The issue is not on credit (access, LTV, rates, etc). The issue is on the supply side.
More, larger houses means people would afford a better standard of living. They will spend more in the economy. The debt and deficits should go down.
The households are spending unbelievably disproportionate amounts of their incomes on mortgages (or rising rents) and every day more on non-discretionaries, eg energy, petrol, schooling. Another article in the FT says the housing market "picks up" by some 2%. Good news? I would say a sobering proof the disastrous housing policy (or lack of) is alive and kicking.
Put your seatbelts on and assume the bracing position.
BoE warns on mortgage limits