While I have been taking a well-earned break from the intense world of specialist lending and focusing on my wellbeing (something I neglected for about 27 years), multiple factors have impacted our cherished and vital industry.
As I sit by the pool at the spa, here are some thoughts on the challenges we need to acknowledge and some light at the end of the tunnel.
ECONOMY STAGNANT
Firstly, the UK economy has been stagnant, and sadly there is no one I know who has faith in Keir Starmer and his party (just look at the gains Reform and the Greens are making).
Focusing on data relevant to the lending market, the outlook is quite gloomy: house sales are dropping, mortgage rates are rising, and the cost of living continues to worsen, with taxes at record levels while Labour increases benefits, reducing the incentive to work. I worry that a recession is not far off, if it is not already a reality.
CENTURY CAPITAL AND MFS
Secondly, the recent events around Century Capital and MFS have damaged the reputation of specialist lending, particularly bridging.
For the last 10 years, many key industry players have worked hard to raise the integrity of the bridging space, and they have done a wonderful job.
Sadly, the institutional and private equity funders of many lenders are now in full audit mode, as the feeling is that they have lost trust in the market. I would argue that such funders should have had more robust governance in place from the start and may have been able to identify issues much earlier.
The lack of peer-to-peer communication is clear in the unfortunate events that have unfolded. While steps are now being taken, many non-bank lenders are being audited by their funders, and banks have moved up the risk curve.
“I fear there will be more negative findings to emerge and the true impact is yet to be felt.”
I fear there will be more negative findings to emerge and the true impact is yet to be felt. It is a great shame, as the overall impact is ultimately felt by the consumer, whom we are all supposed to be working for.
The end customer will face longer completion times and more risk assessments, possibly affecting their desired outcomes.
Organisations like the BDLA and the NACFB have a huge role to play in ensuring the bridging market emerges stronger from this blip by applying stricter due diligence to members.
THE IRAN WAR
Finally, we have the illegal Iran war led by the all guns blazing Donald Trump. To me, it is clear he has underestimated the task and paid no attention to the fact that Iran controls a stretch of water that accounts for approximately 20% of global oil and gas transportation.
The results are well documented, with stock markets dropping and energy and food prices increasing, with potentially more to come. The UK is already in a difficult position, so this will make matters much tougher for the average citizen. If the situation cannot be resolved or controlled soon, I dread to imagine the short-term future.
HOPE SPRINGS ETERNAL
So why do I still feel optimistic about the specialist lending industry?
Let’s start with bridging. The market has grown year on year for many years and currently has a record sized loan book.
When times are tough, bridging prospers – if done correctly. Just look at the record lending figures Together posted for last month (March 2026).
Together had a record month with £361m of lending, of which £174m was unregulated bridging. What this tells me is that consumers need specialist lenders more than ever when times are tough and high street lenders move up the risk curve.
The opportunity is growing and, by working with knowledgeable broker partners, there is plenty of demand if the lender truly wants to lend.
RENTERS’ RIGHTS ACT
Next, I will discuss buy-to-let. The Renters’ Rights Act comes into play from 1 May. Yes, it is true that many landlords have felt this is the final nail in the coffin and have left the market, but in fairness this mainly applies to amateur landlords.
Professional/portfolio landlords have adapted ever since the various measures introduced against them from the days of George Osborne.
To put it simply, the UK housing market cannot survive without a strong Private Rental Sector (PRS), as social housing is inadequate.
“Without the PRS, we would face critical housing issues.”
Without the PRS, we would face critical housing issues. Many industry experts, me included, have been vocal about this to both the current and previous governments, but they still do not understand, or perhaps they feel that targeting landlords (around 5% of the UK population) will help them win votes.
It is controversial, but it has to be considered, as I cannot see the logic in the continuous punishment of the PRS.
Professional landlords are generally savvy, with many focusing on remortgaging to secure stable rates and leveraging equity to maximise opportunities arising from amateur landlords’ departure.
So, while the number of participants may have reduced, demand for rental housing is still there and is becoming increasingly concentrated in the professional space.
This actually makes it a more manageable and experienced market, which should give lenders confidence to lend. OSB launching Rely as its dedicated BTL powerhouse is a positive indication of support for the opportunity in the market.
COMMERCIAL LENDING
Finally, commercial lending. Brokers have reported that the biggest increase in enquiries over the last 12 months has been in commercial lending, whether bridge or term.
While it comes with greater risk, consumers are prepared to put more “skin in the game” because the returns can be excellent.
Many lenders have increased their commercial appetite over the last 12 months, just look at MT Finance, led by the highly experienced Marylen Edwards. This is great news after COVID and the “lettuce” days of Liz Truss. I can see the commercial space having a strong future if the economy can remain stable.
So, in summary, the specialist market is going through a tough time, but history shows us that it is resilient.
The passion of the people within it will help it battle on and overcome the current challenges, because consumer demand remains strong.
As long as we do not panic, continue to talk, and share good practice, the industry will emerge back into the light. The only unknown is the timing.
