Developers supported by £50m bridging boom

According to the latest West One Loan’s Bridging Index, property developers and builders are enjoying their share of the £50 million of bridging lending that is finalised every week.

The findings indicate that close to £2.5 billion worth of loans were successfully completed over the past 12 months and that loans valued at just shy of £10 million.

The figures show a 24 per cent jump on completed deals from 2013 as the market continues to grow rapidly.

2014’s success follows on from a phenomenal market performance during 2013 which saw lending reach a gross level of £450 million in November.

The progress has led to industry insiders to claim that the figures act as proof of the public’s increasing trust in bridging lending.

Duncan Kreeger, Director of West One Loans said: “Almost £50m a week is a significant chunk of finance and allows a sizeable number of individuals, developers and business owners to complete projects that would otherwise have failed without short-term funding.

“You only have to go back to the summer of 2011 when the daily figure was less than a third (£3.2m) of what it is today to see how much the bridging market has grown and how much more business lenders and brokers are handling on a day-to-day basis. This expansion has been the result of sterling work by key stakeholders to raise the profile of the bridging sector and highlight its usefulness, but has also coincided with high street lenders showing a reluctance to consider short-term or slightly unusual cases which is where bridging loans often ride to the rescue.”

Although interest rates fell slightly from 1.19 per cent to 1.16 per cent by the end of the year and performance as a whole dipped slightly, the market as a whole has enjoyed a significant boom over the past 12 months as these figures no doubt prove.

Market leaders are now hopeful that the industry as a whole continues to grow over the next 12 months.

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