The House Crowd Shortlisted for Crowdfunding Platform of the Year

The House Crowd Shortlisted for Property Wire Awards Crowdfunding Platform of the Year

We are very pleased to announce the news this week that we have been shortlisted in the Property Wire Awards 2017 for the Crowdfunding Platform of the Year.

Property Industry Innovation

There are so many changes going on in property these days. Property crowdfunding (thanks to us, the first platform ever!) is currently worth £700 million in the UK alone, and we are proud to be at the forefront of this great alternative finance innovation. But property is also coming on leaps and bounds across the board, with adoption of exciting new technologies and business models.

About Property Wire

The premier global property news service, Property Wire, holds this annual awards ceremony to recognise companies who are embracing the current changes within the property industry. The awards are designed to champion companies who not only innovate and evolve into the new PropTech era, but also push the boundaries towards a new and exciting future for real estate.

Property Wire focuses on global news from both the residential and commercial property sectors. The website boasts an audience of 70,000 readers, encapsulating everyone from estate agents, property developers and surveyors, to architects and, of course, property crowdfunding platforms!

On The Property Wire Awards Shortlist!

We are thrilled to have been shortlisted this year. It is an honour to be recognised for all the hard work we put into democratising property investment and boosting the supply of high-quality homes in the Greater Manchester area.

We’re shortlisted alongside both Homegrown and Landlord Invest. Both are great platforms themselves, so it’s fantastic to be against such stiff competition!

The awards ceremony is set to take place on 24th March at M by Montcalm on Old Street in London. It’s set to be a good night to get together with fellow property industry innovators, explore other developments within the property industry as a whole, and (hopefully!) pick up an award for our contribution to the property crowdfunding space.


To find out more about property crowdfunding, register on our site for further information (no need to invest straightaway!) by clicking the purple button.

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Alternatively, why not browse our current property investment opportunities? That’ll be this button:

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The Dire Housing Crisis Needs The Help of Property Crowdfunding

The Dire Housing Crisis Needs The Help of Property Crowdfunding

The housing crisis in the UK doesn’t just restrict our ability to provide the much-needed homes the country’s population needs. It’s also, according to Katja Hall, the Deputy Director-General of CBI, costing UK households £4bn a year.

Of this figure, £3.2bn is down to increased housing costs, and the remaining £770m is due to higher transport costs, as inability to live near work drives more people to commute expensive distances from work. This is, of course, exacerbated by soaring fuel prices and train fares.

Housing shortages are also pushing up market rent at a time when, for the majority of households, disposable income remains weak.  The high cost of moving home and lack of decent and affordable housing also deprives businesses of the flexible and mobile workforce necessary for them to grow and thrive. In short, people and businesses are paying the price for our lack of new homes.

We know that we need to double the number of new homes we provide every year to meet demand, and have been falling shockingly short for years.

House Builders’ Hands Are Tied

Combined with difficulty accessing available land for building on, despite only 10% of the UK’s land being developed, access to finance continues to pose a major barrier for small and medium sized house builders, further exacerbating the housing crisis. The government needs to focus its spending on capital investment in housing stock, but house builders also need access to alternative forms of finance in order to make a dent in the provision of new housing.

Secured peer-to-peer lending to house builders offers a marked solution to the problem. Provided house builders can secure planning permission, access to finance through the property crowdfunding industry has the potential to keep house builders afloat, whilst simultaneously assisting with the provision of these desperately needed new homes.

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Property Developers Need Finance

Along with the problem of providing new builds, there are also an estimated 650,000 empty properties in the UK, over 200,000 of which have been left empty for over six months. Whilst house builders take care of the situation of building new accommodation altogether, there is also much scope for developers.

Many of the empty homes in the UK require significant renovation, and one of the barriers for developers who would do so is the un-mortgageability of these properties. Properties come up for sale by auction all the time, but without ready access to funding, there is no way for most people to take up the investment.

Bridging finance, again offered within the property crowdfunding model, can tide investors over so that they may make those time-sensitive investments. Peer-to-peer funding for renovation work also opens the doors to small and medium-sized property developers to work their magic and provide modern, high-quality homes.

