The Trouble With Banks and Mortgages

The trouble with banks (or one of the many troubles with banks when it comes to property investment) is that they put on a smiley face when they want your business, but have no qualms about riding roughshod over you when it suits them.

Thousands of property investor borrowers with the Bank of Ireland found this out to their cost yesterday, when they saw their tracker rate mortgages double overnight.

Rates for buy-to-let and some residential customers who are currently paying 2.25% will rise to BBR plus 4.49% in May. Many regard this as showing a blatant disregard for their customers.

The Trouble With Banks and Small Print

According to a letter sent to the bank’s customers, the loan agreement has a special condition (no doubt hidden in the small print no one reads) which allows them to change the tracker differential for a number of valid reasons.

Many mortgage agreements also (unbeknownst to many borrowers) have clauses allowing the bank to call in the loan at any time subject to certain conditions.

Avoid Trouble With Banks With Property Crowdfunding

It’s for reasons like this that we at The House Crowd wanted to create a different wholly transparent business model for property investment enabling both us and our investors to profit without being at the mercy of banks.

Free from the bind of bank finance and mortgages, investors in property crowdfunding can avoid trouble with banks. With as little as £1,000 they can own a share in property, benefit from potentially high returns, and put in significantly less than were they to invest in a whole property themselves.

The transparency and honesty of property crowdfunding platforms like The House Crowd are key reasons why people are slowly moving away from traditional property investment models, where there is so much risk from unscrupulous banks and mortgage lenders.

Whilst there is risk associated with any form of property investment, we believe it’s more straightforward to weather those risks with the crowdfunding model.

If you want to find out more about avoiding trouble with banks and instead exploring the new property crowdfunding model, we can help. Simply register on our site for more information about getting started, with no demands to do so straightaway.

Register Now for more Info

You can also view our current property investment opportunities by clicking below:

View our Property Investments

Home ownership, marriage or children?

Rather eye-catchingly, a recent Barratt Home Buyers study has found that individuals looking to buy a home consider this a greater priority in life than marriage or starting a family.

Whilst we consider this ‘study’ a rather sensationalist promotional tool, biased by the fact that survey recipients were home hunters quizzed by a housing company, it is perhaps worth considering what changes might be taking place in public perceptions as well-documented struggles for home ownership continue without an end in sight.

You only want what you can’t have, is a phrase that we believe can be applied to the aforementioned eye-catching statistic from the study. Demand for homeownership has risen perceptibly in young people over the last couple of years, as it has become more of a luxury than the attainable milestone it used to be. A decade ago it took 25 months on average to save a deposit for a new home, whereas it now takes a staggering 64 months , resulting in first time buyer numbers plummeting by 64% in 10 years.

The UK’s economic situation remains challenging and the principles of supply and demand matter now just as much as they ever have. Buying a first home is fast becoming a privilege attained only by a minority, and with this, public perceptions of owning a home may well be transforming and taking on a greater importance.

The House Crowd offers an alternative solution for first-time buyers struggling to raise a deposit for their first home. For as little as £1000, our crowdfunding property investment model provides a minimum annual return of 6%, in addition to a share of house sale profits – ideal for growing your deposit in order to take your first step onto the property ladder.

The House Crowd is a brand new concept in property investment which allows people to invest small amounts via crowdfunding (for more information on the process, visit www.http://thehousecrowd.com/thehousecrowd//how-it-works/). We are committed to breathing life into empty, rundown properties whilst giving investors great returns on their investments (for more information about us, visit www.http://thehousecrowd.com/thehousecrowd//about/our-manifesto/). If you’ve read enough and want to invest now, visit www.http://thehousecrowd.com/thehousecrowd//invest-in-property/).

Ethical Crowdfunding Success as ‘The House Crowd’ Raises £1 Million

We’re delighted to share the news that we’ve now surpassed £1 million of crowdfunded property investment in The House Crowd.

With Britain facing an affordable housing crisis comparable to that of the early post-war years, we are pleased to be doing our bit as an innovative property investment company, alongside our investors, to support Communities Minister Don Foster’s campaign to revitalise the estimated 1 million empty homes in Britain.

