Building society Nationwide has reported a slowdown in the number of buy-to-let mortgages approaches, as it posted first quarter results today.
Pre-tax profits for the three months to June were £322m, declining from £401m last year.
But excluding the group's one-off gains from sales of investments, profits were roughly flat. During this quarter Nationwide made an additional £26m from the sale of an investment in payment systems firm VocaLink, while last year £100m was gained through selling an investment in Visa Europe.
Gross residential lending was down to £8.1bn from £8.6bn, while the net figure came in at £2.4bn. This went hand in hand with a loss of net market share in residential mortgages, down from 52 per cent last year to 21.8 per cent.
The number of new current accounts being opened grew 17 per cent to 202,000 in the quarter, compared to 173,000 last year. Market share for current accounts rose slightly to 7.7 per cent.
Why it's interesting
The average UK house price has been sinking, though this is mainly due to decline in London and the south east.
As a result, Nationwide has adjusted its underwriting criteria for buy-to-let mortgages. This combined with a rise in stamp duty has hit the number of buy-to-let mortgage approaches.
This meant the £2.4bn of net residential lending was entirely prime lending, with no growth of buy-to-let lending.
Despite the drop-off in mortgages, the overall amount of loans to customers was up by £2.1bn to £189.5bn.
What the company said
Chief executive Joe Garner said that Nationwide's research had found that most consumers were unconcerned about the effect whch Brexit will have on their ability to access credit, leaving the group relatively confident for the future.
"It will be important for lenders to balance carefully credit supply with affordability as we seek to support the long-term interests of consumers in a responsible way through any potential economic slowdown ahead," he said.
"In a period of potentially prolonged economic uncertainty and persistently low interest rates Nationwide continues to invest in products and services to support the long-term needs of our members."