Bridging and development finance activity slowed in Q2 2026, according to the latest quarterly data from the Bridging & Development Lenders Association (BDLA).
BDLA lender members reported lower applications, completions and loan book values in Q2, following a similar pattern seen in Q1.
In the three months to 30 June, completions were £1.6bn, a fall of 15.2% compared with the previous quarter.
Applications were £7.3bn, down 26.3%, while total reported lender loan books fell by 10.6% to £10.3bn at the end of June. The figures follow the reduction in activity reported in the first quarter of the year.
The BDLA said feedback from the market points to subdued property transaction activity and often protracted completion times, putting pressure on new business pipelines and sharpening lenders’ focus on exit strategies.
It emphasised the importance of thorough due diligence and realistic assessments of how borrowers will exit their loans within the agreed term.
Development lending showed a smaller quarterly decline, with loans written totalling £273.5m, compared with £276.5m in Q1. Second charge completions totalled £101.1m, down from £131.3m in the previous quarter.
Average loan-to-value ratios increased to 57.66%, from 56.64% in Q1 and the reported value of loans in default fell by 0.4% quarter-on-quarter.
The BDLA’s quarterly data survey is compiled by independent auditors using figures submitted by participating lender members and provides a snapshot of activity within the UK bridging and development lending sector.
BDLA chief executive Adam Tyler said: “These figures show that the slowdown in lending activity continued into the second quarter of this year, but bridging and development lenders are not alone in experiencing a quieter market. Feedback from across the property sector is that transaction levels are subdued and deals are often protracted. A slower-moving housing market is putting downward pressure on new business pipelines, with fewer enquiries and applications coming through.
“At the same time, these conditions bring the exit strategy on short term loans into sharper focus. Where a loan is expected to be exited through a property sale, lenders need to consider not just the anticipated sale price, but how long that sale could realistically take and what alternatives are available if it does not complete within the agreed term.”
