Press release

Strong Q4 boosts building society 2018 performance

Lending and savings figures published today show that building societies lent £68.9 billion in mortgage finance in 2018, up 7% on 2017.  Over the same period savings balances increased by £14.3 billion, well ahead of the £8.5 billion increase for the previous year.

Building society mortgage lending 2018

  • Gross lending totalled £68.9 billion, up 7% on 2017  (£64.1bn)
  • Net lending totalled £17.9 billion, up 12% on 2017 (£16.0bn) - 39% of market growth
  • 476,803 new mortgages were approved, up 8% on 2017.  This represents 31% of all mortgages approved last year. 
  • Around 1 in 3 mortgages were to a first time buyer. 
  • 23% of all outstanding mortgage balances are held by building societies - £322.3 billion up from £298.7 billion at the end of 2017.

Building society savings balances 2018

  • Savings balances rose by £14.3 billion, well up on the £8.5 billion increase in 2017  
  • Societies hold savings balances of £281.7 billion,  5% up on balances at the end of 2017 (£268.8bn)
  • Cash ISA balances grew by £9.9 billion. Banks saw cash ISA balances decrease by £3.0 billion. Societies hold 37% of all cash ISA balances.

Commenting Robin Fieth, Chief Executive at the BSA said:

“Building societies performed strongly in the final quarter of 2018, adding to a robust performance for the year as a whole which was delivered despite challenging market conditions. The housing market was and remains subdued, with little growth except in re-mortgages.  Here homeowners have been locking into deals while interest rates stay low, to provide some financial stability in uncertain times.  Mortgage product innovation remains a strength for the sector, together with the more personalised approach to mortgage underwriting.  The strong finish in Q4 bodes well for lending early in 2019, subject to the outcome of Brexit and consumer sentiment in the run-up to 29 March.

“For much of 2018 wage increases were eroded by inflation, making it harder for households to save. Savings growth across the market was relatively flat but building societies grew their share of the increase in balances from 19% in 2017 to 31% in 2018. Towards the end of the year pay growth picked up, inflation fell and UK employment reached a record high. If they continue, these conditions should make it easier for households to save in the coming year.

Contacts

Hilary McVitty, hilary.mcvitty@bsa.org.uk Tel: 020 7520 5926 /07507 837 326
Amy Harland, amy.harland@bsa.org.uk Tel: 020 7520 5927

Notes to editors

Download building society mortgage lending figures here

Download building society savings figures here.

*Building societies remain top for customer service

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