Mortgage balances rise by £11.7bn

Latest data from the Building Societies Association (BSA) has shown that mortgage balances, in the sector, grew by £11.7 billion, accounting for 72% of the mortgage market growth during the period. This follows 2023 where building societies were responsible for all the growth in the mortgage market, as overall mortgage balances at other lenders reduced in the year.

The BSA says that a thriving housing market is dependent on first-time buyers getting onto the property ladder. However, with rising house prices and interest rates considerably higher than they were three years ago, affordability is a significant barrier for many would-be homeowners.

Building societies’ focus on finding innovative solutions to support first-time buyers has enabled them to provide over 63,000 first-time buyer mortgages in the six months to September 2024. This accounted for almost half (44%) of all their residential owner-occupier lending.

Building societies performed better than banks on all measures of customer service. For example, 93% of building society customers agreed their provider offered good customer service, compared to 87% of bank customers. And 86% of customers said their building society offered competitive rates, compared to 73% of bank customers.