AOBP launches Bridging Market Trend Report

The Association of Bridging Professionals (AOBP) has launched its newest report to dispel lending myths in the industry and detail finance options to intermediaries.

Using a sample set of specialist loan distributors, the Association has worked out a healthy average of what finance options are available out there. Based on quoted enquiries and decisions in principle obtained by these firms, average LTVs, interest rates and loan amounts have been calculated - across a selection of loan/property types, in order to help dispel the lending myths which surround us.

Brokers are able to analyse, on a monthly basis, where the trends lie in the areas of residential, commercial and development finance, as well second charges. This, in turn, will assist them in best placing deals with a new-found awareness of specialist lenders’ undoubtedly varying appetites.

This month’s report is below, covering June 2013:
                    Average LTV       Average rate (pm)   Average loan size
Residential       51.67%                 1.06%                   £675,286
Commercial      58.86%                 1.24%                   £332,233
Development     60.14%                 1.35%               £6,097,928.00
2nd Charge       62.70%                 1.29%                   £167,354

Commenting on the second charge results, Joshua Elash, Director at MTF, said: “The latest AOBP Bridging Market Trend Report for June on second charges is broadly in line with what we see in our portfolio. Second charge loans represent a steady part of our overall lending activity, and it is good to see that our fellow members of the AOBP are also continuing to provide vital funding in this way to the otherwise underfunded SME sector. The data points to healthy LTV levels and competitive pricing for subordinated debt. The outlook is positive.”

Mark Posniak, Head of Sales and Marketing, Dragonfly Property Finance, commented on the residential figures: "We can't talk for anyone else but we have never been busier than during the first half of 2013. June especially was frantic and in the second quarter - reflecting this - we completed on a record number of loans.

"The residential property market is stronger than it has been for a long time and this is contributing to the growth of bridging finance. There is no sign that the demand for residential property from professional investors is letting up.”

The AOBP ran a monthly Market Report for over two years, before making way for the Association of Short Term Lenders (astl) Quarterly Data report - which was launched at the end of 2012.

The previous Report detailed, using a sample set of loan distributors’ figures, which lenders within the sector were lending what. The report was a source and insight into lending levels within bridging and specialist finance and brought out the fiercely competitive spirit within the top tier finance providers. It also revealed just how many deals were being conducted ‘below the radar’ with private funders.

The AOBP Executive Committee deliberated, since February of this year, over what form the latest report should take. What do intermediaries need to know in order to best operate in the market? And where is the current gap in transparency and knowledge?

It was eventually agreed that with so many lenders in the market, all vying for attention and apparently better than the next, a dose of reality is due. Thus, the Bridging Market Trend Report was born.

As of July, the report will be accompanied by a brief analysis and comments from AOBP Lenders and other Associates.