First-time Buyers

Building societies account for quarter of all lending

Adam Williams
Written By:
Adam Williams

Building societies accounted for more than a quarter of all UK mortgage lending completed during 2015, figures have shown.


The Building Societies Association said £52.6bn of mortgage lending was completed by mutual organisations during the year. This is equivalent to 26% of the total mortgage market last year.

The trade body said this was well above the sector’s ‘natural share’ of around 19%.

In the final quarter £13.8bn of lending was completed, down on the previous quarter but performing better than the wider market.

In total almost 90,000 new loans were approved in the final three months of 2014 by mutuals. Over the whole year societies approved over 373,000 new loans to homebuyers.

Paul Broadhead, head of mortgage policy at the BSA, said mutuals were benefitting from a more pragmatic approach to underwriting.

“This is a particular benefit for consumers who don’t quite fit the borrower profile of the mass-market automated lenders and for people who need something a little different, like self-build or family guarantee style mortgages,” he said.

“Competition will be stiff in 2015, especially now that an increase in the bank base rate this year looks to be out, even to the point of the Bank of England stating that a drop in this rate, whilst unlikely, is a tool that will be used if necessary.

“We saw mortgage demand come off the boil at the end of last year.  Now, uncertainty around the general election and matters further afield like the fate of Greece and the Euro zone may well have a dampening effect, although consumers should take heart from the fact that mortgage availability is good.”