So far, forgotten communities in parts of Oldham, Farnworth and Little Hulton have already benefited from our efforts to revive distressed properties, where quality housing has been provided at fair prices to those most in need.

Our ‘caring capitalism ethos is something which sets us apart from other property investment companies and we are pleased to see property investors join our ethical crowdfunding revolution, to the tune of £1 million. Onwards and upwards!

The House Crowd is a brand new concept in property investment which allows people to invest small amounts via crowdfunding (for more information on the process, visit www.http://thehousecrowd.com/thehousecrowd//how-it-works/). We are committed to breathing life into empty, rundown properties whilst giving investors great returns on their investments (for more information about us, visit www.http://thehousecrowd.com/thehousecrowd//about/our-manifesto/). If you’ve read enough and want to invest now, visit www.http://thehousecrowd.com/thehousecrowd//invest-in-property/).

FSA gives green light to online crowdfunding platform

The Financial Services Authority (FSA) has for the first time approved a crowdfunding website facilitating direct investment in small businesses. It means investors using the website, Crowdcube, will now be able to claim compensation from the Financial Services Compensation Scheme and access the Financial Ombudsman Service if they have a complaint.

The opinion here at The House Crowd is that it’s good to see a regulator starting to approve dynamic forms of financing like crowdfunding. As demonstrated by our unique business model, crowdfunding can provide great returns for all, in a safe, transparent way.

Currently, as The House Crowd doesn’t fall under the definition of either a CIS (Collective Investment Schemes) or OEIC (Open Ended Investment Companies), we do not require the FSA’s authorisation to operate.  However, even though we are not FSA regulated, we do everything we can to ensure that all our dealings are as transparent as possible and that investors are made fully aware of the risks as well as the rewards in any investment. We also ensure your money is protected as far as possible – you never pay money directly to us, all investment monies are paid to a solicitor’s client account and held there until the property is purchased and your shares are issued.

The House Crowd is a brand new concept in property investment which allows people to invest small amounts via crowdfunding (for more information on the process, visit www.http://thehousecrowd.com/thehousecrowd//how-it-works/). We are committed to breathing life into empty, rundown properties whilst giving investors great returns on their investments (for more information about us, visit www.http://thehousecrowd.com/thehousecrowd//about/our-manifesto/). If you’ve read enough and want to invest now, visit www.http://thehousecrowd.com/thehousecrowd//invest-in-property/).

Cash For Communities Building New Homes

Cash For Communities Building New Homes

Planning Minister, Nick Boles, has signalled an intention to direct up to £650,000 to councils that allow the development of new homes on their unused land. The money will be provided to local authorities by house builders once they receive planning permission for building new homes.

Mr Boles hopes this innovative proposal might help tackle the UK’s growing housing shortage crisis.

As part of the scheme, local people could stand to receive up to 25 per cent of the money for the improvement and provision of local infrastructure, if plans are supported via a local referendum.

Whilst it’s good to see the Government coming up with new ways to stimulate housing development, our concern with this scheme is that the imposition of an increased tax on house builders might drive up the price of land, thus affecting the provision of less expensive, affordable homes.

At The House Crowd, we think it vital that with an apparent renewed focus on building new homes, the Communities Minister’s pledge to ensure that 5,000 empty homes be refurbished to tackle the national housing shortage are not put on the backburner.

About Property Crowdfunding – Building New Homes for Britain’s Future

Property crowdfunding is now taking the investment world by storm, following our brave debut onto the scene in 2012. We were the first (and continue to be the best) platform for property crowdfunding.

We are proud to offer better returns on investment than many other investment models, and allow people previously locked out of the property market to benefit from the lucrative world of property investment. What’s more, we’re helping the UK with building new homes across the Greater Manchester area.

For more information on the process of getting involved with property crowdfunding, visit our Crowdfunding Process page.

We are committed to breathing life into empty, rundown properties whilst giving investors great returns on their investments.

To find out more about getting great returns on investment with The House Crowd, start by getting to know us here.

