Applications for bridging loans soared in the third quarter of the year rising more steeply than completions, new figures revealed.
Data released today by the Association of Short-Term Lenders (ASTL) showed bridging loan applications increased by 17% when compared to the same quarter last year.
Indeed, year-on-year annual applications hit nearly £23 billion and completions remained at more than £4 billion.
However, it also revealed the value of completions in Quarter Three (Q3) dipped by 2% on the same period last year, to nearly £940 million. Year-on-year completions went up by 1%.
At the end of the third quarter, bridging loan books totalled £4.3bn, a reduction of 6% compared to last quarter, but an increase of more than 5% on the same period last year.
Applications for loans increased even more steeply than completions, with what the ASTL described as a ‘staggering’ record £6.1 billion figure for Q3 2019
Benson Hersch, CEO of the ASTL, described the data as ‘another strong set of results’ for the bridging sector attributing the rise in applications to either intermediaries approaching more lenders, or to new lenders getting their part of the pie.
“Whatever the reason,” he added, “there is no doubt that the sector is in rude health and estimates of total loans written for the year in excess of £6 billion seem to be on the money.
“Year-on-year figures from the data survey show annual completions by members currently at more than £4bn, and they are on an upward curve. Back in September 2012, total lending was £885 million, with the billion mark being reached at the end of the following quarter.”
These quarterly figures will be the last set Hersch will preside over as CEO of the ASTL, having announced his departure, which will be effective in the new year.
He added: “It gives me a great sense of pleasure and achievement to leave the industry in such a strong position.
“It is not, however, the time for complacency. The wider political and economic environment remains uncertain and the challenge for the industry now is to continue this level of activity whilst maintaining high standards of underwriting and customer focus.”
By Kate Saines
Source: Mortgage Finance Gazette