Strong first quarter for building societies

Posted On: 
23rd May 2019

Released on the day that the BSA's 150th anniversary Conference begins, lending and savings figures for Q1 2019 show that building societies accounted for 57% of the growth in the mortgage market, and took 35% of cash savings deposits in the first quarter of the year.

Building society mortgage lending Q1 2019

Outstanding mortgage balances are £327.1bn, a 23% market share, and up 8% on the £303.0bn at the end of Q1 2018.

Gross lending was £16.7bn, a 27% market share, and up 6% on the £15.8bn in Q1 2018.

Net lending was £4.9bn, a 57% market share, and up 14% on the £4.3bn in Q1 2018.

Societies approved 120,626 new mortgage loans, a 33% market share, and up 6% on the 113,379 loans in Q1 2018.

They lent to almost 25,000 first-time buyers, with this part of the market accounting for 34% of loans to homeowners.

Building society savings balances Q1 2019

Societies hold savings balances of £284.7bn, a 19% market share, and up 5% on the £271.7bn at the end of Q1 2018.

Savings balances increased by £3.8bn, a 35% market share, and up 18% on the £3.2bn increase in Q1 2018.

Cash ISA balances grew by £2.7bn. Banks saw cash ISA balances increase by £1.8bn. Societies have a share of 37% of all cash ISAs deposits.

Commenting Robin Fieth, Chief Executive at the BSA said:

“Building societies continued to grow their market share in both the savings and mortgage markets in the first quarter of the year.

“There hasn’t been much growth in the mortgage market over the last few years, but homebuyers are evidently turning to building societies more often when securing mortgage finance. In the first quarter of the year, societies accounted for over half (57%) of the growth in the market. Building societies understand that people can have complex needs and that sometimes a more personalised approach to mortgage lending is required.

“The environment remained challenging for savers at the start of the year.  With record low interest rates and inflation running higher than pay growth, many household budgets were squeezed. However, wages are now growing faster than inflation, and savings rates are starting to edge up gradually. Households have a little more capacity to save, and in the first quarter of the year savings balances are up 44% across the market. Taking a third (35%) of the new savings in the quarter, demonstrates the appeal of the sector’s offering.”