P2P investors pine for property exposure

By Guglielmo de Stefano on Monday 16 November 2015

Alternative Lending

According to Crowdstacker, retail investors want to enhance their exposure to the UK property market by means other than direct property purchase.


According to research conducted online by ICM research on behalf of Crowdstacker – a peer-to-peer lending platform focused on business loans in the UK – almost half (44%) of retail investors would like to increase their exposure to the UK property market, not only owning their home, but also in other ways, such as investing through peer-to-peer lenders.


The UK real estate market is red hot at the moment and investors seem to be interested in it for various reasons. 62% of them are looking at the long-term growth of the UK property market; 59% are attracted by strong levels of rental income; 50% are convinced that house prices will keep rising in the near future.


Apart from this strong interest, investors are reluctant to invest directly in the real estate market for several reasons. 36% of them are worried about the risks involved in managing properties; 30% are deterred by high transaction costs and by the risks that prices might fall; 28% reports lack of time to concretely manage bricks and mortar properties; 25% claims that affording either a deposit or a second mortgage would be impossible.


Crowdstacker offers investors alternative ways to invest in the UK real estate market. The platform is currently offering investors the opportunity to lend to Amicus Finance Plc, a specialist lender offering short-term loans secured against UK property, SME lending and working capital solutions.


Karteek Patel, CEO of Crowdstacker, commented:


"Investors are provided with an exciting opportunity to receive a market beating return by sharing in its success.  Its short-term mortgages are secured on UK property at an historic average 'Loan to Value' (LTV) of 60% and Amicus ensures that it has personal guarantees from directors.  We believe it has an extremely low default rate and therefore can offer investors a high degree of security."


Launched last June, Crowdstacker is currently targeting medium size companies, rather than small ones, since it believes that they represent a secure investment proposition and yet remain chronically underserved by the banks. Aside from the Amicus opportunity, the platform has also listed a loan for Quanta Group – a privately owned company that buys, refurbishes and sells residential properties in the UK. People investing through Quanta Group will earn a 6.8% annual return over a period of 3 years and may invest a minimum amount of £700.


All investment opportunities are carefully selected by the platform itself through a thorough due diligence process, focusing on a company’s financial health, security, and management team.

Sign up for our newsletters

Your daily 7am download of all things alternative finance and fintech.

Fintech and alternative finance headlines with an exclusive Editor's Note each week. Delivered Monday at midday.

AltFi's new weekly US newsletter breaking down the ins and outs of America's burgeoning fintech sector. Delivered Monday 9am EST/ 6am PST.