Bridging market trends
What are the current trends in the bridging market?
How buoyant is the bridging market at present?
What are your expectations for the bridging market in 2023?
What are the challenges in the market right now?
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3 responses from the Newspage communityCopy all
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Bridging is the bath water thrown out by mainstream lenders that’s poured and formed a lake of milk and honey for those that entered the void. This highly active and lucrative sector is now firmly the domain of specialist lenders as they grow stronger and attract inward investment and mainstream lenders are left behind. With greater transparency and competition, bridging is now a mainstream solution for many to achieve their property-buying ambitions. Many bridging lenders are FCA-regulated and therefore able to deal with regulated cases. The issues are still that of speed, paperwork, fees and default penalties. These need to brought into line as I’ve seen fees in the tens of thousands for default cases, which can be crippling and leave the borrower in a precarious position. It’s ironic the most dangerous loan type isn’t regulated and can be peddled by those who aren’t even qualified advisers. As market conditions tighten, bridging lenders will also tighten their belts.
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Bridging is a fantastic tool for both regulated and non-regulated property transactions. There is now more acceptance and education in these areas, helped by social media and digital information availability.
We see chain breaks and asset-rich cash property residential clients taking advantage to acquire quickly and beat the competition with cash buying habits, with competitive lending rates supported by a more stable Sonia money market. The savvy investors among us have leveraged bridging for a long time, using it to acquire difficult-to-mortgage properties, solve problems and then term finance out often realising the true OMV on bridge exit, making it a fantastic tool to scale and recycle funds. We see a steady flow of enquiries that convert well due to the speed and certainty of the buyers. With more bespoke and flexible lenders in the market, the future is a positive one for the bridging industry and more importantly for the client acquisition opportunities.
We see chain breaks and asset-rich cash property residential clients taking advantage to acquire quickly and beat the competition with cash buying habits, with competitive lending rates supported by a more stable Sonia money market. The savvy investors among us have leveraged bridging for a long time, using it to acquire difficult-to-mortgage properties, solve problems and then term finance out often realising the true OMV on bridge exit, making it a fantastic tool to scale and recycle funds. We see a steady flow of enquiries that convert well due to the speed and certainty of the buyers. With more bespoke and flexible lenders in the market, the future is a positive one for the bridging industry and more importantly for the client acquisition opportunities.
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We have seen an increase in demand for bridging. It is more appealing now than ever as the gap between the standard residential and bridging rates has narrowed significantly. In some cases, there isn't much difference.