What will 2022 bring? That’s the question on everyone’s lips at the moment. Reflecting on all that happened in 2021, it most certainly wasn’t the year we thought it would be.
Yes, some things seemed to move towards “normal” again, however with the recent rise of COVID cases, as a result of the new Omicron variant, it has proved once again that we don’t know what is waiting around the corner.
The specialist lending market has also experienced a great amount of uncertainty over the past year, however one area which has experienced sustained growth over the last 12 months is the high demand for bridging loans which facilitate investors and developers looking to undertake light to heavy refurbishment works.
The increased demand for this particular product type, will undoubtedly continue into 2022, as the number of investors looking for projects where they can add value and see a quick return continues to grow.
With both homebuyers and renters seeking ‘turn key’ properties that are designed for modern living, there is an opportunity to sell or rent these properties at a premium price.
Refurbishment loans are generally used for two reasons: those who are looking to undertake light refurbishments (e.g. a new kitchen, bathroom and general decoration works) or projects involving heavy refurbishments (e.g. structural works).
With many investors and developers looking for opportunities to make a larger return on their investment, renovating a property can achieve this by adding significant value to a dwelling.
This is especially true at a time where well-maintained properties, designed to fit the work from home trend, are being snapped up, sometimes within hours of coming to the market.
Therefore, looking ahead, I can only see the demand for homes designed for this purpose and in turn finance options available to help achieve this, continue to grow.
This is why we decided to launch the refurbishment range at Hope Capital way back at the beginning of 2021, which is specifically designed for borrowers undertaking property refurbishment projects.
The two products are ideal for those who require a short-term finance solution in order to fund their project and improve their investment property, to fit in with the ever-increasing work from home trend and increase yield.
Refresh is designed for a property which requires relatively minor upgrades and renovate is suitable for more extensive and advanced projects.
A short-term loan enables a customer to access funding extremely quickly and provides the ideal solution for investors and developers looking to obtain funding to undertake improvements works to a property — both on a light and heavy refurbishment basis.
With a growing number of investors and developers looking for finance solutions to complete refurbishment works, the bridging community undoubtedly has a responsibility to support brokers and borrowers throughout their property journey as they build and develop their portfolios.
Therefore, the need to provide tailored, competitive products will continue to be a priority in 2022.
This is a key area Hope Capital are looking at the moment and we look forward to supporting brokers and borrowers in 2022 to take advantage of this opportunity.
