Bridging Finance & Brexit: A Market Update
Having spent the year so far focussing closely on the intermediary and bridging finance markets, I’ve been having a number of conversations with people across the industry about what they’ve been seeing in 2017 and how they think the alternative lending sector will do across the rest of the year.
The latest data from Bridging Trends suggest that bridging lending fell in the first quarter of 2017 – contributor gross lending was down 5.5% from Q4 2016, and lending was also down 5.2% compared to the same quarter last year. Average monthly interest rates have also crept up from 0.78% to 0.83%.
All of this seems to be the lingering financial uncertainty that affected so much of 2016 in the wake of the Brexit vote. Bridging Trends found that the main reason being given for those seeking bridging loans was mortgage delays – with this taking up 31% of all lending. Gross bridging lending for the quarter is estimated at £118.79m, which I think is still a healthy level and I’m confident we’ll see things pick up across the rest of the year.
One reason I’m still optimistic is that the appetite for alternative and non-traditional finance in general is only rising. With the road ahead still unclear for major multinational banks operating in Britain, recent research showed 37% of investors would be considering alternative finance and short-term lending operations during the next two years of Brexit negotiations.
The same survey showed that only 9% of investors thought Brexit was likely to ruin their investment plans, and I tend to think that while we are headed into unknown waters in terms of the UK’s finance and housing markets, it’s also a time of great opportunity for bold business minds who are ready to take calculated risks.
For any recruitment needs within the intermediary and alternative lending sector, or if you’re a business development professional seeking career advancement, contact me on andrewm@kindconsultancy.com or 01216432100.
Andrew McCulloch, Kind Consultancy
