Bridging applications continued to rise in Q4 2022
Bridging applications and loan books continued to grow in Q4 2022, according to the latest data from the Association of Short Term Lenders (ASTL).
The figures, compiled by auditors from data provided by members of the ASTL, show that bridging applications continued to rise, with £8.6bn worth of applications recorded during the quarter. This represents an increase of 9.1% compared to the quarter ending September 2022.
Bridging loan books also grew again in the final quarter of the year, rising by 6.4% on Q3 and reaching a new high of just over £6.5bn.
However, the value of completions fell to £1.3bn in Q4 2022, down by 10.4% on the third quarter of the year. Despite this decrease, bridging completions have now been more than £1bn for seven consecutive quarters.
Overall, in 2022, bridging completions increased by 15.5% on 2021 and bridging loan books increased by 28.9% on the same period, while the value of applications dropped by 13.9%.
Vic Jannels, CEO of the ASTL says: “Given the economic turbulence experienced during the final quarter of 2022, it is perhaps unsurprising that we saw a slight dip in the value of applications for bridging finance. However, bridging completions and loan books continued their strong upward trajectory, demonstrating sustained growth in the market.
“If you look at 2022 figures as a whole, compared to 2021, the value of bridging loan books has increased by almost 29%. Anecdotal feedback from the market for the first few weeks of 2023 indicates that, while activity is perhaps a little quieter than the early part of 2022, demand is still strong as more customers realise the benefits of securing short-term finance as a way of helping them to achieve their goals.
“The outlook remains uncertain, but the bridging market has shown resilience and sustainable growth. With lender members of the ASTL continuing to commit to our strict Code of Conduct, we are confident that underwriting standards are robust and well-equipped to deal with the challenges ahead. We can also look forward to the upcoming launch of the Certified Practitioner in Specialist Property Finance (CPSP) optional e-learning programme, which we are delivering alongside our colleagues at the Financial Intermediary & Broker Association (FIBA) and the London Institute of Banking & Finance (LIBF), which will help to further raise standards and support the sustained growth of the sector.”
Q4 2022 Trends
| Quarter ended 31 Dec 2022 compared to Quarter ended 30 Sep 2022 | Quarter ended 31 Dec 2022 compared to Quarter ended 31 Dec 2021 | Year ended 31 Dec 2022 compared to Year ended 31 Dec 2021
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| Loans written (£) | (10.4)% | +2.6% | +15.5% | ||
| Loan book (£)* | +6.4%* | +28.9%* | +28.9%* | ||
| Applications (£) | +9.1% | (32.3)% | (13.9)% | ||
| Loans in default (£)* | +4.4% | +16.6% | +16.6% | ||
| *As at the end of the period
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