News: Bridging industry grows 26 per cent
The market for bridging loans grew over a quarter in 2014, the latest figures have suggested.
The Bridging Index takes into account the year period from December 2013 to November 2014. Its latest figures have shown an increase of 26 per cent over 2013; the total revenue for the sector now stands at £2.42 billion.
The market is now three times bigger than when the index was first used in 2011. At that time the size of the market was reported to be £0.8 billion.
Reports suggest that the pace of growth seems to have balanced out a little when compared to the figures from 2012, when the industry grew 74 per cent.
An industry figure stated: “We have now entered a more stable phase of development, but annual growth of more than 25 per cent is still some going and proves that the market still has plenty of capacity for further improvement."Points of interest
With loan-to-value ratios, a tool used by lenders to assess risk, for which a higher value means a greater risk, the average currently stands at 48.4 per cent.
Over the year-on-year period the average loan size grew 17.2 per cent, reaching £508,000.
The average monthly interest rate on bridging loans was 1.16 per cent, down from 1.22 per cent in 2013.
Commenting further: “As perception of the bridging industry continues to improve and awareness of the usefulness of the products spreads, then there is no reason why the sector can’t build on its previous successes and carry on growing into 2015."
Why use a bridging loan?
With Affirmative you can borrow short-term bridging finance between £10,000 and £2 million for your project, whenever you need funding fast. A typical loan is secured as a first charge against a property: from 1% monthly interest, with typical APR 28.9%. It can be ready in less than 24 hours.
To find out more call our Manchester office, 08000 44 84 84.