Martin's Mailbox: Back to life, back to reality…

Martin's Mailbox: Back to life, back to reality…



As a certain Jazzie B of Soul ll Soul said as the summer of 1989 drew to a close - and now, as the golden glow fades and the dog days of August make way for the burnished months of autumn - the bridging sector shows no sign of preparing for hibernation. The agenda, in fact, has rarely looked fuller.

Regulation remains a bête noir. Only last week the FSA made its presence felt with a call to action for regulated lenders to review their approach to retained interest. I’m not going to get drawn into the pros and cons here, but I’m pleased to see the astl wading in early and decisively. With a new and impressive executive committee in place, I expect to see more of the same.

Elsewhere, the CML produced a report confirming the continuing robustness of the UK’s buy-to-let sector. Underpinned by relatively strong funding, wide product choice and favourable demographic factors, the outlook looks good; a fact endorsed by Moody’s, one of the troikas of now-notoriously fickle international ratings agencies. And as we know, what’s good news for buy-to-let is good news for bridging.

It was also good to see positive news from a number of major short-term lenders regarding continuing business growth. Coupled with anecdotal evidence of strong sector performance, we appear still to be in expansionary mode.

Encouraging as this is, I would nevertheless like to see some of our peers reporting harder lending facts. Talking about ‘percentage increases’ and ‘decisions in principle’ are all very well, but they don’t help us understand what’s really going on. Step forward again the astl.

There’s also good cause to be positive on a macro level, particularly with regard to bank lending.

While plainly dreadful for the economy, businesses and individuals, the banks’ continuing inability or unwillingness to lend (take your pick) provides huge opportunity for more flexible short-term providers. Still smarting from self-inflicted errors and scandals, the mainstream remains locked in ‘repair and consolidation’ mode.

The authorities – HM Treasury and the Bank of England – are rightly concerned but have so far failed to provide a solution. Their response has been at best piecemeal and at worst lethargic. Various schemes – Project Merlin, New Buy, credit easing et al – have been launched to great acclaim only to splutter out. Funding for Lending is the next great hope, but don’t hold your breath.

All this adds up to a continuing paucity of easy-to-access affordable credit. Bridging may be small but, in its ability to get liquidity where it’s needed quickly and efficiently, it remains a serious champion for Britain’s beleaguered business and consumer sectors.

As a footnote, you may be pleased to hear you’ll be spared my musings for the next couple of weeks as I disappear on holiday. I promised my wife Catherine and children the BlackBerry will be switched on only for those all-important deal enquiries from our ever-energetic brokers. Given I don’t get to see as much of them as I’d like (Cath and the kids that is) I think it’s only fair.

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