Homegrown is an exciting crowdfunding platform, which is offering investors the chance to get into big developments projects without having to stump up huge amounts of cash. Intrigued? Read Homegrown’s guest blog to find out more:
The Deals
The process is that Homegrown, the crowdfunding platform, organises the deal and does all the due diligence on the investment. They then set the amount that they want to raise and put it out to the public to get on board. Having just fully funded its London Fields, Hackney development, it is now raising funds for Rhigos, Abidere, South Wales. The target is to raise £21,000, with projected returns at 33.5%, over a target investment term of 21 months (19.1%pa).
You Can Invest With Only £500
This then gives investors all the fun of investing without really getting involved any more than registering on the website and depositing the investment. Furthermore, investment is accessible to most, with the smallest amount being £500.
Invest Alongside The Pros
Homegrown only works with established developers and on good sized projects (typically with a Gross Development Value (GDV) of between £2m and £50m). In addition to Homegrown’s investment projects are typically funded by the developer and a number of professional and in some cases institutional investors. This means Homegrown’s investors benefit from investing alongside the pros.
Even More Investor Benefits
The benefits to the investor go further. The fact that they only have to deposit a small amount into each property means they can easily diversify their portfolio and spread risk across multiple investments.
The security for the investors is that they become a shareholder in a special purpose vehicle (SPV) company which owns a share of the development. As a shareholder, each investor has the right to vote on key decisions that impact the SPV.
Deal Analysis Throughout The Development
As an investor in the deal, Homegrown will provide you with updates and performance data about how the project is progressing through a personalized deal room on the platform. This provides you with peace of mind that things are ticking over and running to schedule.
Getting Your Returns
The important bit! The investor is notified once the development is complete and any profits are shared out between the investors and the developer.
Simple right? It seems like a bit of a no brainer if you don’t have enough to invest in a property yet, but want a way of increasing your capital! Or you do have enough, but want to diversify your property investment or access property development projects.
Of course, returns aren’t guaranteed. But it is a good way of accessing projected returns above the current low interest rates. Homegrown targets returns of at least 15% per annum on the projects it offers on its platform. Best of all you get to learn from observing how the professional property developers do it.
Disclaimer: Your capital is at risk if you invest in property. Future performance is not guaranteed and is based on projections only. This article is for information purposes only and does not constitute advice in any form.
So what do you think of crowdfunding? Is it something you would be interested in? Let me know in the comments section below. Also, if this has been useful then don’t forget to share it around.
As an offer to my readers Homegrown is offering a free £50 credit when you sign up for an account at Homegrown. Please enter the Referral Code REF2735oqJ (case sensitive) when you sign up. The £50 would be credited into your account and available to use when you make your first investment.
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