New analysis has uncovered that a 12% increase in commercial property transactions has eased the fear of Britain leaving the EU.
In addition, research from peer-to-peer property funding platform Saving Stream found that commercial property transactions in May 2016 hit 10,790-up from 9,650 at the same time twelve months ago.
Commercial property funding surge
This rise is in part down to the increase in funding of commercial property transactions by different finance providers, including peer-to-peer lenders. Saving Stream also said that alternative finance providers have been filling the gap that had been left by regulatory restrictions constricting banks’ lending.
The trend highlighted here contrasts with the 12% decline seen in residential property transactions. These have fallen from 101,850 in May 2015 to 89,700 in May 2016.
Saving Stream believes that the fall in activity in the residential market can partly be attributed to the 3% increase in stamp duty. What’s more, the firm said that some buyers and sellers of residential homes are holding fire on purchases until the Brexit result has been revealed.
Liam Brooke, Co-Founder of Saving Stream, noted, ‘the wider use of alternative finance is a really positive development for the commercial property sector. It shows that commercial property investors are finally getting the funding they need. Alternative finance providers, including peer-to-peer lenders, are playing a big part in this by filling the funding gap left by banks. The latest figures pay tribute to this.’
‘There is no shortage of demand for commercial property development here in the UK but developers have struggled to access the funding they need to see projects through, until now. Alternative finance providers, such as peer-to-peer lenders are playing an increasingly important role in the UK economy. They help investors make higher returns, whilst funding sectors-including commercial property-that find it harder to access the financing they need. The role of alternative finance providers in funding both the residential and commercial property sectors is undoubtedly growing. This is an exciting prospect for investors,’ Brooke added.