House sales are plummeting, as rising mortgage rates give buyers cold feet, according to the Royal Institution of Chartered Surveyors (RICS).

House sales usually fall over the summer and bounce back in September, but that hasn't happened this year. The latest estimates suggest that property transactions are now at their lowest levels since May 2020, as reported by This is Money.

Last month's mini-Budget caused chaos for lenders, which has already had a knock-on effect for homebuyers.

Following the controversial move by the Government, mortgage rates reached a 10-year high, with the average two and five-year fixed-rate deals going over six per cent for the first time since 2008.

In the space of just a week, mortgage lenders pulled almost 2,000 products, before repricing them at higher levels.

The report by the RICS said the house market is losing momentum, with economic uncertainty deterring both home movers and first-time buyers.

When applying for a mortgage, borrowers often accept an 'agreement in principle' months before they complete on their house purchase.

But these are time-restricted and do not guarantee a secured mortgage rate, meaning they may expire before a purchase is completed. In recent weeks, some buyers have found their rates are now almost double what they were originally offered.

More than two million households with fixed-term mortgages will remortgage between now and the end of 2024, according to the Bank of England.

They will face rates much higher than they are used to paying, at a time when budgets are already being hit hard by rising energy bills and food costs.

And more buyers could be completely frozen out of the market, as lenders tighten up their affordability checks.

TSB was the first major bank to announce it was increasing its stress tests last month. It will now ask borrowers to prove they can afford interest rates of eight per cent (or seven per cent for first-time buyers).