New Bank of England figures have shown that the total personal debt fell for the first time since records began in 1993.

The total amount of consumer debt fell in July with personal borrowing falling by £600 million and consumers repaid £418 million more on their home loans, which is more than what was borrowed during July.

The banks figures showed a drop in mortgage debt and also other types of debt such as bank loans. Lending on credit cards also dropped to £92 million, which is the lowest net amount since December 2008.

In addition to this the number of mortgage approvals rose again in July which suggests that property sales are on the increase and points to renewed confidence in the property market. The number of mortgage approvals rose by 2232 between June and July, which despite being below the forecasted amount in still the highest number since April last year.

Adrian Coles, of the Building Societies Association (BSA) believes that there is improvement in the housing market but that massive growth is not expected in 2009.

"The mortgage market continues to show signs of some sort of recovery when compared to the first few months of this year”

The BSA expects the mortgage market to remain similarly subdued over the remainder of 2009"

Economists however, warn against seeing these developments as a full recovery in the property market due to continuing unemployment as well as lending restrictions still being in place.

Simon Rubinsohn, Chief Economist of the Royal Institution of Chartered Surveyors said: “The further rise in the number of mortgage approvals during July is testament to the continuing recovery in the housing market. However, the sharp fall in net lending during the month demonstrates that lenders still remain a little hesitant to increase the total pot of money committed to the mortgage market.”

Economists at IHS Global Insight also agree advising that rising house prices in the current economic climate, with rising unemployment and low wages, would be “negative” for the housing market.