Building societies have shown resilience by growing their mortgage balances between October 2023 and March 2024, while other lenders saw declines, according to the Building Societies Association (BSA).

During this period, building societies also increased their savings balances and outperformed banks in service levels.

Snippet: Building societies have increased mortgage balances by £8.6bn in six months to March 2024, while other lenders saw a £10bn reduction.

Building societies’ cautious approach to lending is evident in their low arrears rates. As of Q4 2023, only 0.25% of their balances were in arrears compared to 0.69% across the total market.

Their primary goal remains to help people into homeownership and provide a secure place for savings. In the six months to March 2024, building societies helped 49,844 first-time buyers, accounting for 37% of their residential lending.

The savings market also saw growth, with building societies attracting £14.7bn in cash savings, representing 35% of all savings.

Despite cost of living challenges, building societies continued to offer competitive rates. Recent analysis shows building society savers received £2.1bn more in interest than they would have at big banks in 2023.

Customer service remains a strong point for building societies. A YouGov survey indicated that 92% of their customers believe they provide good service, compared to 87% for banks.

Additionally, 75% of building society customers feel their provider is an important part of the community, versus 49% of bank customers.

Building societies have proven their commitment to supporting homeowners, first-time buyers, and savers, reinforcing their vital role in the financial sector.

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