Bridging and development finance activity has continued to slow down, with participating lender members reporting lower applications, completions and loan book values in Q2 2026, the Bridging & Development Lenders Association (BDLA) has revealed.
In the three months to 30 June, completions fell by 15.2% quarter-on-quarter to £1.6bn, while applications also dropped by 26.3% to £7.3bn in the same period.
Meanwhile, total reported lender loan books reduced by 10.6% to £10.3bn.
The BDLA said the figures follow the reduction in activity reported in the first quarter of the year.
It added that feedback from the market points to subdued property transaction activity and often protracted completion times, which has put pressure on new business pipelines and sharpening lenders’ focus on exit strategies.
Development lending also slowed in Q2, totalling £273.5m compared with £276.5m in Q1.
Second charge completions totalled £101.1m, down from £131.3m in the previous quarter.
Average LTV ratios increased from 56.64% to 57.66% in the same period, and the reported value of loans in default fell by 0.4% quarter-on-quarter.
The BDLA’s CEO, Adam Tyler, said bridging and development lenders are not "alone in experiencing a quieter market".
He concluded: "What I am hearing from lenders is a greater emphasis on due diligence and on testing those assumptions at the outset. The priority is to support viable transactions with credible exit strategies that reflect the market as it is, rather than relying on expectations of a quicker sale or an improvement in conditions.
"The economic implications extend well beyond specialist lending. Housing development and property transactions support activity across construction, professional services and the wider economy. When activity slows, the effects are felt by many more businesses than those directly involved in providing finance. And this is an important part of the message we’re taking into our discussions in Westminster and with organisations including the Bank of England and the British Business Bank.
"The health of the bridging and development finance market is closely connected to wider property activity, housing delivery and business confidence, so understanding what is preventing viable transactions and developments from progressing matters well beyond our own sector."
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