Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Solutions. Read the original article for full details.

Bridging Lending Market Sees Slowdown After Period of Growth

The UK bridging lending market has entered a period of stability, following months of growth and uncertainty, according to new data from the Bridging & Development Lenders Association (BDLA). Figures for Q1 2026 show a decline in activity across applications, completions, and loan books compared to the previous quarter.

Quarterly lending data from the BDLA revealed that the value of bridging loan completions in Q1 2026 was £1.8 billion, down from £2.5 billion in the last quarter of 2025. Applications also fell, with a total value of £9.9 billion compared to £11.7 billion in Q4 2025. The total value of loan books stood at £11.5 billion.

The BDLA noted that these figures should be viewed in the context of rapid growth in the bridging market over recent years. Despite increased caution around property finance, the sector continues to be supported by confidence, disciplined underwriting, and demand for flexible short-term funding.

Average loan-to-value (LTV) ratios for bridging loans decreased from 58.64% in Q4 2025 to 56.64% in Q1 2026, reflecting a more measured risk appetite among lenders. Development lending also saw a reduction, with values dropping from £420.3 million in Q4 2025 to £276.5 million in Q1 2026. Second charge lending fell from £145.8 million to £131.3 million over the same period.

The BDLA stated that the market remains well-positioned, with lenders maintaining a prudent approach to risk and capital providers placing greater emphasis on governance, transparency, and proven track records. The association described the sector as maturing and entering a more measured phase, with a continued focus on responsible growth.

For UK letting agents and inventory clerks, these trends may signal a more stable environment for property transactions, with lenders prioritising sustainable practices and risk management.