Perhaps unsurprisingly, LendInvest sees itself and other platforms like it as the answer to the UK’s housing crisis.
The leading property lending marketplace has this morning published a new report entitled Putting Finance First: the alternative route to funding Britain’s SME housebuilders. The report focuses on how government can better support small and medium-sized housebuilders; LendInvest claims that the number of SME firms in this market has fallen by 80 per cent since the last housebuilding boom.
The solution posited by the report is to forge closer ties between existing government funding schemes and alternative lenders.
Homes England should deploy its £2.5bn Home Building Fund by providing funding lines to alternative lenders, argues the report. Meanwhile, local authorities should emphasise co-investment with alternative lenders in local developments, utilising the Public Works Loan Board to funnel discounted capital to SME housebuilders. Finally, the British Business Bank must step up its game, appointing more non-bank lenders to its ENABLE Guarantee programme, thus underwriting more property investment and development loans.
LendInvest specialises in bridging loans, development finance and buy-to-let mortgages. It funds its loans via a range of mechanisms – recently adding retail bonds into the mix.
“The government is clearly trying to get more homes built across the UK. However the government needs to work with alternative lenders, like LendInvest, to help get critical funding to SME housebuilders,” said LendInvest co-founder and CEO Christian Faes (pictured). “Our proposals offer common sense solutions to a major market crisis, using tools that government already has at its disposal.”
Mark Prisk MP, former housing minister, authored a foreword to the report. “What is required, as this report emphasises, is a combined effort by government and private partners to ensure small builders have access to the finance they need, to help affect the change,” he said.