Mortgage lending is showing signs of slowing down as consumers respond to higher interest rates, new figures show.

The British Bankers' Association said 193,850 new home loans were approved during June, worth a total of £23.09bn.

It added the number of loans approved is 5% lower than May's figure, when the total value reached £24.17bn, and 8% below the levels seen in June last year.

The fall in approvals is being led by a drop in the number of people buying a new home, with new mortgages for home movers down 11% year-on-year, while 1% fewer people remortgaged compared with 12 months earlier.

But despite the slowdown in the number of new loans approved, the BBA said the total amount advanced by the major banks during June hit a new high of £21.51bn.

The group said the figure reflects strong levels of remortgaging and is only 5% higher than 12 months ago, suggesting that, in real terms, lending growth is slackening.

Net mortgage lending, which strips out redemptions and repayments, was £5.41bn during the month.

This was down from May's figure of £5.87bn, but in line with the recent monthly average and continuing to grow at an annual rate of about 14%.

The average value of a loan approved for a house purchase is now £159,600, 16% higher than in June 2006.

David Dooks, BBA director of statistics, said: "Although the trend in net mortgage lending is being maintained, approval numbers for house purchase are well down on this time last year, suggesting that market demand may be reacting to higher mortgage costs."

Figures from the BBA also show that the amount of credit card debt consumers are taking on has fallen by 4% compared with June last year.

Consumers spent £6.98bn on their plastic during the month, but once repayments are taken into account, they actually paid back £73m more than they borrowed.

It is the fifth month this year and the 10th time in 12 months that repayments have outstripped spending.

New lending through overdrafts and loans was 5% higher than in June last year, although after repayments were taken into account, the figure rose by £117m during the month, compared with a jump of £154m in June 2006.

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