The Kitchen Deal Breaker

Many people dream of installing a new kitchen, complete with granite worktops, an island unit and an AGA cooker, but how many people know the true value of making sure your kitchen is up to scratch?

Those in the know often say that a kitchen is the deal breaker room when selling a house, it can literally make or break a sale. It is therefore worth carefully planning any kitchen upgrades you undertake. Here are The House Crowd’s top tips to help you get it right:

-          People are too quick to gut their entire kitchen, often they’ll end up refitting units in exactly the same place. This is because the initial design of the kitchen is likely to be the most practical design. Take time to consider what your new layout would be, will it work?  What do you not like about the practical design of your current kitchen, and how can you solve those problems with your new kitchen?

-          Instead of spending a lot of money replacing everything, why not consider quick-fixes? Modernising unit doors and relaying the floor can save a lot of time and money. Large DIY stores have a good range of upgrade solutions and materials.

-          A common complaint people have is a lack of worktop space. Think about how you can make what you have go further, as unless you’re extending a kitchen, a re-design won’t necessarily give you more space. Solutions like microwave brackets, floating shelves, and flat-folding hinged tables can provide more workable space; there are also amazing new space saving idea available with new kitchens, including pull out work tops that can be put away when not in use.

The House Crowd is a brand new concept in property investment which allows people to invest small amounts via crowdfunding (for more information on the process, visit www.http://thehousecrowd.com/thehousecrowd//how-it-works/). We are committed to breathing life into empty, rundown properties whilst giving investors great returns on their investments (for more information about us, visit www.http://thehousecrowd.com/thehousecrowd//about/our-manifesto/). If you’ve read enough and want to invest now, visit www.http://thehousecrowd.com/thehousecrowd//invest-in-property/).

Property Investment Predictions For 2013

The Royal Institute Of Chartered Surveyors (RICS) have made positive property investment predictions,  forecasting that UK house prices will rise 2% during 2013 and rents will increase by 4% on average.

It also forecasts a rise in the number of property sales. It estimates that there will have been 930,000 property transactions in 2012, and this will increase to 960,000 in 2013.

RICS is also predicting that the number of repossessions should fall to under 35,000 – the lowest figure in 6 years. Simon Rubinsohn, RICS’s chief economist, said: “The average house price in the UK looks set to rise by a further 2% next year, despite the uncertain outlook for the economy.

“More positively, the amount of property sales going through should also see an increase across the country, climbing to its best level since 2007, as the Funding for Lending scheme helps boost the availability of mortgage finance.

“But these tentative signs of recovery in the sales market should not blind us to the very real problems that still exist. Even with the Funding for Lending scheme and some other government policies beginning to be felt in the mortgage market, many first-time buyers will continue to find it difficult to secure a sufficiently large loan to take an initial step on to the housing market.

“Meanwhile, the alternative of renting is becoming more and more costly, with a further increase in rents likely in 2013. Critically, the Government needs to ensure that the conditions are in place that will enable the stock of new housing, whether for purchase or rent, to rise more rapidly.”

The House Crowd view: if these property investment predictions are correct, it should make it easier to sell our refurb/sell projects, though we still believe it will be fairly tough for first time buyers to get a mortgage and it will continue to take a while to find buyers.

It bodes well for our long term buy and hold strategy that the shortage in housing will continue, pushing up rental demand and to some extent rents.

Although we recognise there are limits to what people can afford to pay and we know from the Council Landlord Forums we attend, that LHA rates in Salford /Manchester will only rise by about 1% next year, but as you know we typically achieve 11% yields and have plenty of margin to pay the 6% guaranteed yield.

There is now such stiff competition in the market for investment properties in the £45-£55k price bracket, that we operate in, that we cannot see how prices could fall further. If anything they will probably rise slightly in 2013.

Property investing still perceived as a winner in 2013

So how do people perceive the future of property investing in these interesting times?

The two most important factors for people investing in property in 2013, according to a recent survey, are a stable income and a boost to insufficient pension provision.

“Landlord Today” also reported that confidence in the UK market is robust, with ¾ of property investors stating they intend to buy additional buy to let properties over the next 12 months, as low savings rates and returns on the stock market means property investment compares very favourably with income from other investments.

