Over a quarter (27%) of people surveyed said it was their biggest concern for 2014.
Consumers are also more worried about the affordability of monthly mortgage repayments today than they were three months ago with 46%of people saying that this was now a barrier to property purchase.
This number was up by 11% on September 2013 reflecting concern about the rising cost of living and an increase in energy bills.
But first-time buyers are feeling more positive about the property market compared to three months ago. Although raising a deposit is still the largest barrier to owning a home the number of people who believe this is the case has fallen by a third, from 66% to 44%.
Paul Broadhead, head of mortgage policy at the BSA, said: “It is understandable that consumers are wary about a rise in interest rates in 2014 but unless the pace of economic recovery picks up considerably it is unlikely we will see the Bank Base Rate rise over the coming 12 months and, when interest rates do rise, it is likely to be gradual.
“There remain plenty of options for a homebuyer to get greater certainty over their mortgage repayments with 69% of the mortgage products available on the market now at fixed rates.When consumers apply for a mortgage, most lenders will also check that it is affordable were interest rates to rise, which should provide some comfort for homebuyers, though it may mean they can borrow less than they anticipated.
“Mortgage rates are also far lower today than they were ten or twenty years ago which is good news as household budgets are still under considerable pressure.
"In the early 1990s, a typical mortgage would have taken up around 27% of a household’s monthly income, whereas today it is nearer 17%.
"Consumers consider their whole household budget when thinking of buying or moving house and we hope the improving economic conditions will start to be felt in consumer wallets in the New Year.
“It is encouraging that first time buyers are feeling more confident about the housing market. Publicity surrounding government schemes will have helped alongside the increase in supply of lower deposit mortgages.
"We would urge consumers to shop around if they do have a smaller deposit as there are excellent deals to be had outside the Help to Buy scheme.”