Equally, straight-up crowdfunded investment projects do the same job of bringing high-quality housing to market.

The Government’s See-Saw Success

Government investment in build-to-rent is promising, with a £45m cash injection for 2,000 new homes in the North being announced late in 2016. However, optimistic news back in October of government promises for 225,000 new homes by 2020 was shadowed by the mention that only 15,000 of these would be ready for habitation by then.

Realising their inability to cope with the housing crisis themselves, the government has recognised the solution that the property crowdfunding industry is offering to the crisis, and has provided significant investment in the model.

We are confident that the property crowdfunding industry will be instrumental in helping to alleviate at least some of the problems with UK housing stock, whilst also offering an alternative investment option for those seeking to invest in the property market themselves.

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Name That Book!

Frazer, our CEO, has written another book – his first one was a novel called The Cheshire Sect which is available to buy on Amazon.

This second book is all about how you can build your wealth using property crowdfunding.

It’s due for publication in April but, before it’s published, he would like your advice on what to call it.

We’ve narrowed it down to two potential titles. Just click here to tell us which you think is best.


To find out more about investing with The House Crowd, you can register with us by clicking on the purple button below. Alternatively, take a look at our current property investment opportunities by clicking the blue button! Either way, we’re always here to answer your questions in any way we can.

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Performance Statistics: February 2017

Performance Statistics: February 2017

The figures are now in for our performance statistics from last month. You will see below our summary figures from the dividend, interest and capital payments made in February 2017. You can also see our total cumulative returns from 2013, which you may also find helpful to know.

February 2017

  • Projects paid out against = 22
  • Total value of dividends and interest paid = £73,730.53
  • Total value of capital repaid = £493,000 (1 x development capital, 1 x bridging loan)
  • Total number of investors paid = 478

Total for 2017 So Far

  • Projects paid out against = 44
  • Total value of dividends and interest paid = £156,425.94
  • Total value of capital repaid = £866,000 (1 x development capital)
  • Total number of investors paid = 1,020

Cumulative (from January 2013)

  • Project paid out against = 478
  • Total value of dividends and interest paid = £1,292,050.94
  • Total value of capital repaid = £5,871,720.00
  • Total number of investors paid = 9,518

To find out more about investing with The House Crowd, you can register with us by clicking on the purple button below. Alternatively, take a look at our current property investment opportunities by clicking the blue button! Either way, we’re always here to answer your questions in any way we can.

Register Now for more Info

View our Property Investments

 

Performance Statistics: January 2017

Performance Statistics: January 2017

The figures are now in for our performance statistics from last month. You will see below our summary figures from the dividend, interest and capital payments made in January 2017. You can also see our total cumulative returns from 2013, which you may also find helpful to know.

January 2017

  • Projects paid out against = 22
  • Total value of dividends and interest paid = £82,695.41
  • Total value of capital repaid = £373,000 (1 x development capital)
  • Total number of investors paid = 542

Total for 2017 So Far

  • Projects paid out against = 22
  • Total value of dividends and interest paid = £82,695.41
  • Total value of capital repaid = £373,000 (1 x development capital)
  • Total number of investors paid = 542

Cumulative (from January 2013)

  • Project paid out against = 456
  • Total value of dividends and interest paid = £1,218,320.41
  • Total value of capital repaid = £5,378,720.00
  • Total number of investors paid = 9,040

To find out more about investing with The House Crowd, you can register with us by clicking on the purple button below. Alternatively, take a look at our current property investment opportunities by clicking the blue button! Either way, we’re always here to answer your questions in any way we can.

 

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Peer To Peer and Development Performance Stats

December 2016 Summary P2P & Development Stats

December 2016 Summary Monthly Statistics can be seen below.

