The amount of money lent for mortgages fell in September, according to new figures released by the Council of Mortgage Lenders (CML).
While falls between August and September are a regular occurrence, the 12 per cent fall experienced last month was higher than the usual norm of five per cent.
However, overall lending had increased by 2.5 per cent on the same figure last year.
Commenting on the statistics, CML director general Michael Coogan said: "We have been expecting a slowdown in monthly lending levels in line with interest rate rises.
"In the coming months, we expect to see monthly lending levels dip below their 2006 levels for the first time this year as rate effects are exacerbated by the recent liquidity problems in the mortgage market."
The CML is an association made up of members from many financial services, including banks, building societies and other lending firms.
Established to ensure that the housing and mortgage markets stay in a workable state, the body also provides advice to consumers who are planning on either buying or selling a home.
Click here to run an energy price comparison, and see if you could be paying less for your gas and electricity.