Hope Capital reports 350% surge in loans of £1m and over

Hope Capital the short-term lending and bridging finance house has reported a huge increase in applications for loans of over £1 million, which it believes is evidence of renewed investor confidence.

The lender said new cases for these high value loans soared by 350% month-on-month in July, following the lender’s 189% year-on-year growth in cases recorded back in June.

Some 60% of new cases reported in July were for residential properties, a quarter for commercial, and the remaining 15% for mixed-use.

The average loan-to-value (LVT) of the loans, weighted by value, was under 60%.

Hope Capital recorded that 85% of the loans were specifically aimed at refinancing and capital raising. This large majority indicates that businesses were seeking to restructure their finances during the midst of the COVID-19 lockdown restrictions.

Latest government announcements include changes to permitted development rights and planning guidance, which includes proposals for easier conversions of commercial properties to residential use.

These changes provide investors with new opportunities to meet changing patterns of demand in a post-lockdown environment as restrictions ease.

Gary Bailey, managing director of Hope Capital, said: “It’s clear that there is strong demand from borrowers as the country gradually emerges from lockdown.

“There is a widespread expectation that in the post-coronavirus world, the property market will take on a very different shape. There is likely to be less demand for expensive city-centre office space, for example, and greater need for residential properties to incorporate outdoor space and areas for working comfortably and efficiently from home.

“Change brings fresh opportunities for investors, and recent planning changes mean it is easier for them to move quickly to take advantage of these. What they need is a lender who can also move quickly so that they can get their projects underway with the minimum of delay.

“Hope Capital’s flexible approach means we will always go the extra mile to understand individual projects and borrowers’ unique circumstances.

“It’s important that brokers know there are lenders such as Hope Capital that are ready to deal with cases at all levels, and go the extra mile to get finance in place quickly.”

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