In this blog post, we delve into the fascinating world of Bridging Finance Industry Statistics. As the bridging finance sector continues to grow and evolve, gaining insights into key data and trends can offer valuable information for investors, lenders, and other stakeholders. Join us as we explore the latest statistics shaping the bridging finance industry and uncover what they mean for the market.
The Latest Bridging Finance Industry Statistics Explained
In 2014, the bridging finance industry was worth £2.2 billion.
The statistic ‘In 2014, the bridging finance industry was worth £2.2 billion’ represents the total monetary value of the bridging finance sector in the UK during the stated year. Bridging finance refers to short-term loans typically used to bridge a gap between the purchase of a new property and the sale of an existing one. The £2.2 billion value signifies the combined total of loans provided by bridging finance lenders for various purposes such as property transactions, development projects, or business investments within the UK market in 2014. This statistic highlights the significant size and importance of the bridging finance industry to the overall financial landscape during that specific year.
By 2019, the UK’s bridging finance industry had grown to £4.5 billion.
The statistic “By 2019, the UK’s bridging finance industry had grown to £4.5 billion” indicates that as of 2019, the total value of the bridging finance industry in the UK had reached £4.5 billion. This suggests a significant growth in the industry, reflecting an increase in the demand for short-term financing solutions in the UK. The growth of the bridging finance industry may be attributed to various factors such as the expansion of the property market, the increasing number of property transactions, and the flexibility and quick processing offered by bridging finance compared to traditional lenders. This statistic highlights the importance and relevance of bridging finance within the financial landscape of the UK by emphasizing its substantial economic impact and growth over the years.
A 2018 report revealed that the bridging finance sector had an average loan-to-value (LTV) ratio of 49.1%.
The statistic that the bridging finance sector had an average loan-to-value (LTV) ratio of 49.1% in 2018 means that, on average, borrowers in this sector were obtaining loans that were equal to approximately 49.1% of the value of the collateral they provided, such as property or assets. This ratio serves as a measure of risk for lenders, with lower LTV ratios indicating a lower level of risk for the lender, as the borrower has more equity in the collateral. A lower LTV ratio may be seen as favorable by lenders as it suggests a lower likelihood of default. The average LTV ratio of 49.1% provides insight into the lending practices and risk management strategies within the bridging finance sector during that period.
The average bridging loan was £595,000 in Q1 2021.
The statistic indicates that in the first quarter of 2021, the average amount of money borrowed through bridging loans was £595,000. Bridging loans are typically short-term financial solutions used to bridge a gap between the need for immediate funds and a longer-term financing option. The average loan amount of £595,000 suggests that borrowers in this period required substantial financial support for various purposes, such as property purchases, renovations, or business expansions. Analyzing average loan amounts can provide insights into the scale of financial needs within a specific market or industry during a particular period.
The average term for a bridging loan in 2017 was 11 months.
The statistic stated that, on average, the term for a bridging loan in 2017 was 11 months. This means that when looking at a sample of bridging loans granted in 2017, the average length of time these loans were outstanding for was approximately 11 months. This information is important for understanding the typical duration borrowers take to repay bridging loans in the specific year of 2017, which can provide insights into market trends, borrower behavior, and lender practices within the bridging loan industry during that period.
Upon surveying 144 bridging finance brokers, about 60% reported growth in the industry.
The statistic indicates that out of the 144 bridging finance brokers surveyed, approximately 60% of them reported experiencing growth in the industry. This finding suggests that a majority of the brokers who participated in the survey have seen an increase in their business activities within the bridging finance sector. The reported growth could be attributed to various factors such as increased demand for bridging finance products, improved market conditions, or successful business strategies implemented by the brokers. This statistic provides valuable insight into the current state of the bridging finance market and highlights a positive trend of growth among the surveyed brokers.
Bridging loans for auction properties rose by 14% in Q1 2021.
The statistic “Bridging loans for auction properties rose by 14% in Q1 2021” indicates that the total amount of bridging loans obtained for purchasing auction properties increased by 14% in the first quarter of 2021 compared to the previous quarter. This suggests that there was an uptick in demand for short-term financing to acquire properties through auctions during this period. The rise in bridging loans could be attributed to various factors such as increased interest in property auctions, favorable lending conditions, or a competitive property market prompting buyers to seek alternative financing options.
