The number of mortgages approved by banks fell 10 per cent in September compared with a year ago, figures published by the British Bankers' Association showed.
The fall came after "cooling measures" introduced by the Bank of England, which make prospective borrowers undergo "stress tests" to figure out whether they can afford a loan, came into effect in April.
However, gross mortgage borrowing hit £10.6bn during the month, seven per cent higher than during the same month last year.
More encouragingly credit card borrowing, which economists have pointed out is disproportionately high in the UK, fell - albeit by a relatively small £300m. Similarly, personal deposits rose £2.7bn, suggesting a move away from credit-fuelled spending. Net borrowing by businesses fell £1.8bn during the month.
Richard Woolhouse, the BBA's chief economist, said:
A year ago there were many of us who were concerned by the heady pace of property price rises. “Today’s figures suggest we are now experiencing a steadier housing market and that’s no bad thing.