Rangewell notes that lending in the construction sector has fallen by -7.2% in 2023 and -4.0% in 2022. There is another fall predicted for the end of this year of -5.2%, but a “high single figure” rebound is projected in the first quarter of 2025.
The decline in lending also had a knock-on effect on dwelling starts recorded over the past few years. There were 162,350 new dwellings during the 2023-24 period – a drop of -19.8% compared to the year before. This was a much more noticeable decline than in 2022-23, when there was a fall of -2.6%.
Alasdair McPherson, head of partnerships at Rangewell, explained: “The good news is we’re already seeing improved confidence across the sector, and appetites within the lending space have certainly improved during the second half of this year – and continue to grow.
“With a further cut to interest rates likely in the coming weeks and the market starting to build momentum, we expect significantly positive uplifts into 2025 – and are already seeing developers with good projects receiving significantly better lending terms than even three months ago.”
