Paresh Raja, CEO at MFS

2019 will end how it started, but there are still many reasons for optimism




At the beginning of this year, I wrote an article for Bridging & Commercial in which I analysed the sentiment of property investors in the UK.

Back then I stated: “As we begin 2019, there is a slight feeling of hesitation among some property investors … with the country preparing for its withdrawal from the European Union on 29th March, a number are choosing to hold fire.”

Fast forward the best part of 12 months and we find ourselves in a remarkably similar position. Brexit uncertainty hangs overhead, but now with the added doubt surrounding an imminent general election. And property investors now, like then, are hesitant about committing to new purchases. 

Such uncertainty is seldom a good thing for a financial market, and property is no exception. However, the property market has — both in 2019 and over the past decade, more generally — continued to demonstrate a resilience; an ability to weather political and economic shocks.

According to Land Registry data, the average price of a UK house reached £234,370 in September 2019, up on the £228,376 recorded at the start of the year. With demand from both domestic and international buyers continuing to outpace market supply, even Brexit delays and a change in prime minister have been unable to curtail price increases.

Indeed, much like the property market as a whole, I’m proud to say Market Financial Solutions (MFS) has defied the doom and gloom predictions to enjoy perhaps our most impressive year to date in 2019. Regular readers of Bridging & Commercial will perhaps have seen a string of milestones and firsts for MFS over recent months, which have come in challenging market conditions.

A year of firsts and bests
 

MFS began the year by revising its minimum loan amount from £200,000 to £100,000 — the decision came as a result of increasing demand, particularly outside of London, for smaller bridging loans. The shift has naturally enabled us to expand our loan book and improve our foothold in regional property markets, including the Midlands.

This news was swiftly followed by the securing of a new funding line with a global investment bank. This reflected our ambitious growth plans for 2019, and with £100m of bridging loan applications received in the opening six weeks of the year alone, the strengthening of MFS’ funding lines was a vital development.

Of course, as demand for our bridging loans continued to rise, MFS also had to increase the size of its team. There has been growth across a number of critical teams within the business, such as business development managers, underwriters and marketing professionals.

Amid these internal developments, there has also been a number of achievements for MFS with new and returning clients in 2019. For example, in March we completed a £4.5m bridging loan in just four days, enabling a high-net-worth borrower to complete a property purchase they would have otherwise missed out on. 

In August, MFS completed its largest ever bridging loan to date – a £17.64m deal that supported an LLP’s acquisition of a portfolio of properties in central London, which collectively had a market value of almost £27.15m.

Seizing opportunities in 2020
 

As 2020 approaches, it is regrettable that the UK finds itself in a very similar position to a year ago. Exactly how, when or if Brexit will happen remains to be seen — so too does the identity of the person, or people, responsible for delivering this outcome.

Nevertheless, 2019 has once again underlined the ability of the UK property market to steadily advance in spite of lingering uncertainty among buyers and sellers alike. For lenders, brokers and investors, the challenge remains the same as it did at the start of the year: identifying the areas of the market where there are still exciting opportunities for growth and activities, and then ensuring one is in the best possible position to act accordingly.

I am eagerly awaiting the result of the upcoming general election and, like the bridging sector at large, am keen to see a resolution to Brexit. However, regardless of how the coming months play out, I have every confidence in MFS’ ability to continue to expand in 2020 and look forward to sharing more updates throughout the coming year with Bridging & Commercial and its readers.

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