Building societies take 82% net lending share in Q2

Building societies were responsible for 82% of the growth of the mortgage market in Q2, contributing £5.5bn of the total £6.7bn of net lending, according to the Building Societies Association.

Related topics:  Mortgages
Rozi Jones
15th August 2016
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"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."

Building societies approved 118,600 new mortgage loans between April and June, up from the 109,800 mortgage loans approved in Q1 and the 98,300 approved in Q2 2015.

Across the whole market 393,400 new mortgages were approved giving building societies a market share of 30%.

Gross lending by building societies in Q2 was £15.9bn, 16% higher than the £13.7bn lent for the same period in 2015, but down on the high of £17.7bn in Q1 2016 as sales were brought forward ahead of the change in stamp duty.

Total market gross lending in Q2 was £57.1bn, with building societies’ market share stable at 28%, the same as in Q1.
    
Savings balances held with building societies increased by £6.8bn in Q2; a 29% share of the £23.5bn increase in cash invested by retail savers across the whole market.

Andrew Gall, BSA Chief Economist at the BSA, said: “Building societies remain popular with consumers, performing strongly in both the mortgage and savings market in the second quarter of the year. They were the main driver of growth in the mortgage market, accounting for 82% of net lending. 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% in July compared to the market average of 2.93%."

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