Many involved in property investing  are taking a long-term view, with 65% stating that rental income for retirement is their main motivation, followed by long-term capital growth (27%).  Just 8% of respondents cited short-term capital growth as their reason for investing. 68% of people surveyed claimed they are achieving gross rental yields of at least 6%, but only 20% achieving 9% yields or higher.

Only 5% felt that property prices have further to fall.  We suspect they have all been spending too much time reading The Daily Mail.

Peer-to-Peer Property Funding

With peer-to-peer lending, individuals provide unsecured loans to those in need of finance, rather than saving their money in a bank or building society. Though quite a recent phenomenon in the UK, peer-to-peer lending is predicted to continue to grow rapidly, especially as the reputations of our high street banks continue to be damaged by seemingly unremitting revelations of malpractice.

Peer-to-peer lending websites, such as Zopa, Yes-secure and Ratesetter have already achieved significant success, with more than £200m estimated to have been lent through Zopa since its inception in 2005.

Whilst peer-to-peer lending has the benefit of cutting out money-grabbing middlemen, the risk of reintermediation is becoming an increasingly likely problem. As peer-to-peer lending companies grow, their marketing, regulatory and operational costs increase, which could potentially cause companies such as Zopa, Yes-secure and Ratesetter to lose the benefits which currently sets them apart from traditional banks.

Despite recent Government support, only time will tell whether peer-to-peer lending will become a norm of borrowing and lending in the UK. Here at The House Crowd, we support the practice of peer-to-peer lending, but would remind those lending their funds that with us you can get a very good return on your money and need do nothing at all!

The House Crowd is a brand new concept in property investment which allows people to invest small amounts via crowdfunding (for more information on the process, visit www.http://thehousecrowd.com/thehousecrowd//how-it-works/). We are committed to breathing life into empty, rundown properties whilst giving investors great returns on their investments (for more information about us, visit www.http://thehousecrowd.com/thehousecrowd//about/our-manifesto/). If you’ve read enough and want to invest now, visit www.http://thehousecrowd.com/thehousecrowd//invest-in-property/).

Tips for a novice property investor

Taking your first steps into property investment can be an incredibly daunting process, which is why we’ve outlined some key property investor tips for novices to follow.

The obligatory legal particulars can seem convoluted, the amount of time it takes for a return puts off many and the risk of losing your life savings is frightening. However, if done properly with the right preparation, getting into property investment can be a relatively straightforward and exciting adventure.

Here are The House Crowd’s key property investor tips to help you make your first forays into property investment a success:

-          It is important to understand that property investment is a business, not a hobby. You need to be prepared for long hours of research, negotiation and, sometimes, disappointment. Going it alone can provide fantastic returns for some, but only those with a committed business mentality.

-          Property investment is truly a long-term investment and accepting that there may be times when your outlay exceeds your investment income is part and parcel of the process. Be prepared for unforeseen circumstances, such as property repairs, which can affect the time it takes to see decent returns.

-          Beginning your adventure with a small project is advisable. It’s easy to get carried away if you fall in love with a property (remember, you won’t be living there, this is business!) and bite off more than you can chew without knowing if you’re cut out for property investment. There will be plenty of opportunities for tackling big projects once you have gained some experience – though you, like many, may learn that smaller projects can actually offer better rewards!

Remember, with The House Crowd you get a very good return on your money and need do nothing at all. You have no mortgage payments, no bills, no void periods, no tenant problems, no maintenance or repair issues to worry about. And, of course, you can spread your money over as many different properties as you like rather than putting all of your eggs in one basket!

The House Crowd is a brand new concept in property investment which allows people to invest small amounts via crowdfunding (for more information on the process, visit www.http://thehousecrowd.com/thehousecrowd//how-it-works/). We are committed to breathing life into empty, rundown properties whilst giving investors great returns on their investments (for more information about us, visit www.http://thehousecrowd.com/thehousecrowd//about/our-manifesto/). If you’ve read enough and want to invest now, visit www.http://thehousecrowd.com/thehousecrowd//invest-in-property/).