Bridging lending by value increased by 35% year-on-year to April 2015 despite the mortgage market retracting by 4% over the same period, the West One Bridging Index has revealed.

Short-term lenders provided more than £2.7bn annually to April, up from £2bn in the year to April 2014. Volumes also rose by 13% year-on-year.

In the first four months of the year £1bn was lent, as from January to February short-term lenders provided £418m and £582m was lent from March to April.

Duncan Kreeger, director of West One Loans, said: “While the mortgage market never looked like recreating its strong start to 2014 in 2015 – due in no small part to the uncertain economic climate created by the election – such worries didn’t plague the bridging sector to the same extent – enabling it to continue on its upward trajectory.

“In fact, just as all the election hype was reaching fever pitch in March and April, bridging lenders were beavering away recording one of their busiest and most profitable periods ever, with more than half a billion of short-term finance lent.

“The market has continued in a similar vein since then, with records being broken left, right and centre and the latest annual gross lending figure confirming that the £3bn milestone is now firmly in the crosshairs.

“There is a real buoyancy and can-do attitude about the sector at the minute, with lenders and brokers keen to get deals done and competitive rates helping add to the attractiveness of short-term finance. As we head into summer and the weather warms up, there is certainly no sign of the bridging market losing heat.”

The index also found that typical loan-to-values have increased by 2.2% year-on-year to stand at £49.2% annually to April 2015. In terms of interest rates they averaged 1.15% to April, down from 1.18% the year before but higher than 1.05% to March 2015.

West One said the market has no lack of funding as investors still see bridging as an opportunity.

Kreeger added: “As with the mainstream mortgage market, just when you think interest rates have bottomed out, they edge that little bit further downwards.

“We’re unlikely to see them decrease too much further now though, with lenders instead focusing on innovation and flexibility rather than erode margins any further.

“One thing that is for sure is that the foundations underpinning the bridging sector’s growth are deep and strong and we are poised for further growth throughout 2015.

“As the market continues to expand there are bound to be more sources trying to accurately capture the sector’s performance, but the West One Bridging Index remains the original and authoritative voice on all short-term finance matters.”