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How 126 Investors Bought This £212,900 Property – In 35 Minutes

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Investors clubbing together to buy property to let is a growing trend with a number of crowdfunding websites offering variations on the theme. There is clearly appetite. One site, Property Partner, which launched five months ago, has already raised £3.5m and spent it on 12 properties in and around London. The latest deal – a two-bed flat in Byfleet, Surrey – was listed on the site yesterday. The hoped-for yield on the property is 6.55pc. http://www.telegraph.co.uk/finance/personalfinance/investing/11622843/How-126-investors-bought-this-212900-property-in-35-minutes.html

How to blow great bubbles.

Method 1 of 3: Blowing a Basic Bubble

Method 2 of 3: Blowing a Huge Bubble

Method 3 of 3: Blowing Trick Bubbles

Edited by rollover

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Ha....so they are relying on peoples future income/wages to pay their high yield investment....if property was such a one way gamble why would high income earners be renting not buying?.....is this an alternative payday loan co?

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How can I list my crappy buy-to-let property on one of these sites?

The question on every buy-to-let fraudsters' lips.

Note to Fergus Wilson and Ajay Ahuja :

Gentlemen, start your engines!!!

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It's because we don't have the space (or the money) like the Chinese to build ghost cities. We're just playing on a different level.

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It's because we don't have the space (or the money) like the Chinese to build ghost cities. We're just playing on a different level.

This deserves more attention/consideration than it will probably get in this thread!

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If these ***** did this about 2 years ago you would have to admit (even if it was pure luck) - they would have done well.

Then again - just how do you agree between 126 folk to sell the thing to release any profit ? Or do you just sell your stake for its 'worth' today ?

Massively risky.

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Then again - just how do you agree between 126 folk to sell the thing to release any profit ? Or do you just sell your stake for its 'worth' today ?

They're set up as shares in a company - so to sell your stake you 'simply' sell your share to someone else. A bit like how you'd sell your share of a listed company, but without the scrutiny - a bit like a timeshare, or selling your park-home. I could imagine the shares will be very liquid up to the point in time that the value of the underlying asset starts to drop, at which point they will become illiquid and more or less worthless. I can also imagine that there will be additional costs (beyond the 12.5% + vat (ie 15%) management fee) invented at some point... At the five year point there will be a formal opportunity to exit at market rates, but only if someone wants to buy at those market rates (ie, completely useless as it is the same as putting up your share at any other point at 'market rates') - if no-one wants to buy then they simply sell the property (it is not clear what happens if there is a majority that want to stay invested but the small minority can't sell their stake at the 5 year point). Of course, if they can't sell the shares at market rates then it might simply be because there is little interest in such investments, which might be because at that point in the market there is no interest in letted property investments - so perhaps the simple sale of the underlying asset might take a considerable time. And it goes on.

This is a nice simple investment so long as everything is fine and dandy. At the point in time where things are not fine and dandy this becomes a crazy investment.

I wonder what will happen?

Anyway, the investment reappraisal point is 5 years from now - so I imagine that by 5 years time there will be lawsuits.

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Cheers for the info.

So lots of people splitting up an investment in residential property - most using debt no doubt - hoping it just rises forever.

Sure I have heard of something similar before :)

Edited by ccc

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Does the law require that these operations be regulated by one of the regulatory bodies, and if not why not?

(They're basically converting the property into a limited company, aren't they, so that should come under company regulations, am I getting warm? Or an OEIC? or just a REIT?)

And i BET it doesn't comply.

Edited by Si1

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This seems like a sure thing!

Anyone in for a new startup? - a crowdfunding platform to buy tulips?

Fancy going halves on a tulip bulb?

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Does the law require that these operations be regulated by one of the regulatory bodies, and if not why not?

(They're basically converting the property into a limited company, aren't they, so that should come under company regulations, am I getting warm? Or an OEIC? or just a REIT?)

And i BET it doesn't comply.

I think they think it is a crowdfunding investment - nice and simple, pretty much unregulated, nearly all risk on investor. But it looks a bit like a collective investment scheme that should come under the FCA rules. I imagine that this is one of the aspects that the lawsuits will be arguing about in 5 years time.

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My guess view is the investors likely already own their own homes. Outright in many instances. Like Timak's parents-in-law going into BTL.... their main home (worth fortunes), life a dream, but not happy their 'several hundred thousands pounds' in the bank was only getting <1%. Perhaps less extreme than that, but similar.

Telegraph story http://www.telegraph.co.uk/finance/personalfinance/investing/11622843/How-126-investors-bought-this-212900-property-in-35-minutes.html

From the property partner website, for the house (2 bed flat actually) pictured in Telegraph article

This is an unusual transaction, and plays to our collective strength as a cash buyer - with the added benefit of deep market knowledge.

It’s a leasehold property where the building’s freeholder (an investor) is going through bankruptcy proceedings. The resolution is ultimately a simple one: the freehold title will likely be sold by the administrator, who is acting on behalf of a bank.

However, administrative proceedings involving a bank can be drawn out and take several years. In the meantime, no one can secure a mortgage to buy any of the leasehold properties in that block.

