Official figures show that the number of new mortgages approved remained strong in July, despite forecasts that recent interest rate hikes would hit borrowing.

The Bank of England said that 288,000 new home loans were approved during the course of the month, which is only 1,000 below the figure for June.

The value of the new loans was slightly lower at £31.4bn, compared with £31.8bn in the previous month.

But within the total, the number of new mortgages for house purchases remained static at 115,000, despite growing evidence that the property market is slowing down.

The report shows there was a slight dip in the number of people remortgaging, dropping to 101,000, from 103,000 in June, while the total value of these loans was £12.5bn, down from £12.8bn the previous month.

Gavin Redknap, an economist at Standard Chartered Bank, said: "The number of mortgages approved was unchanged at 115,000 in July, a better result than was expected.

"The result was made more impressive by the fact that the Bank of England hiked interest rates that month. Typically, a substantial fall is seen in the month that the Bank hikes rates.

"The overall level of approvals has come off its highs of late last year, but there's certainly no sign as yet that the market is falling off the edge of a cliff."

He said that despite higher interest rates, the fundamentals of the housing market remain sound, and any lingering expectations of a crash are being steadily dispelled.

The figures come as Nationwide Building Society said the average price of a home in the UK rose by 0.6% during August, well up on the previous month's gain of 0.1%.

But the annual rate of house price inflation continued to slow during the month, dropping slightly to 9.6%, down from 9.9% for the year to the end of July.

Data from the Bank of England shows that mortgage lending eased slightly during July, with a total of £31.26bn advanced during the month, compared with £31.95bn in June.

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