September mortgage approvals at mutuals up 33%

Against the backdrop of continued economic uncertainty, building societies and other mutuals continue to support homebuyers and savers, report the BSA.

Related topics:  Mortgages
Millie Dyson
31st October 2011
Mortgages
Both the value of mortgage approvals and gross lending in September 2011 are at their highest level for any month since the BSA started reporting on the current basis in January 2010. Savings balances in September grew by £0.6 billion, compared to an outflow of the same amount in September last year.

Lending:

- £2.5 billion of mortgages approved by mutual lenders in September, up 22% on August 2011 (£2.1 billion), and up 33% on September 2010 (£1.9 billion).

- 18% rise in mortgage approvals for the first nine months of 2011 at £17.1 billion (£14.5 billion, January - September 2010).

- 4% rise in gross mortgage lending in September, up to £2.3 billion from £2.2 billion in September 2010.

- 14% increase in gross lending for the first nine months of 2011 at £16.7 billion (£14.7 billion, January - September 2010).

Savings:

- Savings balances were up £0.6 billion in September 2011, compared to a decrease of £0.6 billion in September 2010.

- Excluding interest credited to accounts, building societies and other mutual deposit takers had net receipts of £0.3 billion in September 2011, compared to a net withdrawal of £0.8 billion in September 2010.

- In the first nine months of 2011, savings balances held with mutuals have increased by £2.7 billion, compared to a decrease in balances of £0.9 billion in the same period in 2010.

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

"Although the UK economic outlook remains challenging, mutual lenders continue to support homebuyers by providing attractive mortgage products.  This has led to a 33% increase in mortgage approvals in September, compared to the same time last year.

"Mortgage approvals indicate how gross lending will change in coming months. Over the first three quarters of the year gross lending by mutuals was up 14% on the previous year, and the growth in approvals suggests that this trend will continue into the final quarter of 2011."

 "Savings balances held with mutual deposit takers have risen by £1.6 billion over the third quarter of 2011, in stark contrast to the decrease of £2.3 billion for the same period in 2010.

"Part of the reason for this improvement is likely to be the recent stock market volatility causing investors to seek a more stable home for their money."
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