BSA predicts drop in mortgage lending

Date:Monday 1st November 2010
Author: Max Freedman

The Building Societies Association (BSA) has forecast a fall in mortgage lending in the near future, despite recording positive figures for September.

Director general of the organisation Adrian Coles made his comments after it was announced that gross mortgage lending among mutuals increased from £2 billion in August to £2.2 billion in September.

But he suggested the impact of the comprehensive spending review and reports of decreasing house prices are likely to have a negative effect on figures.

Mr Coles added: "Although the mortgage market remains relatively weak, mutual lenders have seen a slight increase in lending over recent months."

The BSA revealed that mortgage approvals also increased during the same period, with the figure rising from £1.8 billion to £1.9 billion.

Last month, the same industry body welcomed the introduction of junior Isas, with Mr Coles stating they could go some way towards filling the gap left by the scrapping of Child Trust Funds.