Broker attitudes towards bridging finance shifts
According to the results of our latest Broker Sentiment Survey, a staggering 93% of brokers considered bridging finance a useful financing tool during the third quarter, compared to 77% during the second quarter of 2015.
76% of the 203 respondents also revealed they had experienced a rise in bridging loan volume over the last quarter, reflecting the results from Q3 Bridging Trends, where contributor lending increased by £32.6 million in Q3- up from £99.11 million in the second quarter.
Demand is now higher outside of London than within the capital, as 59% of brokers revealed they witnessed the biggest increase in demand for bridging loans in the South West of England, compared to only 30% in Q1. While London and the North West saw the greatest falls on the Q1 figures, falling from 48% and 18% respectively.
The results shed a positive light on the bridging finance industry, which has grown dramatically since the financial crisis to become a credible and necessary financial product. The days when bridging finance was seen as a last resort and reserved only for desperate borrowers is a distant memory. Professional standards have improved significantly over the years and the market has matured to an extent where lenders are now operating in their own niche sectors and focusing on their strengths. This is good news for borrowers who are now dealing with experienced, established and transparent lenders.
Bridging finance now sits comfortably alongside the mainstream as many brokers and borrowers now see it as a legitimate alternative to high street finance.
The main reasons for the increase in bridging loans are simple, Bridging loans have provided a real time solution to the funding gap that has developed as high street lenders come to terms with increased regulation and the Mortgage Market Review. With the removal of political uncertainty after the General Election, solid house prices and more confidence in the wider macro-economy, we can continue to expect to see a substantial rise in the demand for bridging finance throughout the rest of the year.