The UK bridging and development finance market moved into a more measured phase in the first quarter of 2026, according to the latest data from the BDLA.
The Bridging & Development Lenders Association said activity moderated across applications, completions and loan books compared with the final quarter of 2025, following a sustained period of expansion in the sector.
Completions totalled £1.8 billion in the three months to 31 March 2026, down from £2.5 billion in Q4 2025. Applications reached £9.9 billion, compared with £11.7 billion in the previous quarter, while total lender loan books stood at £11.5 billion.
The BDLA said the figures should be seen in the context of rapid growth in recent years, a more cautious wider property finance market and continued economic and geopolitical uncertainty.
Average loan-to-value ratios reduced to 56.64%, from 58.64% in the previous quarter, which the association said reflected a continued focus on responsible lending and measured risk appetite.
Development lending totalled £276.5 million during Q1, compared with £420.3 million in Q4 2025, while second charge lending stood at £131.3 million, down from £145.8 million.
The BDLA said the market remained well positioned, with lenders maintaining a prudent approach to risk and capital providers placing greater emphasis on governance, transparency and proven track records.
Its quarterly data survey is compiled by independent auditors using figures submitted by lender members and is intended to provide a broad snapshot of activity across the UK bridging and development lending sector.
Adam Tyler (pictured), CEO of the BDLA, says: “After a sustained period of strong growth, it is not surprising to see the market move into a more measured phase. The first quarter of 2026 has been shaped by a number of wider economic and global factors, and these have inevitably influenced confidence and activity across the property and mortgage sectors.
“However, the bridging and development finance sector remains in good shape, with strong foundations, experienced lenders and a clear role to play in supporting borrowers who need flexible, time-sensitive funding solutions.
“Across the wider mortgage market, the last 12 months have been challenging. Brokers, lenders and borrowers have all had to navigate uncertainty around rates, property values, transaction volumes and the broader economic outlook.
“In that context, some cooling in activity was expected.
“What gives us confidence is the continued professionalism of the sector. Lenders are being disciplined in their underwriting, capital remains available for high-quality lending platforms, and there’s a growing focus on governance, transparency and sustainable growth.
“The market is also becoming more mature. That means growth will not always be linear, but the long-term direction of travel remains positive.
“Bridging and development finance is now an established and essential part of the UK property finance landscape, the BDLA will continue to support the standards, data and representation needed to ensure the sector grows responsibly, and BDLA membership continues to provide a badge of quality for others to follow.”