Owing principally to this, we were able to negotiate a 20% discount relative to the RICS certified Vacant Possession value – paying £204,540 instead of £255,000. We expect investors to later benefit from the uplift in value, in addition to an enhanced rental yield provided by the capital discount.

...We have adopted a rent forecast of £1,200 per month, in line with the Estimated Rental Value advised by local letting agents. We have allowed two weeks from completion in which to find tenants, and intend to start marketing the property before completion.

more more https://propertypartner.co/properties/UKKT147RX001#/UKKT147RX001

more pics https://propertypartner.co/properties/UKKT147RX001#/photos/UKKT147RX001

Here's what 'appears' to be a recent RM listing for it... it looks like a solid match, before it went to auction... hmmm.... and then I look at the above. I can't scrutinise every picture atm (tired / putting off deadline work).

Guide Price* £200,000. http://www.rightmove.co.uk/property-for-sale/property-34166946.html

SOLD BY AUCTION-14 APRIL 2015.

Found the auction listing/details, and result. (Only 5 lots went through that auction)

April Auction Results
Auction Date: Tuesday, 14 April 2015

http://www.auctionhouse.uk.net/auction/results/32

Result: Sold after auction for an undisclosed amount

Previous Sold Price from Rightmove/LR data.

Flat 6, High Court, 135 High Road, Byfleet, West Byfleet, Surrey KT14 7RX£215,000 	Flat, Leasehold 	25 Jan 2007 	£219,950 	Flat, Leasehold  	09 Apr 2003 	 

(Local Authority: Woking Borough Council). Wonder how they're doing with that shopping centre they bought out.

Nothing on sales market for that postcode.

A studio and a 2 bed flat (in same building looks like, but a different house) on rental market - rental asking prices stronger than I expected would be for that area.

http://www.rightmove.co.uk/property-to-rent/find.html?locationIdentifier=POSTCODE^3606626

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I think they think it is a crowdfunding investment - nice and simple, pretty much unregulated, nearly all risk on investor. But it looks a bit like a collective investment scheme that should come under the FCA rules. I imagine that this is one of the aspects that the lawsuits will be arguing about in 5 years time.

I don't care what it is. Crowdfunding if they've structured it correctly, as it appears some have, other if not... they're still pushing and falling over themselves to invest in property.

Well I hope I'm not still waiting for hpc opportunity by then, listening to the sale 'victim' stories, and excuses 'didn't know what they were doing', campaigning for bailouts, like 2008+ and now house prices here 30% above 2007 peak (except £1m top end where some weakness). And that any lawsuits prove to be as 'crowdfunding' like the West Brom case for whatever it was per property for the BTLers (although waiting upon if they get permission to appeal or not).

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A couple of unrelated points:

-Haven't researched it, but I'm sure there will be many management and maintenance fees to pay

-In the South Sea Bubble, when buying and individual share became too expensive I believe syndicates were set up to buy shares, there was then a bubble in the syndicate shares

I'm sure this time it's different ;)

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A couple of unrelated points:

-Haven't researched it, but I'm sure there will be many management and maintenance fees to pay

-In the South Sea Bubble, when buying and individual share became too expensive I believe syndicates were set up to buy shares, there was then a bubble in the syndicate shares

I'm sure this time it's different ;)

Omg

Hadn't thought of that. The price of the shares could trade at a premium to the underlying asset...

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...We have adopted a rent forecast of £1,200 per month, in line with the Estimated Rental Value advised by local letting agents. We have allowed two weeks from completion in which to find tenants, and intend to start marketing the property before completion.

Now on rental market; a match for me.

http://www.rightmove.co.uk/property-to-rent/property-52351280.html

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Here's what 'appears' to be a recent RM listing for it... it looks like a solid match, before it went to auction... hmmm.... and then I look at the above. I can't scrutinise every picture atm (tired / putting off deadline work).

Guide Price* £200,000. http://www.rightmove...y-34166946.html

SOLD BY AUCTION-14 APRIL 2015.

Found the auction listing/details, and result. (Only 5 lots went through that auction)

April Auction Results

Auction Date: Tuesday, 14 April 2015

http://www.auctionho...tion/results/32

Result: Sold after auction for an undisclosed amount

Previous Sold Price from Rightmove/LR data.

Flat 6, High Court, 135 High Road, Byfleet, West Byfleet, Surrey KT14 7RX

£215,000 Flat, Leasehold 25 Jan 2007

£219,950 Flat, Leasehold 09 Apr 2003

(Local Authority: Woking Borough Council). Wonder how they're doing with that shopping centre they bought out.

Looks like flat 4 and 5 heading to auction (that postcode - at a glance it looks like same building). Get in there crowdfunders lol, or core voter BTL Daddies, if you've got any money left for the glory of property and capturing Generation Rent. The money never runs out. Or does it? Maybe not now, but soon, imo.

4 http://www.rightmove.co.uk/property-for-sale/property-52837984.html

5 http://www.rightmove.co.uk/property-for-sale/property-52837987.html

http://www.rightmove.co.uk/house-prices/KT14-7RX.html

#132

#133

http://www.auction.co.uk/residential/onlineCatalogue.asp

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