Comment
New lenders grabbing market share
Numbers reveal the sector is not growing as competition steals a march on established lenders
taken a tumble significant tumble in so far as lending volumes go.
by Fahim Antoniades, group director, Mortgage Centre IFA
With the first three months of the year out of the way it’s probably a good time to take stock and reflect what the past quarter has brought for the industry and the main players involved. Taking a quick peek at the Association of Bridging Professionals’ website, its market report analysis shows some interesting movements for the month of February – the most recent available month of data. Masthaven and Omni Capital
have taken the top two spots whereas the usual top dog – Dragonfly Property Finance – has
COMPETITION Whilst March figures are unavailable at the time of writing, at first glance the rolling three months to February shows an erratic pattern of lending volumes (see graph). However, on looking closer there does seem to be a pattern and of notable interest is that the bigger established players are seeing a decline in lending volumes, whereas the newer or smaller ones are showing an increase.
Whether the time snap-shot is too small to draw definitive conclusions from is another matter but if one were to infer anything from this it would have to be that either the smaller and newer players are providing fierce competition to the established
larger ones or that the latter group need to call in some loans and recapitalise before they are able to drive volumes again. Whilst the truth probably lies somewhere in between, I can’t help thinking whether there might be something else at play.
MARKET STATIC Could it be that we are coming off the crest of the bridging bonanza wave so often reported about in the trade press? Much has been talked about how bridging has moved on to new levels and how this has sparked innovation, drive and new entrants to the market. Yet the past three months’ data sample shows the larger players going through a significant downturn in volumes. There were and still are many who have warned about over- exuberance in the sector. That the relatively sudden wave of new entrants to the market has been more due to a self-fulfilling prophecy driven by over-hype and attention in the media as opposed to being founded on actual market growth.
Source: AOBP
www.mortgageintroducer.com
EXIT FINANCE RESTRICTIONS Are we then witnessing a slowdown in bridging forced by a lack of exit finance? In the end it could well be that we look back on history and see that the very conditions which sparked the bridging boom in the first place – lack of liquidity – is the very thing which eventually kills it off.
BRIDGING INTRODUCER MAY 2012 17
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