Historically, investing in property has largely been confined to either “fixer-uppers” to renovate and flip, or purchasing buy-to-let properties looking for long-term rental income and capital growth.
Thanks to the wonders of the Internet, however, these days serious investors have all manner of ways to make money from property. Furthermore thanks to the Peer-to-Peer industry growing at breakneck speed, not only is it easier than ever before to invest in property but the barriers to entry are far lower than ever before.
Whether you’ve dreamt of starting in property investing but lacked the necessary starting capital, or you’re a seasoned investor looking for ways to diversify your portfolio, there are currently more opportunities than ever before.
Read on to discover some of the most creative ways in which investors and property owners are making money in the property market…
Bridging Loans
Commercial bridging loans provide the necessary short-term finance to cover a property purchase until a mortgage can be arranged. One example of when a bridging loan might be used is when an investor buys a distressed property to transform into buy-to-let properties. The buyer might opt to use a bridging loan to gain ownership of the property and develop it, at which point long-term finance can be sought from their bank.
For obvious reasons in the past there were numerous pitfalls for investors willing to provide bridging finance to property investors, not least the cost of providing such a facility. These days the Peer-to-Peer lending market means that even small investors, frustrated at the poor interest rates offered by many high street banks, can instead invest in bridging loans.
With rates of return up to 6.32% and a minimum investment of just £10, Wellesley & Co. allows you to access this market.
Buy-To-Let
There’s a reason why the phrase “safe as houses” became a common catchphrase. Over the last few decades numerous investors looking for healthy capital growth have become professional landlords. However there are still considerable barriers in the BTL market. For one, most lenders will only offer a 70% LTV buy-to-let mortgage, meaning a considerable deposit is required. On the other hand, there is a growing mound of legislation surrounding a landlord’s obligations.
Once again, however, Peer-to-Peer lending platforms offer an opportunity to dispense with these barriers and potentially to make healthy returns on invested capital.
Websites such as Property Moose allow you to buy a share in a house, which is managed and rented out to tenants on your behalf. You receive your share of the rent at the end of each month and when the property is sold your original investment is returned, together with any growth.
Storage
If you’ve ever tried to rent a storage unit you’ll know how obscenely expensive they can be. At the same time, there are numerous home-owners with garages, spare rooms and lofts that aren’t being accurately used.
Peer-to-Peer websites like Store Mates aim to connect the two groups of people. If you have unused storage space in your home you can turn this into monthly revenue by letting out your excess storage space to others in your neighbourhood.
Parking Places
With ever more cars on Britain’s roads, and parking in public carparks rising ever more in price, the Peer-to-Peer industry has created something of an opportunity. Websites like ParkLet let you rent out your unused drive or allocated parking space to other car owners, in exchange for a regular rental income.
Room Mate
The last way to use Peer-to-Peer networks to make money from property is of course to take in lodgers to rent your spare room(s). There’s no putting postcards in shop windows or paying premium prices for local newspaper advertising.
Instead simply place a listing one of the P2P websites like Spare Room and fill your vacancy at minimal cost.