The UK bridging finance sector demonstrated strong performance in 2024, maintaining steady lending volumes while significantly improving operational efficiency, according to the latest Bridging Trends annual data.
Despite broader economic uncertainties, including an anticipated general election and budgetary pressures, total gross lending for the year remained stable at £822.2 million, just 1% below the record high of £831 million in 2023.
At the same time, the average completion time for bridging loans fell by 23%, from 58 days in 2023 to 47 days in 2024, reflecting increased efficiency across the sector.
MARKET ADJUSTMENTS
Interest rates edged up slightly to an average of 0.88% per month, compared to 0.86% in 2023, reflecting broader macroeconomic conditions. However, loan-to-value (LTV) ratios remained stable at 58%, suggesting responsible lending practices and limited overleveraging by borrowers, the report said.
Raphael Benggio, head of lending – bridging finance at MT Finance, said the figures indicate a sector that continues to evolve and establish itself as a core part of the UK property finance landscape.
Benggio added: “The 2024 Bridging Trends data paints a picture of a robust, resilient market that continues to adapt and thrive despite external pressures.
“With faster completion times and steady lending volumes, these results show how bridging finance has evolved from an alternative solution to an essential component of the UK property finance landscape.”
SHIFTING BORROWER TRENDS
The data also highlighted shifts in borrowing patterns. Auction purchases increased from 7% to 11% of total loans, while chain-break financing dropped to 20% from 22%. Re-bridging transactions declined from 9% to 7%, indicating that more borrowers were successfully exiting their initial bridging loans.
The increase in auction purchases suggests that investors and landlords are turning to bridging finance as a fast and flexible funding option for property acquisitions. Meanwhile, the decrease in re-bridging transactions points to improved borrower confidence and stronger market conditions.
Phil Jay, director at Complete FS, noted a significant increase in bridging demand. He said: “Complete FS experienced a remarkable 60% increase in both regulated and unregulated cases during 2024. This growth reflects the market’s increasing demand for rapid completions.
“As bridging specialists, we’ve adapted by carefully selecting the right lenders who have not only streamlined their processes but also work with efficient legal partners in order to deliver quick and efficient solutions for our clients.”
REGULATED BRIDGING REMAINS POPULAR
Data from Knowledge Bank showed that regulated bridging remained the top search criterion among UK bridging finance brokers in 2024, as it had been in 2023. This reflects the continued demand for short-term financing solutions in both the residential and investment property markets.
The average bridging loan term remained at 12 months for the eighth consecutive year, reinforcing stable borrower expectations and lending practices.