Bridging Loans   31/12/2016
  Gross Net
Total Amount Lent £10,773,024 £9,624,670
Total Returns Paid £292,637 £292,637
No of Loans 28
No of Loans Repaid 14
Average Loan Period 10
Investors Capital Lost £0
Average Loan Size £384,751 £343,738
Average Loan to Value 70%
Average Interest Rate Paid 9.00%
Average Interest Rate Offered 9.08%

 

Development Loans   31/12/2016
  Gross Net
Total Amount Lent £8,865,861 £8,019,571
Total Returns Paid £46,862 £46,862
No of Loans 12
No of Loans Repaid 2
Average Loan Period 9
Investors Capital Lost £0
Average Loan Size £738,822 £668,298
Average Loan to Value N/A
Average Interest Rate Paid 14.00%
Average Interest Rate Offered 11.92%

You can find all our latest investments by clicking here.

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Manchester Property Market Growth at 12 Year High

Manchester Property Market Growth at 12 Year High

Latest figures released by the Hometrack Index show Manchester property market growth to have hit a 12 year high in 2016. This gives the city the second highest rate of price growth in the UK, next to Bristol.

A rise of 8.9% year-on-year for Manchester was reported, with experts predicting that the city will overtake Bristol for pole position by the end of the first quarter of 2017. The figures for Manchester exceed the average year-on-year increase across the UK, which came in at 7.7%.

Strong market fundamentals, particularly a significant supply/demand imbalance in Manchester, keep pressure on prices high. Despite the same supply/demand imbalance in the capital however, London dropped to seventh place for price growth in 2016.

Strong Market Fundamentals Keep Manchester Property Market Growth Thriving

Manchester’s vibrant rental market is also thriving, with demand continuing to grow. This, of course, makes it a dream opportunity for buy-to-let investors. Indeed, the city was recently named the UK’s buy-to-let hotspot by HSBC. This is all despite the massive challenges faced by buy-to-let investors following the government’s attacks on landlords.

The growing popularity of property crowdfunding is helping prospective buy-to-let investors push back against these attacks, providing a welcome haven for those keen to benefit from a steady stream of secured rental income.

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Rental growth here is 13 times that of London, driven by the growing population of young renters, flocking to the city for studying and career opportunities. Manchester boasts 60% more 25-29 year olds than the UK average, placing it within the country’s fastest growing demand for short term lets.

Massive Investment In Manchester Fuelling Property Market Growth

Success is also compounded by the government’s whopping £7 billion investment in Manchester. Determination to develop a world-class infrastructure in the city will attract further billions of worldwide investment over the coming years, which is already evident as overseas investors hone in on the investment opportunities offered here.  

Over 100,000 students across Manchester’s four main higher education institutions give it the highest student population in Europe.

70,000 of these are not in student halls of residences, meaning they are renting privately within the city. This makes it prime territory for PBSA (Purpose Built Student Accommodation) investment.

Across the board, from the UK-leading purchase market, to the thriving private rental and student markets, right through to commercial investments, Manchester is winning. As growth in the city’s property market continues at an unprecedented pace, with huge investment fuelling projected growth for years to come, we remain confident in the continued promise that our city offers investors.

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Our 2016 Summary

Our 2016 Summary

December saw another successful month for The House Crowd, which rounded the year off nicely for us and allowed us to start 2017 on the right foot. It was a very busy month, with 4 bridging loans being repaid, 1 property sold and seed capital repaid for one of our development projects. We paid out over £2.2 million in capital returned to 693 investors. You’ll find the stats, for December, as well as for our 2016 summary, below:

December 2016

Projects paid out against – 24

Total Value of dividends and interest paid – £195,747.96

Total Value of Capital Repaid – £2,057,295

Total paid out to investors for December – £2,253,042

Total number of investors paid – 693

2016 Final

Project paid out against – 240

Total value of dividends and interest paid – £794,126.60

Total Value of Capital Repaid – £4,554,720

Total number of investors paid – 5,506

Cumulative

Project paid out against – 434

Total value of dividends and interest paid – £1,135,625.00

Total Value of Capital Repaid – £5,005,720.00

Total number of investors paid – 8,498

We’re excited to see where 2017 takes us, and hope that you will join us for the ride. With many upcoming developments and exciting projects to invest in, we’re sure that 2017 is going to be a year to remember.

