Bridging market size debate fuelled by latest report

26 August 2011

London based real estate bridging financier Montello has published a report into the current health of the bridging market. 

They have named it the ‘Montello Report on the UK Bridging Finance Market 2011'. 

Montello has also claimed that it is the first comprehensive report on the UK bridging finance industry since Datamonitor published their report on the market back in 2006. 

The report looks at the size of the market, the regulation on it, various funding sources, and analyses recent trends in UK bridging finance. 

The report estimates that the current ‘loan book' for the UK bridging finance industry is between £415m and £755m. It notes that on this basis, the bridging finance industry represents less than 1 percent of the UK mortgage market. 

The lower end of the estimation in the report goes against the recent prediction by West One Loans that the bridging market is set to hit £1bn in two years. This prediction cannot be correct if the lower end of figures given in Montello's report are correct. 

Christian Faes, director of Montello, said: "There is a lot of debate about the size and composition of the UK bridging finance market. It is a very opaque market, as there is no single industry group that represents the whole of the short term lending industry, and there is no regulatory organisation that collects data. Hopefully this report goes some way to explaining the market." 

Ian Thomas, director of Montello, also commented: "In the report we have also looked at the different ways in which bridging finance companies are funding their loan books, the trend towards becoming FSA regulated and some of the other trends such as some lenders moving beyond purely a short term lending product range." 

"In reality the bridging finance market has contracted in much the same way as the mainstream mortgage market. However this leaves substantial room for growth in the market moving forward."