The Council of Mortgage Lenders (CML) said that mortgage lending was expected see "extremely strong levels" over the next few months.

And separate lending figures from the British Bankers' Association (BBA) also showed that mortgage lending had remained high in September.

The BBA figures also showed consumer credit growing strongly.

Loan warning

The CML's latest figures showed that mortgage lending slowed slightly last month.

In September gross lending hit £19.7bn, which was down slightly on August's figure of £20.7bn , but still much higher than the £13.7bn borrowed in September last year.

Of those loans that were being used to buy a property, as opposed to remortgaging, 40% went to first-time buyers.

The CML warned home buyers not to overstretch themselves.

"Clearly the housing market is still out-performing the rest of the economy and this cannot continue for ever," said the CML's director general Michael Coogan.

"The evidence so far points to the likelihood of a gentle easing next year rather than a dramatic slowdown, but we would still encourage borrowers to exercise caution before committing themselves to increased levels of debt," he added.

Consumer credit rises

The BBA's figures showed net mortgage lending - which shows disbursements less repayments - rose by £5bn last month, slightly higher than August's figure of £4.8bn.

"Mortgage lending in September remained very buoyant, with re-mortgaging and equity release maintaining customer demand as housing activity itself slowed," said the BBA's executive director Simon Pitkeathley.

Consumer credit also hit a record monthly rise, increasing by £1.2bn in September, compared with rise of £1bn for each of the past three months.