts to this data showing that cautious consumers are saving more to build up a buffer ahead of anticipated tougher times.
"People are also redirecting more of their disposable income to work costs, like transport, and essentials, like food, and they appear to be being cautious when it comes to discretionary and big-ticket spend."