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Building societies double lending

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06/01/2014
Building societies and other mutuals have doubled their net mortgage lending over the last year.

According to data released by the Building Societies Association (BSA), the organisations handed out a net total of £12.1bn to homebuyers in the first 11 months of 2013, compared with £6.2bn in the same period the year before.

This compared with a reduction in net lending by all other lenders of £2.1bn in the same period, the BSA said.

About a third of the loans were given to first-time buyers, the vast majority arranged at fixed rates.

Arrears at mutuals have fallen, the BSA said, currently standing at two thirds of the market average.

BSA chief executive Robin Fieth said:

“Building societies and other mutual lenders have performed strongly in their two core markets, savings and mortgage lending, over the past year.”

He added:

“While mutuals have increased their lending in 2013, underwriting standards have remained high, and levels of arrears have actually reduced over the past year, as they have done across the market.

“The mutual sector has performed better than the market as a whole in this area with levels of arrears at two thirds of the market average.”

Meanwhile Nationwide data showed that house prices across the country rose by 8.4% in 2013. But they were still about 5% below their 2007 peak, the building society said.

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