2021 proved to be a landmark year for the UK’s booming bridging sector.
Many market-watchers had predicted that economic uncertainty would discourage investors and everyday households alike from committing to major purchases and investments for the time being. Instead, competition on the conventional housing market and the BTL market remained ferocious throughout the entire year.
Meanwhile, mainstream banks and lenders were making it increasingly difficult for prospective borrowers to access their products and services. For customers able to meet banks’ increasingly strict eligibility requirements, mortgage processing times of up to 12 weeks brought the risk of broken property chains.
While all this was going on, the UK’s specialist bridging sector was attracting record attention from private borrowers and commercial customers alike. According to the latest figures published by West One, last year was the bridging sector’s most successful year to date.
Gross bridging loan completions were up a full 32% (reaching £485 million) during the first six months of last year, increasing further to an impressive 52% by November.
Far from a temporary phenomenon, analysts believe we will be seeing more of the same going forwards. Perhaps to such an extent as to see further records fall in 2022, as the sector continues to be driven by ferocious competition on the housing market.
All of which could pave the way for further record-breaking performance in 2022, so states the lender.
Housing Market a Key Driver for the Bridging Sector
With ferocious competition from all corners, home buyers and investors are finding themselves with little choice but to set their sights on alternative financial products.
Away from the usual High Street banks and mortgage providers, the UK is home to a growing network of independent lenders and bridging finance specialists. Organised with the help and support of an experienced broker, bridging loans for property purchases can be arranged, authorised and accessed within a few working days.
Whether you are looking to beat competing bidders to the punch or perhaps pick up a bargain property at auction, bridging finance can be a uniquely versatile and cost-effective product.
It is estimated that as many as 600,000 properties are currently sitting vacant across the UK, with around 200,000 homes in England alone having been vacant for at least six consecutive months. Ideal for short-term property renovation and development projects, bridging finance is playing a key role in getting derelict and uninhabitable homes back on the market.
House Price Growth to Soften Slightly
Average UK house prices are predicted to continue growing indefinitely, but not nearly at the same unprecedented speed as over the past 12 months. Even so, getting on the property ladder in the UK is not likely to get any cheaper at any point in the foreseeable future.
Concerns regarding further property price increases are likewise driving more prospective buyers than ever before to the doors of bridging finance specialists. Where time-critical purchase and investment decisions are concerned, there is no faster or more cost-effective way to purchase a property than with a bridging loan.
Coupled with the flexibility of a facility that can be accessed with a low credit score and no conventional proof of income, the appeal of bridging finance as an alternative to traditional mortgage options is understandable.
