The bridging market has shown strong performance in the third quarter with faster completions and increased lending.
This is according to the latest figures from the Bridging Trends report which reveals increased lending volumes and contributor gross lending hitting £220.8mn.
The data reveals completion times fell to 46 days in Q3 2024, down from 52 days in Q2, marking the fastest average completion time since Q2 2019.
This is positive sign that signals improvement in operational efficiency which comes alongside a 9% increase in total gross lending, with contributors recording an increase from £201.8m in Q2 2024 to £220.8m in Q3 2024, continuing the positive upward trend seen throughout the year and demonstrating the market’s resilience during traditionally quieter periods.
The majority of the bridging loans taken out in Q3 were used for investment purchase – rising from 18% in Q2 to 24% in Q3. This increase suggests growing investor confidence in the market despite Q3 being the summer period.
Demand for regulated and unregulated refinance saw the biggest rise, jumping from 6 to 14% and 6 to 13% respectively. Decline in chain-break loans suggest a more stable market with fewer disruptions.
Data provided by Knowledge Bank showed that regulated bridging remained the top criteria search made by UK bridging finance brokers in Q3.
The proportion of first charge loans in Q3 increased from 88.4% to 91% while second charge loans decreased to 8% from 11.6%.
The average loan-to-value also dropped fractionally, from 59.3% in Q2 to 56.8% this quarter. Elsewhere, the average term remained at 12 months for the 12th consecutive quarter.
Commenting on the lates numbers, LDN Finance chief executive Chris Oatway said:
“Over the past quarter, we’ve seen a notable improvement in the bridging finance sector, with the average completion time reducing significantly, signalling a more efficient market all round.”
He added: “Looking ahead to Q4 2024, we expect continued momentum, with further growth in lending activity as confidence in the market strengthens. With the easing of economic pressures and a stable property environment, we anticipate more investors leveraging bridging finance to secure profitable opportunities, suggesting that the market will continue to improve as we close out the year.”
