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?
Copy article
3 responses from the Newspage communityCopy all
Copy all
Copy
The unsecured loan market cannibalised itself with the government-backed loans during the pandemic. Now many businesses are using the secured loan market to obtain funding. Bridging finance allows business owners to use property that is within or outside a company to raise funding. With flexible terms and transparent rates it is a popular source of finance.
Copy
Over recent years the Manchester Mortgage Centre has always welcomed and encouraged investors to use bridging finance where needed.
In 2023 we’ve seen very few enquiries for bridging finance despite it still being very competitively priced.
For anybody looking to secure bridging finance the focus has always been the repayment vehicle. The most common being refinance onto a traditional first charge buy to let mortgage or sale of the investment.
As a result of BTL rates increasing we are seeing more and more deals not fit after assessment. This is leaving investors cautious and insecure about how the market will look when they come to secure their exit strategy.
I predict that in 2024 and 2025 we will see a huge increase in investors looking to secure those deals following the deflation of the UK property market. Watch this space.
In 2023 we’ve seen very few enquiries for bridging finance despite it still being very competitively priced.
For anybody looking to secure bridging finance the focus has always been the repayment vehicle. The most common being refinance onto a traditional first charge buy to let mortgage or sale of the investment.
As a result of BTL rates increasing we are seeing more and more deals not fit after assessment. This is leaving investors cautious and insecure about how the market will look when they come to secure their exit strategy.
I predict that in 2024 and 2025 we will see a huge increase in investors looking to secure those deals following the deflation of the UK property market. Watch this space.
Copy
As a Bespoke Lending Arm, we're noticing a significant increase in both first-time and seasoned investors exploring more creative financing solutions to counter the increases in the base rate. One example of this trend is the growing interest in off-market property acquisitions at discounted prices paired with the utilisation of OMV Lending instead of lending based solely on the purchase price.
The Bridging market remains buoyant as investors seek lending options that allow them to enhance property value prior to selling or securing long-term financing. We anticipate this to continue, with a reduced focus on homeowner purchases. Investors are capitalising on this as an opportunity to negotiate more favourable purchase prices.
Main challenges include down valuations, as valuers understandably air on the side of caution, resulting in higher post-valuation cancellation rates and buyers requiring larger deposits to bridge the gap between purchase prices and market values.
The Bridging market remains buoyant as investors seek lending options that allow them to enhance property value prior to selling or securing long-term financing. We anticipate this to continue, with a reduced focus on homeowner purchases. Investors are capitalising on this as an opportunity to negotiate more favourable purchase prices.
Main challenges include down valuations, as valuers understandably air on the side of caution, resulting in higher post-valuation cancellation rates and buyers requiring larger deposits to bridge the gap between purchase prices and market values.