Bridging finance demand increases during Q1

The number of brokers witnessing an increase in bridging volume has soared to 59% in Q1 2017 (Q4 2016: 31%), according to the latest broker sentiment survey by MTF.

The bridging lender’s report revealed that the South East had the biggest demand for bridging loans in the UK at 40% (Q4 2016: 29%), followed by London at 30%.

Development funding was the most popular reason for taking out a bridging loan.

This was cited by 30% of brokers and was followed in popularity by the purchase of an investment property (20%).

Almost half (45%) of the 100 brokers surveyed said competition was the biggest issue currently facing the bridging finance sector.

Some 30% highlighted delays as a key issue, while 15% said regulation.

James Anderson, head of new business at MTF, said: “The feedback from brokers points to a strong need for specialist lending, particularly from developers who continue to support the housing market by providing further supply to meet the ever-constant demand.”

When asked: “Where would you like to see more product enhancements in the bridging finance sector?”, 40% said they would like to see higher LTVs.

Another 25% wanted greater flexibility on commercial lending, while 15% indicated that they would like to see greater flexibility on adverse applicants.

Some 40% of brokers said interest rates and pricing was the most important factor when choosing a lender, while 30% said speed of completion was paramount.

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