Commercial brokers report strong buy-to-let growth

Despite the uncertain economic outlook and changes to the tax rules around buy-to-let investments, the market has performed strongly. The figures are based on business written by NACFB brokers with buy-to-let mortgages hitting a total of £4.9bn, up from £3.5bn in the previous year.

NACFB brokers also reported robust results in the bridging finance sector where business written was £1.3bn, up 75% year-on-year.

One under performing area of the market for commercial finance brokers is alternative finance solutions, including peer-to-peer lending. The business written by members in this sector of the market fell by 14% to £725m for the 12 months to 30 June 2016. This was down from the £848m written last year.

Commenting on the dip, Adam Tyler, chief executive at the NACFB, said: “The alternative finance sector has grown at such a pace that it was inevitable that rate of growth couldn’t be sustained. Peer-to-peer will always have its place, but alternative forms of funding are no longer the only future; they are just one of many forms of finance available to small and medium-sized businesses.

However, the NACFB welcomed what was generally a very strong year for its members.

Tyler added: “There has never been a better time for businesses to secure finance, as the commercial finance sector continues to innovate and diversify. The challenge is to make sure the message reaches SMEs that there are many routes to funding.”