Figures from the BoE showed that loan approvals for house purchase in May numbered 49,815, largely unchanged from April’s figure of 49,828, but down on the previous six-month average of 51,856.

Remortgaging approvals fell even further in May to 25,759 from 26,279 and the 26,443 six-month average.

The month of May also saw a marginal fall in house prices of 0.2%, the first decrease since April 2009, according to the Land Registry. Annual house price growth held steady on the month before at 8.2%, the first time it has not increased since March 2009.

While Nationwide’s house price index for June showed conflicting growth figures, the overall message of a stagnating market prevailed, with annual house price growth falling for the second consecutive month in June to 8.7%. Property price inflation for June was just 0.1% following the 0.5% rise Nationwide recorded in May.

Martin Gahbauer, chief economist at Nationwide, predicted that annual inflation will continue to drift lower. Indicators pointed to increased supply, he said, after the suspension of Home Information Packs, despite broadly stable demand.

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David Smith, senior partner at property consultancy Carter Jonas, said: “There remains uncertainty surrounding impending public sector cuts, higher taxes and the ever-present threat of rate rises, accentuated by the first vote for a rise on the MPC for nearly two years.

“Although the market as a whole is hardening at or around its current level, sought-after properties in desirable locations may see further price rises, whereas undifferentiated properties in certain areas may see falls.”