shutterstock_56469016-210x95The Royal Bank of Scotland (RBS) will be increasing restrictions on new mortgages in an attempt to ensure that borrowers can afford their loans.

RBS will restrict customers on loans of £500,000 or more, to borrowing four times their income

The new policy will apply to all RBS and NatWest mortgages from later this month.

RBS wants to address inflationary pressure in London, where prices rose at the staggering rate of 17%, fuelling fears of a new housing bubble.

It follows the same move by Lloyds Banking Group last month and there’s speculation that banks such as Nationwide could soon implement similar rules.

A spokesperson for RBS and NatWest said: “We are focused on looking after the interests of our customers and ensuring that they only take on mortgage lending that they can afford.”

This new trend in the restrictions of mortgages signifies that the housing market has peaked. This has been seen before, on the eve of the last crash, banks finally wise up to the mess they’ve created and begin tapering their lending before the proverbial hits the fan. The banks have finally woken up. Have you?