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Building society approvals up 20% in Q2: BSA

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Building society approvals rose 20 per cent in the second quarter, according to new figures from the Building Societies Association.

The trade association found that its members approved 118,600 mortgages in the second quarter, up from 98,300 in the same period of 2015.

The Q2 2016 figures are also up 8 per cent from the 109,800 mortgages approved in the first quarter.

Gross lending by building societies in Q2 was £15.9bn, 16 per cent higher than the £13.7bn lent for the same period in 2015, but down on the high of £17.7bn in Q1 2016.

Building societies were responsible for 82 per cent of the growth of the mortgage market contributing £5.5bn of the total £6.7bn of net lending for Q2.

A BSA statement says: “The figures show that societies maintained their strong mortgage market share, following the surge in transactions in the previous quarter to beat the change in stamp duty at the start of April.

“During the second quarter activity may also have been affected by the EU referendum at the end of June.”

The trade body also found that 393,400 new loans were approved across the whole market in Q2, giving its members a 30 per cent market share.

BSA chief economist Andrew Gall says: “It remains too early to tell how confidence in the housing market will be affected by the decision to leave the EU, but it remains business as usual for building societies.

“Mortgage rates are already falling following the actions taken by the Bank of England earlier this month. Even before this, building societies offered excellent value to borrowers with an average mortgage rate of 2.75 per cent in July compared to the market average of 2.93 per cent.

“Overall, these figures paint a positive and encouraging picture.”

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