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Bridging lenders see growth from SME builders

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  • 03/04/2018
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Bridging lenders see growth from SME builders
Bridging lenders expect SME housebuilders to be the biggest growth driver within the market, however the sector is seeing a continued slow decline in positive attitude.

According to results from the Association of Short Term Lenders (ASTL) positivity index, more than 40% of respondents are now neutral about market prospects, up from around 30% last May.

Meanwhile, positive sentiment has dipped from above 40% to around 35% – although negativity also slipped slightly over the same period. (Click graph to expand.)

 

ASTL-positivity-index-030418

 

The trade body found the majority (78%) of members expected their business turnover to grow, with two thirds (63%) expecting the same of the bridging finance sector as a whole.

In addition, they are very positive about the prospects of providing short term finance to SME housebuilders – 93% believe this is a growth area.

However, members were slightly less sanguine about the long-term prospects of the UK economy, with positivity decreasing from 50% in December 2017 to 43%; half were unsure and only 11% were negative.

This is likely due to the protracted nature of the Brexit negotiations combined with the rise in inflation which in turn is likely to lead to higher interest rates.

 

Lukewarm Spring Statement

Property prices split the respondents with 52% expecting slight growth and 48% expecting prices to fall. And the potential impact of the Spring Statement saw a lukewarm reaction – 48% neutral and 19% negative.

ASTL CEO Benson Hersch (pictured) said: “While I remain cautious about future prospects for the UK in a very uncertain world, in which the economic climate can change overnight, members are confident that they will continue to prosper.

“The use of bridging as a financial tool, both for property transactions and for other business purposes is now well-established,” he added.

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