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Mortgage lending from mutuals remains strong

Mortgage lending from mutuals remains strong

Category: Mortgages

Updated: 30/04/2013
First Published: 30/04/2013

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Gross mortgage lending from building societies grew annually by 8% to over £2.9 billion during March, according to latest data from the Building Societies' Association (BSA).

A total of 30,495 mortgages were approved and advanced by mutuals last month, a yearly increase of 12% and 26% more than the 27,260 mortgages lent in February this year.

Mutuals' market share, in terms of gross lending, continued to grow last month, accounting for 25% of the overall sector.

Customers also appear to be turning to building societies when placing money aside for a rainy day.

Despite savings rates being hit hard by the effects of tax and inflation, total savings balances with mutuals grew by £1.2 billion, whilst net tax-free savings held with building societies climbed to £294 million during the peak of the ISA season last month.

Adrian Coles, director-general of the BSA, said: "The low risk nature of building society deposit accounts is appealing to people at this time when alternative investments come with significantly more risk, but not necessarily a greater return.

"Households' ability to save is likely to face continued pressure this year as consumer price inflation is expected to reach 3%, whilst growth in regular pay is at an all-time low."

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