As a bridging finance provider, we are often asked about lending in different regions of the country and whether our focus extends beyond the traditional stronghold of London and the South East.

While the perception persists that lenders just concentrate their efforts in these areas, the reality for many, including Inspired Lending, is quite different.

Moving beyond London-centric lending

Historically, the property market has been heavily London-centric and consequently this has shaped the strategies of many lenders.

London and the South East were considered safe bets, with higher property values and comprehensive market data offering comfort to funders and credit committees.

A large number of lenders are also based in and around London, with lending “closer to home” feeling safer.

For some lenders, this historical preference has been difficult to shift.

However, we and others believe that geography alone should never dictate a deal's viability, but that lending decisions should instead hinge on the quality of the proposition.

While certain areas like Wales or the North East may have lower property values, which can deter certain lenders, lower values can still yield excellent opportunities.

The key is in understanding the strength of the transaction, the borrower, and the exit strategy.

This perspective ensures that deals in regions like Yorkshire, Devon, or the West Midlands are given fair consideration.

The role of data and expertise

A significant factor influencing regional lending is the availability of market data.

London benefits from an abundance of reliable property information, making it easier for lenders to make informed decisions. In contrast, some less-populated, rural areas may lack comprehensive datasets, adding complexity to the decision-making process.

However, this challenge is not insurmountable.

For example, at Inspired Lending we utilise a network of experienced valuers with local knowledge to bridge the information gap.

Valuers play a critical role in assessing properties, particularly in rural or less centralised areas.

For urban properties, valuers are typically sourced within a five-mile radius, ensuring familiarity with local market trends.

In rural areas, where distances are greater, valuers may be sourced from up to 20 miles away but are always chosen for their specific knowledge of the region.

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Debunking the myth of regional risk

A common misconception among brokers is that lenders’ credit committees based in London may not fully understand or appreciate the nuances of deals from outside the capital.

For us, location is just one of many factors in assessing risk. Other considerations, such as the borrower’s experience, the asset’s condition, and the strength of the exit strategy, carry equal if not greater weight in the decision-making process.

In fact, some deals outside London can present lower risks than those within the capital.

For example, the high-value nature of prime central London properties might attract more significant risks due to market volatility, while a well-structured portfolio in the South West could offer more stable returns.

We find that our experience with diverse transactions across the UK reinforces this balanced perspective.

Flexibility as a competitive advantage

Inspired Lending was designed from the outset to have flexibility at the core of its approach to funding; indeed, it is also central to our regional lending success.

We evaluate each deal holistically, by considering how potential negatives, such as lower property values or less-established markets, can be mitigated by other strengths in the deal, such as the borrower’s financial standing or a robust exit plan.

For instance, in areas like the Isle of Wight, where the market is heavily influenced by holiday-let properties, many lenders hesitate due to what they perceive as risks.

However, we have successfully funded projects in such locations by focusing on the deal's overall merits rather than allowing geographic stereotypes to dictate decisions.

Supporting brokers nationwide

A bridging lender who has nationwide coverage will be particularly appreciated by brokers operating outside London and the South East; we speak from experience.

Having an inclusive approach benefits brokers and further strengthens a lender’s market knowledge.

By dealing with a wide variety of transactions — from multi-unit developments in the North East to smaller hotel conversions in the South West — we’ve gained a more comprehensive understanding of the UK property market.

Expanding regional lending horizons

Regional lending in the UK offers plenty of potential for those bridging lenders willing to look beyond traditional boundaries.

Lenders should be committed to casting their nets wide, ensuring no viable deal is overlooked based on geography alone.

By focusing on the quality of the transaction rather than its postcode, lenders will deliver much-appreciated value to brokers and borrowers nationwide.