LendInvest, a peer to peer mortgage lender, states it has helped to add over 1200 properties to the UK housing stock since the beginning of 2015. This is almost double the figure year prior. LendInvest is now the 4th largest P2P lender in the UK. LendInvest says this constitutes 1% of total privately build homes in the UK market. Housing in the UK is currently undergoing a demand / supply imbalance causing prices to rise. The lending platform provides a needed service for landlords and developers to help “plug the funding gap”, left by high street banks.
“The massive shortage of new housing is pushing up house prices across the country. The crisis we are encountering is born out of simple supply vs demand economics, the result of which is that owning a house is out of reach of much of today’s younger generation,” explains Christian Faes, Co-Founder & CEO of LendInvest. “Creating new housing goes directly towards addressing this issue, and LendInvest is proud to be part of the solution to the housing market in the UK.”
LendInvest reports that despite its younger funding base, the platform is competing with the UK’s major house builders on their ability to provide sufficient numbers of new properties to the market every year. LendInvest can approve loans Supply for up to 36 months within days. This is far faster than a typical bank.
In the past year, LendInvest has lent over £250 million to borrowers. A typical LendInvest developer borrows from £500,000 to £5 million and creates 1 to 15 units of housing. He will be an experienced property professional whose developments are his primary source of income. The majority of LendInvest-backed properties are two or three-bed houses, sold for £100,000 upwards.
“After only 30 months in business, LendInvest will supply essential financial backing for around 1% of all privately developed homes in the UK this year,” states Faes. “In a market where there are a dozen house hunters for every property and major house builders don’t intend necessarily to increase the number of units they built year on year, the country urgently needs housing stock from alternative sources. Every housing development is underpinned by access to finance. Without the funds, builders cannot build. Where the cost of capital restricts the banks, alternative lenders must fill the void.”
The company expects the total valuation of properties funded to date to exceed £1 billion by early 2016 and expects to fund more than 1,500 new properties in 2016. A total of 1222 units have been financed in 2015. In 2014, the total stood at 663 units.
LendInvest says it is the largest P2P platform for property globally. The company recently recorded its second annual profit of £3.1 million after only two years’ trading. During the past two years LendInvest has originated almost £430 million in loans.