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Maintain and Successfully navigating the evolving specialist property finance sector
WHAT ARE THE LATEST TRENDS AFFECTING OUR SECTOR?
WHAT ARE YOUR CURRENT GROWTH AREAS?
WHAT GROWTH OPPORTUNITIES DO YOU FORESEE IN THE FUTURE?
Andrew Lazare
Andrew
Andrew
With the ongoing appeal of ‘the right property developer’ working on the 'right project’ being able to make significant returns, the market continues to attract an increasing number of entrepreneurs. However, it is the very definition of the right project that is evolving to reflect the changing property landscape.
Our motto is ‘maintain and grow’, as we successfully navigate this evolving specialist property finance sector. Analysis of the UK bridging market trends and data informs us that the sector continues to grow, a sentiment that is reflected in Mint Property Finance recording its biggest-ever January and February on record at the start of this year. That said, as the requirement to add value to properties, navigate legislation, and progress more, smaller projects become the new normal, there is an increasing requirement for us to further strengthen the key facets of our business. Firstly, it’s imperative that Mint maintains the long-standing high performance of its loan book and that we grow it safely with only the right loans, not just any loan. The minimisation of extensions, renewals, and defaults is of paramount importance to us, which is why we give all borrowers, brokers, and professional introducers direct access to our underwriters. Without this, cases cannot be fully assessed, and challenges will arise. Secondly, we need to maintain our structure and grow our team in the right areas. It’s only by retaining the incredible talent we have nurtured here at Mint and attracting new superstars to our business that we can sleep easily in our beds knowing that our borrowers and investors are protected. Our team are our safety net, and I couldn’t be prouder of the sterling work they do in increasingly challenging circumstances. Finally, we need to maintain the incredible partnerships we have in place with our borrowers, brokers, professional introducers, solicitors, valuers, project monitoring surveyors and asset managers, as well as grow our collective experience as we move into an increasingly innovative market. As Adam and Sam both observed, the days of straightforward bridging and development finance are gone. We need to collectively leverage our partnerships to ensure we are at the forefront of the market as we seek to successfully fund ever more innovative, inventive and inspired projects across the UK.
MANAGING DIRECTOR The latest legislation continues to change the investment landscape for individuals trying to earn an income through property. BTL as an asset class is becoming more difficult, as ‘passive’ monthly returns get slimmer. Thus, the majority of successful BTL landlords that we engage with now have to resort to adding value to properties through refurbishments and extensions to generate financial returns. Adding to this challenging property investment landscape is a headwind of potential non-compliance, where HMOs are concerned. With changing legislation around room sizes and kitchen location, many landlords are facing the very real threat of not having their licences renewed. For older properties, landlords will face the renovation expense and void rental periods associated with returning larger houses to traditional, residential demises. The third challenge facing those developers working on potential ground-up apartments and houses, is the increasing trend by local planning teams towards the assignment of local occupancy restrictions. The unforeseen, negative consequences of this mean that residents ultimately live in less desirable residential properties built on compromised sites, too small and not finished to a satisfactory specification, as developers seek to reduce costs.
Adam Robson
HEAD OF KEY ACCOUNTS There is still plenty of oppor tunity in the current market, and this will continue to be the case, but there is now a requirement for property investors to be more innovative in their approach. Gone are the days of BMV purchases using straightforward bridging loans delivering significant returns. Instead, we’re seeing an increasing volume of enquiries for smaller loan amounts, more frequently involving property refurbishment before rental or sale. Adding value through investment seems to be increasingly the norm in a market where renters are demanding more for their increased monthly rent, and sale values still haven’t yet returned to previous norms in certain areas.
Sam Herd
HEAD OF CREDIT The trend towards an increasing vol ume of smaller loans extends into the ground-up development sector. We’re seeing more enquiries with a comparatively smaller number of apartments and houses, with lower exit sale prices, only in areas where demand is almost guaranteed. Garden plot developments are seeing a resurgence in popularity as developers look to minimise their risk exposure.
Bridging & Commercial
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