Mortgage borrowing by individuals in the UK fell in September, with net borrowing dropping to £3.9bn from £4.2bn in August, according to the latest figures from the Bank of England.

The September figure was below the previous six-month average of £4.9bn, while the annual growth rate of net mortgage lending eased to 3.4%, down from 3.6% in August.

Gross lending secured against property edged up to £24.2bn in September, compared with £23.7bn the previous month. However, lending remained below the six-month average of £26.3bn.

Mortgage repayments also increased, rising to £21.4bn from £20.2bn in August. This was slightly above the six-month average of £21.3bn.

The difference between gross lending minus repayments and the reported net lending figures reflects the different seasonal adjustment methods used for the respective series.

Mortgage approvals for house purchases, which provide an indication of future borrowing activity, fell to 53,400 in September from 54,800 in August.

In contrast, approvals for remortgaging with a different lender increased to 42,600, up from 34,000 the previous month.

The figures indicate a mixed picture for the mortgage market, with fewer approvals for house purchases but an increase in borrowers seeking to remortgage with another lender.

The effective interest rate on newly drawn mortgages, which measures the actual interest paid by borrowers, rose to 4.63% in September from 4.60% in August.

The interest rate on the outstanding stock of mortgages also increased, reaching 4.03% compared with 4% in the previous month.

OnTheMarket president Jason Tebb said: “Approvals for house purchases, a useful measure of market activity and sentiment as they indicate future borrowing, dipped once again in September, following falls in July and August. They remain below the previous six-month average as ongoing political and economic uncertainty impacts buyer and seller decision-making.

With the effective interest rate on newly-drawn mortgages also increasing again, to 4.63% in September from 4.6% in August, the impact of higher borrowing costs continues to make itself felt.

“The Bank of England’s decision to hold base rate steady so far this year has helped calm concerns but there are growing expectations that a rate rise is imminent, and may even come next week at November’s meeting.”