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Rise in approved mortgages

Banks have seen a two per cent rise in the number of approved mortgages since the same point last year, according to the British Bankers' Association. Almost 205,000 mortgages were approved in May this year with a gross lending value of £19.7 billion - eight per cent more than in May 2006 in terms of value.Although the Council of Mortgage Lenders (CML) has said mortgage growth has begun to slow, the BBA believes mortgage demand remains high.David Dooks, director of statistics at BBA, said: "Contrary to the recent stable trend, the bands' gross and net mortgage lending strengthened in May, reflecting an improved competitive position."Because of strong approvals in May, the banks' higher market share is likely to continue over the next couple of months."Reacting to the figures, Oliver Gilmartin, senior economist for the Royal Institution of Chartered Surveyors (Rics), said that a further interest rate hike was "guaranteed" in July, possibly effecting mortgage demand."Many indicators point to a slowing housing market in recent months with house price inflation expected to slow sharply into the Christmas period," Mr Gilmartin said.But despite the widely agreed slowdown in the housing market, the BBA's figures suggest banks are still experiencing high demand for remortgaging options and funds to purchase houses.

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