Recent interest rate rises have yet to lead to any significant cooling of the housing market but the trend for consumers to be more "prudent" about borrowing on credit cards is continuing, a lending body said on Tuesday.

In its latest publication of data covering 70 per cent of gross lending in the UK, the British Bankers' Association said there were 37,804 approvals for mortgages in January.

This was sharply lower than the 45,533 recorded in December and less than half the 78,726 seen in November.

However, the BBA noted that 7,000 approvals had been removed from the total in January after a one-off bout of "spring-cleaning" by banks.

David Dooks, BBA director of statistics, explained that these were long-standing agreements by lenders with potential customers that were not going to be completed?and?were?thus?removed from the banks' books.

After taking this anomaly into account, the number of approvals in January was only 1 per cent less than was seen in the same month a year earlier.

"January saw a continued stable demand for mortgages. Actual borrowing on mortgages remains strong compared with this time last year, so the impact of higher interest rates has yet to feature," said Mr Dooks.

The report also contained confirmation that households are still being wary about borrowing on plastic.

After seasonal adjustments, net borrowing on credit cards fell by £496m last month, after declining by £329m in December. "Prudent repayments, particularly?on credit card accounts, are keeping the unsecured credit picture very subdued," said Mr Dooks.

Howard Archer at Global Insight said: "There are further hints in the BBA data that housing market activity is gradually coming off the boil as higher interest rates and elevated house prices increasingly impact."

A further snapshot of the housing market will come on Tuesday when Nationwide releases its latest survey.

source: Financial Times