You can find all our latest investments by clicking here

 

Apache Capital Partners Fund 466 Private Rental Sector Homes in Manchester

Apache Capital Partners Fund 466 Private Rental Sector Homes in Manchester

Property investment management firm, Apache Capital Partners, has teamed with Moda Living to secure senior debt financing of £85m, secured on the Angel Gardens development in Manchester city centre. The development will create 466 private rental sector homes in Manchester.

Deutsche Pfandbriefbank has agreed to a four-year term funding contract for the construction period of the development, which will convert to an investment loan for the rest of the term. The development is set to cost a total of £153m. Completion of the project is set for 2020.

The premium private rental sector apartments will stand 34 storeys tall, making it one of the tallest residential towers built outside London since the 2008 crash. Covering 520,000 sq ft, the Angel Gardens development forms part of the NOMA redevelopment project, regenerating a 20-acre site opposite Manchester’s Victoria station.

Angel Gardens and Beyond…

Angel Gardens, however, is not the only private rental sector delivered by the joint venture between Apache and Moda Living. It will be the first of many private rental sector developments created by the venture. In the pipeline is a total of 5,000 new private rental sector homes across eight cities across the UK, including London and the south east.

Johnny Caddick, managing director at Moda Living, believes the project will “set new expectations for rental housing in Manchester and throughout the UK”.

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Private Rental Sector Homes in Manchester: On Trend

Investing in property in Manchester is becoming a real trend for high profile investors. And the private rental sector is hot property, considering the vast increase in those seeking rental accommodation. It is mainly the young professionals, who are flocking to the city for its huge career opportunities, that make up the bulk of renters in the city. Angel Gardens will be ideally placed for the many employed in the NOMA area, as well as those commuting into Manchester Victoria.

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An Introduction to Investing Through Property Crowdfunding

An Introduction to Investing Through Property Crowdfunding

Traditionally, only those with access to large amounts of capital have been able to invest in the lucrative world of property. Managing a portfolio is normally time-consuming, business, which becomes increasingly more burdensome as the investor’s portfolio becomes larger.

However, in the last few years, a new method of property investment has emerged which has effectively democratised the entire investment process, allowing more people than ever to benefit from the financial gains that property investment can offer.

Property crowdfunding started to take off in 2012, and is now worth billions of dollars a year worldwide. The value of the industry currently doubles every two months, and is set to be worth $250bn by 2020.

The growth of the property crowdfunding industry has been catalysed, in part, by the relaxation of regulations over the last few years. The Government has identified the industry as being hugely beneficial to the economy, and has also begun investing in crowdfunding itself. Institutional investment is also coming into play at an increasing rate, and high net worth investors, attracted by the simplicity of the process, and the returns available, are also investing through property crowdfunding.

But why is investing in property crowdfunding proving so popular?

Offering the chance to build a diverse portfolio without all the legwork involved in traditional property investment models, and with the opportunity for significant gains, it’s no surprise that investing in property crowdfunding has grown exponentially in the last few years.

What’s more, as interest rates on savings continue to crawl along the seabed, and returns from both rental and sales continue to rise, more and more people are waking up to crowdfunding as a simple way to grow their money.

How Does It Work?

Property crowdfunding encompasses both equity investments and debt based investment (also known as peer to peer secured lending).

The concept itself is relatively simple.

Equity investments involve a group of people pooling their cash to buy a property as shareholders through a ‘Special Purpose Vehicle’ (SPV). The SPV is a limited company, set up solely for the purchase of that property. The SPV handles all the work, fees and maintenance of the property, whilst the shareholders receive their proportion of the rental yields, and/or share of capital gains when the property is sold.

People can invest even very small sums in buying shares in the property. On some platforms, this is as low as £50, but the typical minimum is between £500 and £1000. One of the advantages of property crowdfunding is that you can spread your available capital over a number of different properties across the crowdfunding platform, to mitigate risk.

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Getting started is a very quick and easy process. You simply register on your chosen website – it is an FCA requirement that only registered and accredited investors may participate, and, once registered, you simply select the properties you wish to invest in.

