45% of brokers cited increasing costs as the main barrier to borrowing, closely followed by a continued sense of caution around rate movements

48.5% of brokers have seen a rise in commercial mortgage applications over the past six months, according to new research from Allica Bank.

That’s up from 40% in the fourth quarter of 2024, and comes despite a period marred by global uncertainty, trade tensions, high costs, and the introduction of higher employer National Insurance contributions.

Only 20.3% of brokers reported a drop in applications, while around a third (31%) said volumes remained mostly unchanged.

45% of brokers cited increasing costs as the main barrier to borrowing, closely followed by a continued sense of caution around rate movements.

With 43% of brokers citing no major change in the reasons for borrowing, refinancing and investment purchases remain the most common. 45% of brokers reported a rise in the number of businesses looking to purchase their own premises – a sure sign that long-term stability remains a priority for established businesses.

In bridging finance, brokers reported a strong appetite for growth, with 45% reporting a rise in investments, 44% in refurbishment, and 37% in development projects.

The survey paints a positive picture of where the commercial mortgage sector is heading over the next six months – a dramatic turnaround from Q4, which showed that 51% of brokers were concerned about growth for 2025.

Charissa Chang, head of broker sales for the North and Midlands at Allica Bank, said: After a tough period, this is a sign that SME confidence is starting to return. Businesses are making decisions again, and we’re seeing more clients looking to secure their premises and invest in their long-term future, which is exactly where the market needs to be heading.

Overall, the findings suggest a more positive outlook than what might be expected, and while challenges remain, the direction of travel is encouraging. Businesses are taking proactive steps, and brokers are at the centre of that momentum, which Allica will continue to support through our ongoing investment in technology and the relationship-led business banking that brokers and their clients still value, Chang said.