Specialist brokers operating within the bridging sector have noted a major spike in activity and interest among property developers. As a result, and for the first time since February 2019, development finance is back within the top five search terms within the bridging category.
According to Knowledge Bank, which recently revealed the top-performing search terms for January 2021, there has been a significant increase in the number of searches targeting ‘development bridging and, in particular, the maximum loan to GDV, i.e., the LTV against end value’. This suggests that bridging finance is being sought by construction companies and developers for major property development and redevelopment projects.
This was the first time this particular term had appeared within the top five in two years.
No change at the top
The top three search terms remained the same for January 2021, which according to Knowledge Bank were ‘maximum ‘LTV’,’regulated ridging’, and ‘regulated bridging’ and ‘minimum loan amount’; however, the order of the three top searches changed from the month before, suggesting a shift in priorities among applicants.
In the commercial lending segment of the market, the three most popular search terms, according to Knowledge Bank”, were semi-commercial’,’ maximum LTV for commercial investment’, and ‘minimum loan amount’. A new entry to the top five for January was ‘commercial owner-occupier’.
‘First-time buyers’ also made an entry to the top five searches conducted in the buy-to-let segment for the first time since February last year. The most popular search term in the BTL bracket was ‘lending to limited companies’, which, according to Knowledge Bank, reflects the growing number of landlords looking to set off companies prior to the planned punitive tax changes.
The importance of specialist broker support
Commenting on the data, Knowledge Bank highlighted the growing importance of seeking independent specialist support to access a competitive deal from a reputable lender.
“With the end of both the stamp duty holiday and furlough scheme [in sight], lenders are certain to continue adapting criteria to keep up with the evolving market,” commented Knowledge Bank’s operations director, Matthew Corker.
“It is now physically impossible for any mortgage broker to keep all the different criteria in their heads.”
“So, it is now more important than ever for brokers to use a comprehensive criteria search system to ensure they can provide their clients with the best advice and evidence that they have done so.”
As many bridging loan specialists in the UK operate exclusively via established brokers, their products are only available with broker representation. Comparing the bridging loan market with the support of a broker can be beneficial in a variety of ways, including access to objective and impartial advice on the funding solutions available.
For more information on any of the above or to discuss the potential benefits of bridging finance in more detail, contact a member of the team at ukpropertyfinance.co.uk today.