Lenders withdrew a record number of mortgage products on Wednesday in response to volatile financial markets.
In 24 hours, banks and building societies pulled 935 mortgages — around a quarter of the total — over fears the Bank of England will further increase interest rates.
Rising interest rates make borrowing more expensive and create uncertainty among lenders.
There were 2,661 mortgage deals available on Wednesday, down from 3,596 on Tuesday and 3,880 on Monday, according to data collected by financial information company Moneyfacts.
Before last week’s mini-budget, in which Chancellor Kwasi Kwarteng announced a £45bn package of tax cuts funded by government borrowing, there were 3,961 mortgage products on the market.
Rachel Springall from Moneyfacts urged mortgage borrowers to “keep calm” over the current volatility in the market and to seek advice from an independent broker.
“Various lenders have been very vocal that their decision to withdraw products is a temporary measure, amid the uncertainty over interest rates,” she added.
Mortgage brokers have reported a high number of calls from buyers hoping to lock in deals as soon as possible, according to BBC News.
Ray Boulger, at mortgage adviser John Charcol, told the BBC that rising rates would have a big impact on the ability of people to buy, and would deter some people from buying at all.
With mortgage affordability being a key factor in house prices, analysts believe that house prices could fall by up to 15% over the next 18 months.
