The Intermediary – February 2026 - Flipbook - Page 28
BRIDGING
Opinion
What to expect from
the 2026 market
A
s 2026 begins, the
bridging market
finds itself at a
crossroads. Aer an
extended period of
caution following the
recent Budget, activity appears to be
accelerating, leading to a surge in deal
flow and a record expansion of the
sector’s loan book. Reflecting on 2025,
the Bridging & Development Lenders
Association (BDLA) is reporting
another record-breaking year with
loan books surpassing £13bn. The
continued increase in volume follows
from the £10bn generated in 2024.
This momentum confirms what
we at LendInvest have long observed.
Bridging finance is no longer a niche
or reactive solution. Instead, it has
matured into a core funding solution,
supporting transactions that require
speed and flexibility.
Continued resilience
The specialist bridging lending sector
enters 2026 with sustained confidence
and a proven capacity for adaptation.
Investor confidence remains
strongest in the North and Midlands,
where pricing discipline and value-led
strategies continue to drive activity.
Meanwhile, greater fiscal stability
has unlocked transactions that were
previously paused, resulting in a
strong pipeline entering the year.
In addition, as lenders have refined
risk frameworks and invested in
digital processes, brokers have
increasingly moved into advisory-led
roles, structuring more complex and
bespoke transactions.
Short-term finance in 2026
It is clear success in the 2026 market
will be defined by agility and capital
preservation, with bridging and
development finance the primary
mechanisms for unlocking value.
From the resurgence of residential
chain-breaking to the necessity of
‘green’ refurbishment, the following
26
The Intermediary | February 2026
four pillars represent the most
significant drivers of volume and
opportunity for developers and
investors alike:
Regulated bridging: No longer
just a fallback, it is becoming a
mainstream tool for residential
buyers navigating chain delays
rather than a contingency option.
Development exit finance: A
strategic lifeline for 2026, allowing
developers to avoid distressed
sales and hold for the right price
while recycling equity into
new acquisitions.
The refurbishment “silent engine”:
The quiet powerhouse of the
industry, fuelled by the urgent need
for energy performance certificate
(EPC) compliance and the transition
to high-performance buy-to-let
(BTL) portfolios.
Commercial-to-residential
conversions: A high-yield frontier
where underused secondary assets
are being revitalised into modern
homes in multiple occupation
(HMOs) through Permied
Development rights.
Agility and evolution
While demand in the market remains
strong, the operational environment
for lenders is becoming more exacting.
Rising funding costs and evolving
regulation are widening the gap
between traditional models and more
adaptive lenders. Three structural
shis will shape 2026:
Managing the “exit ceiling”:
With interest rates stabilising at
higher levels, exit viability has
become the primary underwriting
consideration.
The regulatory thaw: Ongoing
dialogue around the Financial
Conduct Authority’s (FCA’s)
approach to regulated bridging
terms reflects a growing recognition
of real-life timelines.
The digital efficiency gain:
Advanced digital systems have
LEANNE ARDRON
is managing director, shortterm loans at LendInvest
transitioned from a unique selling
point to a baseline requirement for
the modern lender. At LendInvest,
our ‘tech-enabled, expert-led’
model ensures that technology
handles the heavy liing of data
and administrative processing.
Automated valuation models
(AVMs) and digital risk assessments
streamline the journey for our
brokers and borrowers.
Delivering certainty
In an era where “cheap capital” is no
longer the sole differentiator, the true
value of a lender in 2026 is measured
by certainty. Investors and brokers
need more than just funds; they need
a partner who provides the confidence
to move decisively and provide support
throughout the entire journey.
As we look toward the remainder
of 2026, the most successful property
professionals will be those who value
the durability of their strategy over the
marginal gains of a lower interest rate.
Value is found in the certainty, speed,
and reliability of the capital provider.
Ultimately, the most effective way
to have a stable project in 2026 is to
partner with a lifecycle lender. A
bridge-to-let approach secures an
exit at the same moment the bridge
is initiated. This strategy does more
than just eliminate “exit anxiety”; it
provides a significant boost to ROI
and progresses property projects at a
swier pace.
Think of bridging finance as a relay
race. The most successful projects start
with the exit in sight and a trusted
partner ready to take the baton. ●
