8:35 AM, 24th March 2015, About 7 years ago 2
I’m keen to hear other peoples views on crowd funding buy-to-let property. I saw in the news today that one firm had just received over £5m of funding so clearly someone thinks this is a big opportunity. In the question below I have named some firms I know of but please remove these if this breaks any of the forum rules – I have no association with either other than a small investment in one of their properties (total investment is £1,100).
I’m interested in hearing other people’s views on crowdfunding within the property market. I’ve seen a few companies start up over the last couple of years and they appear to be growing quickly, companies such as The House Crowd and Property Partner. They buy the properties through limited companies in the form of SPVs and then sell shares in the SPV so you can invest with a very small capital outlay – as low as £50. They also attempt to create a secondary market, so in theory, you can exit without having to sell the property.
Specifically I’m interested in discussing if fellow landlords would invest into these companies properties. Do these companies exist purely to allow people who would otherwise be unable to invest, either due to capital or skill barriers, “own” a property? Would any current landlords invest in any of their offerings? What else would they need to do to gain your investment?
I don’t want to focus on the individual companies merits but instead focus on the general model they all adopt. I do have a small investment with each (less than £1100 in total) but am otherwise not connected with any of the firms mentioned.