Nationwide Building Society has reported a dip in mortgage lending between April and December 2017, blaming a slower buy-to-let market and tough competition over rates.
The building society has just published its results for the first three quarters of its 2017/18 financial year, which revealed that gross mortgage lending slipped to £24.1bn in April-December 2017, compared to £26.2bn over the same nine-month period in 2016.
It means that Nationwide’s market share of the mortgage sector shrunk from 14.3 per cent to 12.2 per cent over this timeframe.
Over the same comparison period Nationwide’s profits fell by around 9 per cent from £946m to £866m, although the drop was largely down to a large one off gain from the sale of a £100m stake in Visa Europe in 2016.
After adjusting for this and other one-off events, Nationwide says its underlying profit was up slightly from £866m to £883m.
Nationwide chief executive Joe Garner says: “As we anticipated, a subdued buy to let mortgage market, plus sustained competition, slowed the pace of growth in our mortgage book.
“With third quarter mortgage reservations significantly stronger than for the same period last year, we expect a strong final quarter for our gross lending.”Looking ahead, Garner predicts the sluggish housing market conditions will continue.
He adds: “Overall, we expect house prices to be broadly flat in 2018 with perhaps a marginal gain of around 1 per cent.
“We expect competition in the mortgage market to continue and we will prioritise quality over volumes in the long-term interests of our members.”
I suspect the reality of this dip is the decision to not offer free legals on remortgages. A decision which has, funnily enough, just been reversed…