Average bridging completion

Average bridging completion time rises in Q3

The average completion time on a bridging loan application has increased to 46 days during Q3 2018, compared with 43 days during the previous quarter, according to new figures.

The latest Bridging Trends data found that service and resource levels were impacted by annual leave.

“Completion times increasing again is a worry, speed seems to a forgotten pre-requisite of bridging and more of a USP these days,” said Luke Egan, head of specialist property finance at Pure Commercial Finance.

The research also revealed that for the second consecutive quarter refurbishment was the most popular reason for obtaining a bridging loan.

Mortgage delays were the second most popular reason for obtaining a bridging loan, accounting for 19% of all lending, down from the 20% recorded in Q2 2018.

Bridging loan volume transacted by all the contributors to the Bridging Trends data reached £213.35m in Q3, an increase of £15.4m.

This was supported by specialist finance packager Clever Lending becoming the latest contributor to the report.

The data highlighted that the proportion of regulated bridging loans fell for the second consecutive quarter to 31.6% of all lending in Q3 2018, compared with 36.8% during the previous quarter.

This was the lowest level since Q1 2015, when the proportion of regulated bridging loans transacted was 31.5% of all lending.

Meanwhile, the average monthly interest rate dropped to 0.78%, compared to 0.83% in Q2, while average LTV levels decreased to 55.4%.

“The data continues to show that property investors are seeking attractive opportunities to acquire properties where they can add value, a trend that shows no sign of slowing down,” said Gareth Lewis, commercial director at mtf.

“Conversely the transaction flow in the regulated space has continued to show signs of slowing down.

“Is this a direct response to the everyday purchaser taking stock of Brexit and holding fire before looking to commit to the purchase of a new residence?"

Sonny Gosai, head of specialist lending at Clever Lending, said that it was privileged to be on board with Bridging Trends, which provided much-needed analysis of the market.

“The bridging industry is booming at present and forms a large part of our key distribution and remains one of our main focuses.

"While the data suggests that there has been a drop in regulated bridging activity, we have recently set up a team solely to provide regulated bridging advice as we have seen a growth in this area particularly for enquiries.

“It will certainly be interesting to see what the next quarter’s Bridging Trends results will be.”

You can view the full infographic for Q3 2018 here.

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