A new Lincolnshire-based online investment platform is accepting registrations from investors seeking a unique opportunity to invest in property developments through crowdfunding.
Called Build Backer (www.buildbacker.com) it gives investors the ability to invest directly in a property development project alongside a developer so they can enjoy the high returns and asset security associated with traditional property investing, without the high capital outlay, expensive professional fees or time.
Visitors to the website will be able to see the complete website, find out about the company and learn all about the advantages of property development for both investors and developers seeking to raise funds for their property development projects.
Build Backer founder Tom Ladds said: "Once on the site potential investors will be able to register their details to receive a free guide to property development crowdfunding. To celebrate the forthcoming launch of Build Backer, ‘early birds' who register on the platform now will also be the first to know when Build Backer is fully live, giving them access to an exclusive campaign offering a higher than average return and first charge security.
"In addition, fundraisers will get first mover advantage and can begin fundraising straight away while affiliates can begin introducing developers to the platform and begin generating their own revenue immediately, even while we're still in the pre-launch stage."
For developers Build Backer represents a serious alternative to traditional sources of financing for their projects. The Build Backer model gives them control of their loan. Developers can decide how much they need to borrow, for how long, on what repayment terms and at what rate of interest.
In the first instance, the platform and the opportunities it offers to investors are open to high net worth individuals and sophisticated and experienced investors. Users of the platform have to confirm this before they can access the website and view campaigns. It is hoped that in the near future the platform will opened up to all classes of investors including retail investors.
For fundraisers, Build Backer crowdfunding provides access to a large capital resource without being reliant on just one, or a few, investors as they are with traditional financing models.
"Fundraisers can access the finance they need on terms which are more suitable for them so they can remain in control of their own developments. This is the power of crowdfunding," said Ladds.
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Comments
It's of no concern to me that crowdfunding is becoming so popular within property. It would seem that if crowdfunding is best suited to anything it’s to property developments, both for the developer and potential investors.
By nature a ‘sophisticated investor’ should be able to properly understand and evaluate the risks of an investment, whether they’ve invested in property before or not. Ultimately, it’s the same for all investments, if you don’t fully understand it, it’s always best to seek advice from a professional who does.
Crowd funding is great for specific sectors. But I am concerned that far too many of these "crowd funding" sites in property are starting to take hold.
I am not convinced that your average "sophisticated" investor will have a clue about property development (in fact I guarantee most will not!). Those of us that do and have been involved for many years know only too well the issues involved.
I can see vast numbers of greedy investors chasing "massive" profits all ending up getting involved in development deals that frankly they will not have a clue about. When interest rates start going up many of these property based crowd funding sites are likely to very quickly find themselves in deep trouble.