Mortgage lending by mutuals continues to rise in April

Mortgage lending by mutuals continues to rise in April

The number of mortgages approved by building societies and other mutual lenders has increased by 30% this April. This April saw a total of 30,651 approvals, a significant increase compared to the 23,617 approvals in the same month last year.

The value of gross mortgage lending by building societies and other mutual lenders increased by 55% this April when compared to April last year. Mutuals have also increased their market share of gross lending to 26%, up from 21% in April 2012, as well as increasing their lending by 28% in the same period. 

Between April 2012 and April 2013 there was an increase from £0.2 billion to £0.9billion in net new mortgage lending by mutuals. Mortgage balances for the first four months of the year at mutual have also risen, increasing their value by £2.8 billion while balances at other lenders have reduced by £.1 billion. 

Adrian Coles, Director-General of the Building Societies Association, said:

“Gross lending by building societies and other mutuals was up markedly in April – by 55 per cent compared to the same month last year and by 28 per cent in the first four months of the year. One reason for the substantial rise this month particularly is that 31 March 2012 marked the end of the stamp duty holiday for first time buyers.  This generated a lull in activity in April 2012.  Following last year’s trend, mutual lenders are still delivering the majority of additional lending into the market as other providers have continued to de-leverage their balance sheets.

Despite the downward pressure on savings rates from the Funding for Lending scheme, building societies and other mutuals experienced strong inflows into savings accounts in April, building on a strong March performance.  This, coupled with some recent retail sales data seems to indicate that many consumers are currently choosing saving over spending. Given the mixed bag of factors affecting the savings market, including interest rates, consumer prices and wages it is unclear if the strong savings inflows will continue for the duration of the year.”

General News

Leave a Reply

Your email address will not be published. Required fields are marked *