The governor of the Bank of England warned on Thursday that interest rates may rise later in the year, as George Osborne took action to limit the size of mortgages.

Mark Carney said that rates could rise above 0.5% "sooner than markets currently expect". He said that "gradual and limited" increases would be needed to reduce the risks of an overheated housing market. The City has expected the first increase in official borrowing costs since 2007 to take place early next year.

The average first-time buyer is currently borrowing 3.4 times their household income, with some taking out loans at more than five times their salary, according to the Council of Mortgage Lenders.

There has been a gradual rise in the proportion of a property's cost that people are borrowing to finance a mortgage, but since April banks and building societies have been required to carry out tougher checks.

The new moves by the Treasury to limit the amount of money people can borrow are an attempt to avoid damaging the entire economy with an increase in interest rates. The Bank of England's new powers to limit the size of mortgage loans are the first time the government has imposed direct restraints on the property markets since the 1980s.

The chancellor said that it would be up to the Bank to decide on the precise caps on loan-to-income and loan-to-value ratios should they be needed.

What do you think? Do you have a mortgage and will you be affected by rising interest rates? Are you trying to get your foot on the property ladder? Share your thoughts in the comments below and we will bring a selection above the line.