Debt based investments again involve pooling resources, in this instance, to make micro loans through the platform to a third party borrower. The loan as a whole is secured against the borrower’s property and the platform appoints an agent to act on behalf of lenders and take any necessary enforcement action. These types of investment are usually short term (up to 12 months, and pay a fixed rate of interest with no capital growth).

Where Did It Start?

The House Crowd is the longest-established property crowdfunding platform. It began trading in 2012 and offers both debt and equity investments. Since then, other companies have followed in their footsteps, such as Property Moose in 2013, and Property Partner and Crowdlords in 2014. The industry continues to expand, with several new platforms emerging each year.

Is It Regulated?

Property crowdfunding firms are all regulated by the Financial Conduct Authority (FCA), which ensures that platforms are managed properly, and that risks are made completely clear to investors. As with any investment, there is risk to capital – but it’s worth comparing this risk against other investment classes, and seeing how property crowdfunding stacks up.

Before investing through property crowdfunding platforms, it is very important to do your research. Every regulated platform should have the FCA authorisation number clearly visible on their website. If you can’t find these details, you should steer clear as they are not operating legally.

Is It The Right Choice For Me?

As with any investment, you need to take into account your personal circumstances to establish whether it is the right one for you.

You can find out more about establishing whether property crowdfunding is the right investment for you here.

Ask yourself what you wish to achieve. Investors with a lot of professional experience and access to bank funding, may find the model less appealing than novices.

If, on the other hand, you don’t have a deposit available, or aren’t able to get a mortgage, then investing through property crowdfunding could be an ideal way for you to access this asset class. And, given the government’s recent attacks on landlords, which has severely undermined the profitability and viability of buy-to-let investing for individual investors, it may well be that crowdfunding remains the only sensible option available for most.

Risk

The same principles that apply to other forms of property investment also apply to crowdfunding. You should be aware that capital growth profits are speculative, and investing in properties that produce a healthy cash flow is the more sensible approach.

One of the major risks associated with cash flow positive properties is that of damage or non-payment of rent. As such, you should always factor this in as an eventuality that may affect your yields. As mentioned above, however, if you have a well-diversified portfolio, with your capital spread over several properties, any losses due to one bad tenant will be more bearable than if you had all your eggs in one basket.

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At the end of the day, it all comes down to your risk tolerance. You do lose a large amount of leverage by investing through property crowdfunding, and you will only benefit proportionately from the property’s capital growth but, at the same time, having no borrowing means significantly less risk as there are no mortgage payments and no danger of the property being repossessed (as shareholders own it outright).

If making crowdfunded debt-based investment, (aka peer to peer lending) you need to know what would happen if the borrower defaults and does not repay the loan. You should ask questions about how your investment would be protected, what happens in the event of a default – how easy is it to take control of the secured property? – and how much equity is available to enable you to recover your money should the worst happen. Unless there is sufficient equity in the property, you could risk losing some or all of your money.

If you opt for debt-based investments, your investment will be secured by a legal charge. A critical matter to consider is at what LTV the loan is made. If, for example, a loan is made at ‘75% LTV’, it means that you will be at risk of losing some of your capital if the borrower defaults, the property has to be seized, and is sold for less than 75% of its current valuation.

Debt investments are generally considered to be lower risk than equity investments, as lenders are always paid out before shareholders, however, you do not get the potential upside of capital growth.

What About If I Want Out of My Investment?

If you need a liquid asset, then property is not the best choice.

Investing through property crowdfunding facilitates liquidity to some degree as it may be easier to sell shares in a property than the whole property. However, there is never any guarantee that you will be able to find a buyer, and, if you cannot do so, you will have to wait until the property is sold.

Some platforms will help you to find a buyer after the expiry of a minimum term, but you should check the small print before you invest. If you’re looking for a short term investment, P2P secured lending may be the better option.

To Conclude

We hope that this has offered you some valuable insight into getting started investing through property crowdfunding. Of course, you should know everything about the ins and outs of any investment before you part with your money, and we are fully committed to helping you know all you need to.

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If you have any questions, you can always get in touch with us and we will be very happy to fill you in.