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- Building society gross advances amounted to £4,650m in June 2007, compared to £5,136m in June 2006.
- Net advances were £1,178m in June 2007, versus £1,894m in June 2006.
- Approvals were £4,693m in June 2007 down from £6,046m in June 2006.
- Building societies had net receipts of £576m in June 2007 compared to £657m in June 2006.
- Building society net receipts to cash ISAs were £309m in June 2007, compared to £250m in June 2006.
Commenting on the mortgage market, Brian Morris, Head of Savings Policy at the BSA said:
“The slow start to the summer has continued. Although 2007 started strongly, it seems the impact of successive interest rate rises is now being felt and is affecting affordability. Typically, building societies are maintaining robust lending criteria and this is a possible explanation of the recent slowdown in building society lending.
“Borrowers should be careful about overstretching themselves at this time of rising interest rates and take on new borrowing only if they are sure they can afford to service it.
“With many commentators expecting another rate rise soon, lending may well cool further over the remainder of the year and into 2008.”
Commenting on the savings figures, Mr. Morris said:
“In the second quarter of 2007, net receipts into savings accounts at building societies grew by 10.6% over the same period last year. This is partly because of some relatively low levels of saving in the late spring last year, but may also reflect higher rates of interest on accounts following the rises in the Bank Rate.
“However, the inflow in June was 12.3% lower than a year earlier. This suggests that households are finding their finances increasingly tight and that despite the higher rates of interest available, they are having difficulty saving.
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The Building Societies Association (BSA) represents all 60 building societies in the United Kingdom. Building societies have total assets of almost £315 billion and hold residential mortgages of just under £215 billion, approximately 18% of the total outstanding in the UK. Societies hold over £200 billion of retail deposits, accounting for about 19% of all such deposits in the UK. Building societies also account for over 37% of all cash ISA balances. Building societies employ over 50,000 full and part-time staff and operate through around 2,100 branches.
Photographs of Brian Morris are available from the BSA press office, or from the Association’s website at www.bsa.org.uk or Headlinemoney www.headlinemoney.co.uk
A briefing paper for journalists on what borrowers should do if they have difficulty paying their mortgage can be found at http://www.bsa.org.uk/docs/presspdfs/arrearsjournalist.pdf
