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TODAY'S OTHER NEWS

Crowdfunding platform raises £1m-plus for buy to let schemes

Crowdfunding platform CrowdPropertyhas now raised a total of £1.43m across four residential property development projects in the UK.  

It says almost 2,000 people have become registered lenders on the platform since its launch on August 31 last year, with 160 of these having lent money to current projects and - claims CrowdProperty - they are “now earning 10 per cent per annum gross interest on their money.”

The first property development to go live on the CrowdProperty platform was a pub conversion, creating four residential flats and two commercial units, which took 14 weeks to fund. Since this, the time to complete funding has been reducing as lender liquidity increases, with the fastest fully-funded development to date having taken six weeks.

The company says it is confident that a one-week timescale will become possible within the next few months as lending appetite continues to grow.

“With any new peer-to-peer proposition it is vital to ensure that early lenders build their confidence with real returns from solid projects delivering great value” says Simon Zutshi, founder director of CrowdProperty. 

He says the revenue model for CrowdProperty involves borrowers paying a one off arrangement fee of between 3.0 and 5.0 per cent and passing the full amount of the gross interest on the loan (9.0 to 11.0 per cent per year) to the crowd of private individuals who volunteer to lend. Borrowers can apply for up to 100 per cent finance on new developments. 

Since its launch some 2,000 prospective lenders have registered on the CrowdProperty website and more than 650 potential borrowers have also made contact; almost 100 property projects have been submitted by potential borrowers for consideration. 

  • Emma  Mitchell

    Crowdfunding has really captured people's imagination at the moment, it's popping up here, there and everywhere. Registering 2,000 prospective lenders is a good amount, too. Maybe there is some future in this as a potential solution in creating more homes to meet the increasing demand.

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