LendInvest passes £10bn of UK Property lending: The lessons learnt, and what worries me about the future of the industry

LendInvest has just passed a milestone I’m genuinely proud of.

Since we were founded in 2008, we have lent more than £10bn to UK property investors: SME builders, developers, home owners and landlords.

In 2016, we celebrated passing £500m. Ten years later, that number is twenty times bigger. None of it came from getting everything right first time. It came from getting things wrong, listening, and changing what we do. So rather than a victory lap, I want to share what we’ve learned along the way.

We learned to follow the customer’s whole journey, not just one deal.

We started out offering short-term finance. It didn’t take long to see that our customers’ needs didn’t stop at the end of one loan. A developer who bought a site with our bridging finance then needed to build on it. A landlord who refurbished a property then needed to hold it for the long term. Each time we made a customer go elsewhere, we lost the relationship we’d built and they lost time.

So we widened what we offer, step by step, into development finance and buy-to-let mortgages. That lets us support the same customer from acquisition to construction to long-term ownership. The lesson was simple: our customers don’t think in lending products, they think in buildings and projects. We had to do the same.

We learned that reliable funding matters more than cheap funding.

In the early years, our funding was far more limited, and growth meant finding capital one step at a time. As we scaled, we built long-term relationships with banks and institutional investors, and brought our lending to the capital markets.

That changed more than the size of our book. A developer who is halfway through a build needs to know that the next drawdown will arrive on time. Deep, stable funding lets us make that promise and keep it through difficult markets. It’s why we can say today, with confidence, that capital is not what’s holding the sector back.

We learned that technology should remove friction, not judgement.

We have always believed property finance could be faster and simpler. We built our own platform to give brokers and borrowers quick decisions, clear visibility of where an application stands, and far less paperwork.

But we’ve also learned where technology stops. Every development site is different, and every developer’s plan has its own risks. The best outcomes come when technology handles the process and experienced people make the judgement. We keep iterating on that balance, and almost every improvement we’ve made started with feedback from a broker or customer who told us where we were slowing them down.

We learned that discipline is what lets you keep lending when it’s hardest.

Over those years, we have lent through a financial hangover, the Brexit referendum, a pandemic that shut sites overnight, and the sharpest rise in interest rates in a generation. Each tested us, and each taught us something. We learned to underwrite for the downside, to stay close to projects once the money is out, and to work with borrowers early when a scheme runs into trouble. Consistency through a cycle is worth more to a customer than generosity at the top of one.

We also learned something about the people we lend to. SME property investors and developers are some of the most resilient and disciplined business owners in the country. They plan harder and absorb more change than they are ever given credit for.

So, what about the next £10bn?

Here’s where I’m concerned. We are ready to lend it. The money is there, and so is the demand for homes.

What’s increasingly missing is the confidence that a scheme which works on paper today will still work by the time it has made it through the system.

Planning takes longer than anyone budgets for. Statutory consultees, highways, utilities and environmental bodies each work to their own timetable, and none of them answers for the delay. New rules and charges keep arriving mid-process. On top of that, land that should be homes sits undeveloped. Sometimes that’s apathy, but far more often it’s the rational response of developers who can’t plan with confidence in today’s market. Land that waits delivers nothing.

My ask, to central government and local authorities, is to clear the path:

• Make the journey from permission to spade in the ground predictable.
• Hold every public body in that chain to account for its part.
• Count the cumulative cost of new rules on smaller sites before adding more.

None of that means lowering standards, and most of it doesn’t need new money. I’ll be setting out in more detail shortly what I think Government can do, with the Budget weeks away.

For now, thank you: to our customers and brokers, who have trusted us with their businesses and told us, often bluntly, how to get better; to our funding partners; and to the team at LendInvest.

Here’s to the next £10bn and beyond, and to the homes it should help to refurbish and build.