Britain’s mortgage market is experiencing severe rivalry, which pressured lending and revenue at Nationwide, suggesting that the market’s advance will probably be limited in the near future.
The country’s largest construction society showed fall in net mortgage lending by over 30% in the span of a year to April 4, plunging from £8.8 bln to £5.8 bln. One of the reasons for the slump was a scheduled cut in buy-to-let mortgages in the wake of altered tax rules in 2017, though Nationwide also gave up some of the market share trying to keep margins at the time of growing competition.
Some of Britain’s lenders have pointed to mounting margin pressure in the property market, caused on the one hand by slower growth, and on the other hand by intensified activity in the market by large banks as HSBC, seeking expansion to engage idle funds in its ring-fenced UK branch.
Nationwide is still trading high regardless of hot competition in main markets, at times preferring to secure profit for members instead of opting for margin increase, Mark Rennison of Nationwide said.