The UK’s bridging finance market shows remarkable growth in Q3 2024, with enhanced efficiency and increased lending.
- The average completion time for bridging finance decreased, achieving the fastest rate since 2019.
- Gross lending surged to £220.8 million, reflecting a 10% rise in lending volumes.
- Investment purchases dominated the sector, accounting for 24% of all bridging loans.
- Regulated and unregulated refinancing reached unprecedented levels, while chain-break loans declined.
The UK’s bridging finance market has witnessed significant growth throughout the third quarter of 2024, demonstrating improvements in both operational efficiency and lending volumes. The substantial decrease in completion times, which now stands at an average of 46 days down from 52 days in the previous quarter, marks the quickest completion rate observed since 2019. This reduction in completion times signals a notable enhancement in market efficiency.
Accompanying this improvement in process efficiency, gross lending figures have soared to £220.8 million, which underscores a considerable 10% boost compared to the previous quarter. This increase in lending activity aligns with a marked rise in bridging finance used for investment purchases, which have grown to represent 24% of total loans, up from 18% in the second quarter.
A shift in borrowing priorities is evident with a significant spike in both regulated and unregulated refinancing activities. Regulated refinancing has climbed from 6% to 14%, while unregulated refinancing has risen from 6% to 13%. This trend indicates a growing preference for refinancing solutions within the market, driven by varying borrower needs and market conditions.
In contrast, there has been a decline in chain-break loans, pointing to a more stable housing market and less disruption in property transactions. This stability may contribute to the increased confidence among property investors who are keenly seeking new opportunities.
Commentary from industry experts highlights these developments. Chris Oatway of LDN Finance notes a marked improvement in efficiency, while Shane Chawatama from Knowledge Bank observes a persistent popularity in bridging demand, particularly in second charge bridging and adverse credit scenarios. Gareth Lewis from MT Finance emphasises the importance of the decreased completion times and the burgeoning confidence among property investors.
The third quarter of 2024 has marked a pivotal period for the UK’s bridging finance sector, achieving both growth and efficiency.
