Members of the Association of Short Term Lenders lent £319.4m worth of development loans in the final quarter of 2017.
Of that total £197.8m was classed as bridging but excludes what is generally termed “light refurbishment”, such as addition or renovation of bathrooms, kitchens and conservatories.
The figures come at the end of a strong period for ASTL members with annual completions exceeding £3.5bn.
Benson Hersch (pictured), chief executive of the ASTL said: “The housing crisis continues to be high on the government’s agenda and Sajid Javid highlighted last year that he wanted to do more to support SME building firms.
“Increasingly these small developers are relying on short-term funding solutions, because traditional forms of finance are often not available to them.
“Such a trend demonstrates how alternative forms of finance are providing the solutions where the government and the banking industry should be and could be bridging the gap.”
Ashley Ilsen, chief executive of Magnet Capital echoed Hersch, adding: "The government continues to make a great deal of noise about the need for increased levels of building and is keen to push forward it's house building agenda.
"These figures show that it continues to be the specialist finance sector that helps developer work towards achieving those goals. The value of the market is sometimes missed and the vital role this industry plays in filling the voids left by mainstream banks needs to be recognised."