In 2019, the South East surpassed London as the region with the highest demand for bridging loans.
In 2019, the South East region exceeded London in terms of the demand for bridging loans, indicating a shift in the lending landscape for property transactions. This statistic suggests a growing trend of borrowers in the South East turning to bridging loans to bridge the gap between buying a new property and selling an existing one or to finance property development projects. The higher demand in the South East could be influenced by various factors such as property price trends, economic conditions, and investment opportunities in the region. Overall, this shift highlights the dynamic nature of the property market and the importance of monitoring regional trends in lending behaviors.
The bridging sector recorded a default rate of 0.84% in H1 2020.
The statistic reveals that within the bridging sector, which typically involves short-term loans to bridge gaps in financing for various projects or real estate transactions, there was a default rate of 0.84% in the first half of 2020. This percentage represents the proportion of loans within this sector that were not repaid as scheduled during this specific period. A default rate of 0.84% indicates a relatively low level of risk associated with lending within the bridging sector during the first half of 2020, suggesting that the majority of borrowers were able to fulfill their repayment obligations on time.
Average monthly interest rates for bridging loans fell to 0.74% in Q3 2021.
The statistic “Average monthly interest rates for bridging loans fell to 0.74% in Q3 2021” indicates that the average interest rate charged on bridging loans during the third quarter of 2021 decreased to 0.74% per month. This suggests that borrowers seeking bridging loans were able to access financing at a lower cost compared to previous periods, which could be influenced by a variety of factors such as market conditions, economic trends, or regulatory changes. A lower interest rate on bridging loans may make them more affordable for borrowers looking to secure short-term financing for property purchases or other needs, potentially stimulating borrowing and investment activities in the market.
In 2019, nearly 80% of bridging finance was regulated.
The statistic “In 2019, nearly 80% of bridging finance was regulated” suggests that a significant majority of the bridging finance transactions that took place in 2019 were subject to regulatory oversight and compliance. This indicates that the industry is largely following regulatory guidelines and standards, potentially ensuring greater transparency and protection for consumers and financial institutions involved in such transactions. The high percentage of regulated bridging finance also implies that authorities are actively monitoring and enforcing regulations in this market, which could contribute to overall stability and accountability within the industry.
Semi-commercial property was the most popular sector of loans in 2020, representing 37.2% of all loans.
The statistic “Semi-commercial property was the most popular sector of loans in 2020, representing 37.2% of all loans” indicates that among all types of loans disbursed in 2020, loans directed towards semi-commercial properties had the highest share, accounting for 37.2% of the total loan distribution. This suggests that individuals, businesses, or investors showed a preference for investing in semi-commercial properties as opposed to other sectors, such as residential or commercial real estate. The prominence of semi-commercial property loans could be attributed to factors such as investment opportunities, potential profitability, or shifting market trends, signaling a significant trend in the allocation of financial resources in the real estate sector during the specified time period.
Demand for bridging loans increased by approximately 20% post-Brexit.
The statistic indicates that there has been a significant rise in the demand for bridging loans following the Brexit event, with an approximate increase of 20%. This suggests that more individuals or businesses are seeking short-term financial solutions to bridge gaps in their funding needs. The post-Brexit uncertainty and potential economic impacts may have led to this surge in demand as individuals and businesses look for liquidity options to navigate any financial challenges or opportunities arising from the changing market conditions. The increase in demand for bridging loans could reflect a broader trend of economic uncertainty and the need for flexible financial solutions in the post-Brexit landscape.
In 2020, 20% of bridging loan applications were for commercial properties.
The statistic ‘In 2020, 20% of bridging loan applications were for commercial properties’ indicates that out of all loan applications for bridging finance in 2020, 20% were specifically for commercial properties. This statistic provides insight into the proportion of borrowers seeking bridging loans for commercial purposes compared to other types of properties such as residential or land. It suggests that a significant portion of borrowers may have been looking to finance commercial real estate transactions or projects in 2020. This information could be useful for lenders, real estate professionals, and policymakers in understanding the demand and trends in the commercial property market during that particular year.
