The latest figures released by the Association of Short Term Lenders (ASTL), showed that the annual value of completed bridging loans is £3.8bn– a 29.9% increase year on year.These figures include the first quarter of 2018, and mark an increase of 24.6% on the last figures that the ASTL produced, based on loans up to the last quarter’s data for 2017.
The value of loans in the first quarter of 2017 went up by 1.5% when compared to the final quarter of 2017. The total of loan books increased by 13.1% from the last quarter of 2017. Loan books now total £4.2bn, an increase of 35.6% compared to the first quarter of 2017.
Benson Hersch, the CEO of the ASTL, commented:
“Our figures highlight the fact that the bridging finance industry is in good shape and is ready and willing to meet the challenges and opportunities of today’s market. The bridging sector is now a well-established part of the property finance market and, barring any black swans, should continue to grow.”
Average monthly interest rates on bridging loans are 0.83%. With fierce competition between lenders, interest rates are expected to remain low, though may increase slightly if the Bank of England raises its interest rate later in 2018.
The average loan to value is 49.1%, an increase from the 46.2% for the first quarter of 2017, and completion times have reduced from an average of 50 days to 48 in Q1 of 2018.