Bridging market falls back from record highs – ASTL

The figures, compiled by auditors from data provided by Association of Short Term Lenders (ASTL) members, show that bridging completions were £1.04bn in the quarter ending March 2022, a fall of 15.8 per cent on the previous quarter, when they reached £1.24bn.

However, they remain higher than the same quarter last year when completions were just over £900m. Completions have now been more than £1bn for four consecutive quarters and for the first time since records began.

Bridging applications dropped off more significantly to £6.34bn in Q1 2022, representing a cut of just over 50 per cent on the previous quarter. The size of loan books has also fallen, standing at £4.48bn at the end of March, down from £5.08bn at the end of last December.

At the same time, the value of loans in default has now fallen for five consecutive quarters, decreasing by 12.5 per cent compared to December 2021, and average loan to values (LTVs) have also dropped.

The average LTV on a bridging loan is now 58.7 per cent, compared to 61.2 per cent in the December 2021 quarter.

Vic Jannels (pictured), CEO of the ASTL said: “The latest ASTL Data Survey shows a reduction across most areas in the first quarter of 2022. However, this is set against record results at the end of last year and the volume of lending continues to be strong.

“Given the current context of global uncertainty and increased living costs, it’s perhaps reassuring that record growth has been curtailed and the market is continuing growing at a steadier pace. This points to high standards of lead qualification and underwriting across our members, who are continuing to provide the bridging finance that customers need, in a way that is robust and sustainable.

“Average LTVs have fallen and the fact that the value of loans in default has now fallen for five consecutive quarters shows that lending continues to be responsible and customer-focused.”