Interpath & BDLA UK Bridging Market Survey 2025
Market growth expectations have surged amongst lenders and brokers as bridging finance enters the mainstream and interest rates fall, according to the second annual Interpath & BDLA UK Bridging Market Survey. But, with competition further intensifying and ongoing concerns over macro-economic uncertainty, the pressure for consolidation between providers continues to mount.
The Interpath & BDLA Bridging Market Survey monitors trends in the UK bridging finance market and collects insight from lenders and brokers and other specialists. The survey was conducted in conjunction with The Bridging & Development Lenders Association (‘BDLA’).
Interpath surveyed more than 50 lenders from across the industry representing around £12bn of annual loans. Considering average LTV rates, the survey is estimated to account for property transactions valued at around £17bn, giving a unique insight into the UK market.
The survey found that three quarters of respondents (75%) expected annual origination volumes in the market to increase, up from 62% in 2024. The view was supported by the majority (61%) of those surveyed who anticipated an increase in institutional funding to the sector amidst unabated demand. With the supply of institutional funding increasing, competition is now widely expected to intensify (63%), a position held by fewer than half (47%) of participants in 2024’s survey.
Falling interest rates are seen as a key driver for market growth with 61% of respondents having seen a decrease in average monthly rates over the past twelve months. Looking ahead, more than two-thirds of the market (76%) foresaw a further reduction. And while Loan to Value rates (LTV) are expected by most to remain stable (71%), challenges are set to emerge around credit quality as the number of respondents predicting deterioration over the next 12 months almost doubled from 11% to 20% since last year.
The anatomy of a loan – falling rates, stable LTVs and increases to size and term
The Interpath & BDLA Bridging Market Survey also examines the current profile of loans across the market. It found that the majority (59%) of respondents cited average monthly rates were between 0.75% and 1.00%, a notable change compared to 2024 when most of those surveyed identified average rates sitting between 1.00%-1.25% bracket. The detailed picture for LTVs showed that the average was 65%-70%, consistent with 2024’s results.
Meanwhile, the survey found that loans are being written for longer tenors when compared to 2024, with 43% of respondents reporting an average tenor of between 12-15 months compared to just 33% in 2024. Average loan size also appears to be rising as the ‘above £600k’ bracket entrenched its dominance in the market, rising from 34% to more than half (51%) over the year.
Challenges ahead
Survey participants were asked to identify the biggest challenges facing their business over the next twelve months. Increased competition was by far the most common challenge selected, ranked by 51% of respondents, followed by a decline in property sales volumes and time to sell (14%). Declining property values was the third most common challenge feared by those in the market (12%). When asked about the wider market, macro-economic uncertainty remained the leading challenge, ranked first by more than a third (39%) of respondents.
Stuart Mogg, managing director and head of financial services debt & capital advisory at Interpath, said: “The bridging finance market is breaking into the mainstream. Steadily decreasing rates and intense competition are making products more accessible and there is an incredibly strong consensus that these conditions will continue over the next twelve months. It feels that we are reaching a critical moment in the industry when the need for consolidation reaches its tipping point. While at the moment, such supply offers borrowers more choice to meet their needs, it will be important that there isn’t a race to the bottom and providers maintain strong underwriting and credit quality standards.”
Jenna Picken, managing director and head of securitisation at Interpath said: “At the coalface of transactions we see deal sizes increasing and loans with longer term lengths. The former is a result of the growing maturity of the sector as it appeals to a broader borrower base and funds ever more complex projects. As for the latter, economic uncertainty and slower property transactions are having an impact. All this is delaying exit strategies that are used to repay bridging finance and extending terms.”
Nick Parkhouse, head of financial services deals advisory at Interpath, said: “Our recent conversations with management teams and business owners point to a clear shift in sentiment. After an extended period of subdued M&A activity, sellers are increasingly ready to transact, and buyers are gradually considering returning to the table. The findings of our latest survey highlight a sector that continues to grow, underpinned by strong fundamentals and increasing investor interest. A number of bridging lenders are now well positioned to become platforms for the build-out of broader SME lending strategies — an angle that should resonate strongly with equity investors seeking scalable opportunities.
“Of course, competition remains active, and signs are emerging that the next 12 to 18 months could be a period of consolidation. Many businesses are already evaluating acquisitions as a route to achieving scale, geographic reach, or product diversification. After years of anticipation, it feels like the bridging sector may finally be approaching its moment for meaningful M&A activity.”
Vic Jannels, CEO of The Bridging & Development Lenders Association (BDLA), commented: “The findings of this year’s survey confirm what many of us in the industry have been experiencing first-hand – bridging finance is becoming an increasingly mainstream solution for borrowers. Falling interest rates, greater institutional appetite, and rising loan values all point to a sector maturing with confidence. But with this growth comes responsibility. It’s vital that lenders maintain robust underwriting practices and uphold transparency, particularly as competition intensifies and the demand for larger, longer-term loans grows. At the BDLA, we believe strongly in sustainable growth underpinned by professionalism, and this report provides valuable insight for lenders looking to navigate the opportunities and challenges ahead.”
Interpath has published a report to summarise the findings of the survey and including insight from key figures from across the bridging finance market, including JP Morgan, AB CarVal, LendInvest PLC, TAB, Brightstar, Shawbrook, Castlelake, MSP Capital, MT Finance, Ultimate Finance, Lloyds Banking Group, Crystal, Capital B Property Finance, Pollen Street Capital, Together Money and Quilam Capital.
A full copy of the report can be found: Interpath & BDLA: 2025 UK Bridging Market Survey