July update on my real estate crowdfunding portfolio (Update 7)
I have a small real estate crowdfunding portfolio that I keep track of every month. It’s separated from my p2p lending portfolio primarily because these are not quite p2p investments. My investments here are in platforms that focus on 2 types of investments: buy-to-sell and rental properties.
I’ve started to keep track of this portfolio since January. You can see my previous month portfolio here.
Highlights of my July portfolio updates:
- I’ve invested in 2 new platforms: Brickstarter and Yielders
- moved 100 EUR out of Reinvest24 because of a cancelled investment
- most of my investments in Property Partner moved out of pending state, while Property Partner decided to increase fees
Below is an overview of my real estate crowdfunding portfolio. It’s worth now about 3650 EUR.
|Platform||Invested capital||Current value||Profit||Currency|
|Housers||599||604 (+1)||5 (+1)||EUR|
|Reinvest24||498 (-101)||491 (-97)||-7 (+4)||EUR|
|Brickstarter||50 (+50)||50 (+50)||0||EUR|
|Property Partner||1196||1216 (+5)||20 (+6)||GBP|
|British Pearl||600||619 (+1)||19 (+1)||GBP|
|Brickowner||300||306 (+3)||6 (+3)||GBP|
|Yielders||200 (+200)||200 (+200)||0||GBP|
Legend: The numbers in the parentheses signify the increase /decrease since last month.
I’ve earned this month 16 EUR out of the 3500 EUR I had invested at the beginning of the month. That’s around 0.45% return, although monthly return doesn’t mean much in these types of investments. Many of the investments in this portfolio will return something only when they’re sold.
I’ve invested some small amounts in 2 new platforms. If all goes well, I’ll increase my investments in them.
I’ve had my Housers account for a while to invest in Spanish real estate, but lately, I came to the conclusion that this platform is not exactly what I’m looking for.
And then I found Brickstarter. A small Spanish crowdfunding platform, with only 12 properties so far in its portfolio. I’ve written some notes about them here if you’re interested to learn more about them.
They only focus on vacation rentals in Spain (Airbnb, Booking), and their investor base is quite small. They only recently translated their platform into English, most likely in search from investors outside Spain.
I’ve invested 50 EUR into the only property that was in funding, a 1 bedroom apartment in Seville. They plan to renovate it and put it up for sale. While it waits for a buyer, it will be listed for rental on Airbnb.
I like that they pay a 5% interest for my investment while it waits for the property to be funded, so I’m earning money from the first day I invested in it.
Property Partner decided to give investors the gift of extra fees this month, making investments there a lot less attractive. I started to think it’s a good time to look for alternatives.
While I also have some investments in British Pearl, the platform is still small and with only a few properties in their portfolio. So, I needed to search for a new platform.
Yielders are running a crowdfunding campaign on Seedrs, and they managed to catch my interest. They also have high fees (2.5% buy fee, 10% fee on rental income and 15% of the profit when the property is sold). But their net rental dividends range between 6% to 8%, so they offer a better deal than Property Partner right now.
I’ve only invested 200 GBP in 2 properties that are still in funding, with a rental yield of 7% per year.
They only have 2500 investors right now, but the property seems to be funding relatively quick.
My small piece of British Empire
Calling it an empire is obviously an exaggeration, but we all have to start from somewhere.
I’ve received another 2.69 GBP dividend from my investment in Great George Street, Liverpool. The bonds on this property pay interest quarterly, so this was expected. It’s the only property that pays interest, the second one will only pay at the end of the investment term (36 months), while the third one is still in funding and it won’t pay interim interest either.
The new property I’ve invested in last month is still in the funding phase and reached now 35% (from around 10% last month). Meanwhile, Brickowner started a new crowdfunding campaign on Seedrs and they almost reached their limit.
British Pearl pays their monthly rental dividends as usual, and I’ve received my monthly 1.6 GBP dividends.
Their biggest problem is that they still fail to attract new investors, so they can’t yet expand their portfolio and add new properties.
Property Partner recently changed their CEO and they decided to ditch their smaller investors. They didn’t do this directly, ut added a bunch of fees that make it hard for investors to invest small sums.
For one, they added a 1 GBP monthly fee for everybody that invested on the platform. They also added a 1% annual fee on assets under management, taken out from the monthly rental dividends payments.
Combined with the recently lowered valuations on lots of properties and diminished rental returns, they did a great job this month and convinced investors this month to withdraw more than 1 million GBP from Property Partner.
One interesting thing they added was a “property portfolio central fund”, a sort of provision fund to cover for unexpected events that would affect rental returns on some of the apartments. This means that if something happens (e.g. tenants leave or damage the house), the dividend is still paid from the provision fund. Then the property will lower its dividend so it can pay back the unforeseen expenses over the next 6 months. This fund will bring more stability for those that expect a certain monthly income from rental dividends.
My investment in the “opportunistic fund” didn’t work as expected. Out of the 250 GBP invested, they took 75 GBP and gave me back the rest. For the 75 GBP currently invested, I’m expected to receive around 10% annual return in the next 18 months. Given that I’ve kept my funds there for 5 months, since February, with no interest payment, this was not a good investment for me.
Property Partner gathered 2.1 million GBP and returned back 1.5 million GBP to its investors. They also took a 50% LTV mortgage on the 1 property they acquired. A bit risky.
One of the properties I’ve invested in cancelled during due diligence because of lack of energy performance classification and the owner didn’t want to pay for it.I’ve reinvested the funds in the secondary market.
I’ve received this month only 1.6 GBP in rental dividends, but my next month’s expected dividends are 4.72 GBP.
I still have 75 GBP locked in a funded property that’s still in a pending state. When that investment will be finalized, I should expect a full 5 GBP per month rental dividends.
This is of course before the 1% annual fee on my investments (1 GBP) and before the 1 GBP monthly fee.
I’ll need to decide soon if I need to move out of Property Partner or invest more to make the fees worth it.
My Spanish dominion
I’ve added Brickstarter to my Housers investments, so hopefully, I can see more changes from now on.
Not much changed on Housers this month.
I gained 1 EUR in interest payments from the 4 development projects I’m invested in. 2 other development loans are still in funding since last month.
Half of my Housers funds are invested in buy to sell properties with no monthly payments. So I won’t see any returns for these until they’re sold.
Meanwhile, Housers continue their cashback campaigns, with 2% cashback on most of their open investments. This looks great, although in reality they just lowered the 10% interest rates they offered before to 8%, and now they offer the rest as a 2% cashback. Kind of a shitty move, to be honest.
One nice thing they added is that projects will earn a 10% annual interest for the period they’re in funding phase. This means investors will start earning interest from the moment they invest and they don’t need to wait for the project to be funded in order to receive interest payments. You can read more about this on their blog.
If you want to try Housers, you can use my referral link and earn an extra 50 EUR cashback when you invest 50 EUR in one of their projects.
My Baltics enclave
I’m only invested in Reinvest24 for now, and this month I’ve reduced my investment with 100 EUR.
Reinvest24 failed to fund a property in time and the investment cancelled. I had 200 EUR invested in that property, so I invested 100 EUR in a new rental property and retrieved the remaining 100 EUR. The new property is still in funding, so I don’t know if this will get cancelled as well or not.
I earned so far 2.46 EUR dividends from 2 of the rental properties I’ve invested in. I like that they send monthly updates to investors on each property: how much it earned, what were the costs, what commissions they took and how much the investors receive. I’m pleasantly surprised by this.
That’s all for this month. See you next time.