factornerd

A short review on Yielders property crowdfunding platform

Yielders is a real estate crowdfunding platform from the UK that focuses on buy-to-let properties from London and South East England. Since its launch in 2016, it managed to found properties worth more than 2.5 million GBP, with an average net yield of 6%.

Published:  Tuesday, 29 December 2020
Author:  Daniel
Launched:
2016
Headquarters:
UK
Investors:
~2500
Investors from:
Global, no US
Investments Funded:
2.5 million GBP
Investment Types:
Rental properties
Investment Countries:
UK
Investment Terms:
3 to 5 years
Expected Returns:
6% to 10%
Minimum Investment:
100 GBP
Currencies:
GBP
Early Exit:
secondary market

How Yielders works

Yielders finds properties available on the market, evaluates, buys them, and then secures a rental agreement for a minimum of 2 years. The acquired properties are managed by separate SPVs (special purpose vehicle), limited companies separated from Yielders that will manage the property. After this, it publishes the properties on the website and investors can buy shares in them. The minimum investment is 100 GBP.

Since the properties are already bought, the investors will receive rental payment the next month after they invested. All rental payments are paid on the 1st of every month.

The typical investment horizon is 3-5 years. At the end of the investment term, Yielders looks for a buyer, sells the property, and then distributes the capital gains to its investors.

Fees

Yielders makes money by charging different fees along the process. When you buy shares in a property, a 2.5% SPV administration fee is charged out of your investment. Additionally, a 10% fee is charged every month from the gross rental yield of the property. When the property is sold, Yielders also takes a 15% cut of the capital gains from the property.Even with all the high fees, the average rental yield of the properties is 6%, so it’s still a good deal. It also helps that Yielders buys properties debt-free, so they don’t need to use part of the rental income to pay for loan interest payments.

Early exit

This is the part I don’t like about Yielders. They do have a secondary market where you can sell your shares to other investors if you want to exit earlier from your investment. However, they charge a 50 GBP fee for listing your shares on the market. A 50 GBP fee is not a friendly fee for small-time investors.

Becoming a Yielders investor

There are currently more than 2500 investors on the platform. While it’s focusing more on UK investors, they accept investors from all over the world (except US residents).

The registration process is relatively simple: provide an email address, passport copy and proof of address, bank statement and you’re done.

You can invest either as an individual or as a private company in their properties.

Platform experience

The website looks really nice, although it’s a bit slow. The front page shows you the available properties, with net rental yields displayed and full rental return until the end of the investment term.

I like that each property has enough details to help you make an informed decision. If you want to invest in a property, you’ll first have to at least download the available documentation before the invest button is activated.

As a nice perk, they also show you on the property page a nice investment calculator, showing the expected rental return.On my portfolio page, I can see the list of my investments and I can also publish them on the secondary market if I want to sell them. However, the 50 GBP fee on each rental property prevents me from doing that.

Summary on Yielders

I believe Yielders is a good option for people wanting to invest small amounts in the UK real estate market.

Pros:

Cons:

Want to learn more about Yielders?

Check out their website

A short review on Brickstarter

Brickstarter is the place to go if you want to invest in Spanish vacation rental properties. This real estate crowdfunding platform buys tourist rental properties, renovates them and then sells them back at an increased value.

Read More

Reinvest24 review. Is it a good platform to invest in?

Reinvest24 is one of the newest players on the real estate crowdfunding landscape in Estonia.

Read More

Brickowner property investment platform review

Brickowner is a relatively new property crowd-investing platform in the UK. With just 100 GBP, it lets you own a portion of property investment in the UK.

Read More