The Bank of England has eased a curb on risky mortgages that are large relative to a borrower’s income, amid signs that Britain’s housing market has begun to cool.

The UK housing market should "feel more stable and positive" in 2013, lenders said today, as they published figures showing that the number of first-time buyer mortgages advanced in October was a fifth higher than a year ago.

Mortgage approvals in the UK plunged by nearly a fifth in September, a survey said today, amid warnings that a multibillion-pound lending scheme will take time to have an impact.