Firms pile into property crowd-funding market

PropertyMoose – a crowdfunding website that allows individuals to pool investment in property allowing individuals to spend smaller sums than usual – is to relaunch in the middle of next month.

Set up by James Cadbury, part of the chocolate-empire family, it has so far reportedly attracted a modest 70 investors allowing them to buy a share in a house or apartment for as little as £500.

New investment opportunities are temporarily unavailable prior to the site relaunch.

Investors enjoy income from rent: PropertyMoose promises a potential six per cent return. Investors could also ultimately receive capital appreciation earned prior to sale – the site promises 70 per cent of appreciation will go to crowdfunders.

When it relaunches the website will include a link with a not-for-profit property renovation service which will operate as a charity, assisting young women who have been the subject of domestic abuse or people trafficking.

Meanwhile CrowdProperty has been launched as a new peer-to-peer lending platform designed to facilitate loans between private individuals and property professionals.

CrowdProperty says it is aimed at two different groups of people. Firstly the ‘lender’; private individuals with £500 or more seeking to achieve returns of five to 11 per cent gross. Secondly ‘borrowers’ or property professionals, that wish to borrow money from the crowd of lenders to finance a new property project or re-finance an existing one. This includes development projects, project refinancing and buy-to-let investment refinancing.

CrowdProperty takes a one-off three to five per cent arrangement fee from property professionals and passes the full amount of the gross interest payable on the loan to the crowd of private individuals. Borrowers can apply for up to 100 per cent finance on new developments at between nine and 11 per cent per year, or up to 80 per cent loan to value for refinancing at five to six per cent per year.