It totaled £24bn.
Lending by high street banks was down even more significantly, falling 4.2 per cent to a total of £16.1bn.
The month saw 85,931 mortgages overall approved by high street banks. Of these, 43,957 were for house purchases, which were up 3.2 per cent on last year.
There was a slight increase of 0.1 per cent in the number of deals approved for remortgage, at a total of 32,490, while other secured lending dropped by 0.4 per cent to 9,484.
Purchases ‘firing on all cylinders’
Sam Harhat, head of financial services at Andrews Property Group, said the market had “backed off” from the high for approvals registered in July, but cautioned that should not detract from the solid recent performance.
He continued: “Approvals for home purchase are still firing on all cylinders in comparison to the same month last year and this is the number that will be receiving a lot of attention.
“Property watchers from all sides of the industry want to see an indication that cooling price growth, and some outright falls in many highly contested areas of the country, is having some effect and resulting in a recovery in sales volumes.
All down to Brexit
Dilpreet Bhagrath (pictured), mortgage expert at Trussle, suggested that the dip in activity since July was likely the result of Brexit-linked uncertainty hitting both buyers and sellers.
She continued: “However, for first-time buyers with a deposit already saved up – there are a number of highly competitive mortgage deals across the market at the moment.”
The wheel that keeps turning
Richard Pike, sales and marketing director at Phoebus Software, suggested the market was showing some “resilience”, particularly in terms of lending from high street banks which he suggested showed people were “creatures of habit” and preferred to stick to the high street rather than shop around.
He continued: “It appears that despite everything that is being thrown at us, in what has to be said are very uncertain times, the issue of moving or buying a new home is a wheel that really does keep on turning.”