Mortgage lending by mutuals on the up

Meanwhile latest Bank of England figures show remortgage approvals continue to grow

Gross mortgage lending by building societies and other mutual
lenders was £3.2 billion in April, up by 55 per cent compared to
£2.1 billion in the same period in 2012.

Building societies and other mutual lenders approved a total of 30,651 mortgages in April, up 30 per cent compared to the 23,617 in the same month last year.

Adrian Coles, Director-General of the Building Societies Association, said: "One reason for the substantial rise this month particularly is that 31 March 2012 marked the end of the stamp duty holiday for first time buyers. This generated a lull in activity in April 2012.  Following last year's trend, mutual lenders are still delivering the majority of additional lending into the market as other providers have continued to de-leverage their balance sheets."

Commenting on the mortgage approval figures for April 2013 released by the Bank of England, Peter Williams, Executive Director of the Intermediary Mortgage Lenders Association (IMLA), said: "The most striking aspect is that remortgaging deals, rather than house purchases, continue to make the early running in 2013. So far this year the number and value of remortgage approvals has grown every month without fail, from £25.8bn in January to £30.3bn in April, whereas purchase activity is still below the marker set in January when it was £54.5bn."

Richard Sexton, director of e.surv chartered surveyors added: “ The mortgage market is much stronger than it was six months ago. Lender confidence is more durable compared to the brittleness of the last few years, and that is helping more first-time buyers get a mortgage. House purchase lending is at its highest and most consistent since the financial crisis, and there were 14 per cent more house purchase loans to high LTV borrowers compared to April last year. Rates are low, criteria have eased slightly, and there is a wider choice of high LTV mortgages.

“But the improvements are being stymied slightly by the unholy trinity of weak wage growth, rising costs of living, and meagre savings rates. And on the supply side, lenders will find it difficult to significantly increase the amounts they lend. It will still require a significant tour de force in the economy if the mortgage market is to fully regain its va-va-voom."

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