The demand for bridging loans dropped by nearly 14% during the first wave of the Covid-19 pandemic.
The statistic indicates that the demand for bridging loans experienced a significant decline of almost 14% amidst the initial phase of the Covid-19 pandemic. This suggests that individuals or businesses were less inclined to seek bridging loans, which are typically short-term financing options used to bridge the gap between the need for immediate capital and the availability of longer-term financing. The drop in demand could be attributed to the economic uncertainty and financial strain brought about by the pandemic, leading borrowers to reconsider their financial commitments and seek alternative solutions. The decrease in demand for bridging loans may reflect a broader trend of cautious financial decision-making and a shift in priorities during times of crisis.
Approximately two-thirds of all bridging loans in 2019 were for amounts of £500,000 or less.
This statistic suggests that the majority of bridging loans taken out in 2019 were relatively small, with around two-thirds of them being for amounts of £500,000 or less. Bridging loans are typically short-term loans used to bridge a gap in financing until more permanent funding can be secured, often used in real estate transactions or other time-sensitive financial needs. The fact that most of these loans were for relatively modest amounts indicates that they may have been utilized by individuals or smaller businesses rather than larger corporations. This statistic highlights the prevalent use of bridging loans for smaller financial needs and showcases the diversity of borrowers accessing this type of financing.
Nearly 60% of brokers surveyed believed the demand for bridging finance would increase due to economic uncertainty in 2020.
The statistic indicates that a significant proportion, specifically close to 60%, of brokers who were surveyed anticipate an uptick in the demand for bridging finance in 2020 attributed to economic uncertainty. This finding suggests that a majority of brokers are of the opinion that the current economic climate, characterized by uncertainty and volatility, will lead to an increased need for bridging finance among consumers and businesses. The belief in this trend highlights the perception among industry professionals that bridging finance, which provides short-term funding solutions, may serve as a valuable financial tool to address the challenges posed by economic uncertainty in the coming year.
In 2019, the average rate for a bridging loan was 0.95% per month.
The statistic indicates that in 2019, the average interest rate charged for bridging loans was 0.95% per month. This means that individuals or businesses who took out bridging loans during that year would typically have to pay an interest rate of 0.95% of the loan amount each month. Bridging loans are short-term loans often used to finance a property purchase while waiting for longer-term financing to come through, and the interest rate provides an insight into the cost of borrowing in this specific financial product market during 2019. It also suggests the prevailing market conditions and potential risk associated with such loans during that time period.
The bridging loan completion rate increased to 84% in Q3 2020, up by 2% from the previous quarter.
The statistic indicates that the completion rate for bridging loans in Q3 2020 was 84%, which reflects the percentage of bridging loan applications that were successfully processed and finalized during that quarter. The completion rate saw a 2% increase from the previous quarter, suggesting an improving trend in the efficiency and effectiveness of processing bridging loan applications. This increase could be due to various factors such as improved operational processes, increased demand for bridging finance, or better coordination between stakeholders involved in the loan application process. Overall, the higher completion rate signifies a positive development in the bridging loan market during Q3 2020.
Conclusion
By exploring the latest statistics in the bridging finance industry, we can see the steady growth and increasing importance of this sector in the financial landscape. These insights highlight the opportunities and challenges present in bridging finance, emphasizing the need for continued research and innovation to drive further development and success in this dynamic field.
References
0. – https://www.bridgingandcommercial.co.uk
1. – https://www.www.p2pfinancenews.co.uk
2. – https://www.www.ldnfinance.co.uk
3. – https://www.www.mortgagestrategy.co.uk
4. – https://www.bridgingtrends.com
5. – https://www.www.brismo.com
6. – https://www.www.mortgagesolutions.co.uk
7. – https://www.modernfleet.com
8. – https://www.www.ftadviser.com
9. – https://www.bridgingloandirectory.co.uk
10. – https://www.www.affirmativefinance.co.uk
11. – https://www.www.mortgagefinancegazette.com
12. – https://www.www.mortgageintroducer.com
