Longer-term bridging facilities are becoming increasingly important as delays across the property market make it harder for borrowers to predict when they will be able to execute their exit strategies, according to Octane Capital.
The specialist lender says facilities of 18 to 24 months are becoming more commonplace, compared with the traditional six to 12-month bridge, as lenders respond to slower transactions and potential delays involving planning, refurbishment and property sales.
The shift comes despite the average bridging loan term remaining at 12 months during the second quarter of 2026, according to the latest Bridging Trends data. Average completion times actually improved from 53 to 46 days during the quarter, while the average monthly interest rate edged down from 0.82% to 0.81%.
However, Octane Capital argues the speed at which finance is initially arranged is only one part of the equation, with borrowers also needing sufficient time to implement their eventual exit.
PLANNING DELAYS ADD TO UNCERTAINTY
Government figures illustrate some of the potential difficulties facing property developers.
Just 19% of major planning applications in England were decided within the statutory 13-week period during the first quarter of 2026.
While 91% were technically determined within 13 weeks or an agreed extended timeframe, the figures demonstrate the extent to which agreed extensions have become part of the planning process.
Separate research published by the Ministry of Housing, Communities and Local Government in January examined 80 planning cases and identified delays occurring throughout the process, from pre-application discussions through to post-decision matters.
Octane’s own research has also found one in eight new-build properties currently for sale have been on the market for more than six months.
EXTRA 12 MONTHS COULD COST £14,200
The additional flexibility does come at a price. Based on Nationwide’s July average UK property value of £277,542 and a 52% LTV, Octane calculates a typical bridging requirement of approximately £144,322.
At a monthly rate of 0.82%, interest would amount to around £1,183 a month. A nine-month facility would therefore generate approximately £10,651 in interest, compared with £24,852 over 21 months – an additional £14,201.
“Flexibility increasingly means giving borrowers sufficient time to execute their exit strategy.”
Jonathan Samuels, CEO of Octane Capital, says: “Bridging has always been about speed and flexibility, but flexibility increasingly means giving borrowers sufficient time to execute their exit strategy as well as getting the initial funding in place quickly.
“Property transactions don’t always follow the timeline you expect.
“Sales can take longer, planning can be delayed and refurbishment projects can encounter unforeseen issues, so building a realistic timeframe into a bridging facility from day one is extremely important.”
COST FACTOR
He adds: “Of course, additional time comes at a cost and our analysis demonstrates just how much more interest can accumulate over a longer term.
“That doesn’t mean borrowers should automatically opt for the shortest facility possible, but nor should they simply take the longest term available.
“The key is working with your broker and lender to establish a realistic exit strategy and assessing the total cost and flexibility of the facility rather than focusing solely on the headline rate.
“It’s also important to compare lenders carefully. Features such as having no exit fee can provide borrowers with the breathing space of a longer facility whilst still allowing them to exit early without an additional charge should their plans progress faster than expected.”
