Mike Bristow, chief executive of CrowdProperty, explains why his platform is sticking to what it does best: quality property lending
‘AS A COUNTRY, WE are not building enough homes,” says Mike Bristow, chief executive of property-backed peer-to-peer lending platform CrowdProperty. “We built our platform because we could see that there was pain in that market.”
Bristow is right when he says that there is a housing shortage in the UK. According to a government white paper released in 2017, the country needs to be building 300,000 new homes every year. In reality, only around half of this target is being met. While this is bad news for first-time buyers, it represents a huge opportunity for P2P property lenders and investors alike.
Demand for housing is only going to grow as the population increases, and there is a finite amount of land which is suitable for development. According to Bristow, a lot of this viable land is in the hands of small- and medium-sized enterprise (SME) property developers who just need speed and certainty of funding to get their projects off the ground. And he would know; CrowdProperty was founded by experienced property investors and developers who saw an opportunity for change.
“For many years, we experienced huge frustrations with traditional funding markets,” says Bristow. “We found all of these markets to be slow and cumbersome, and attitudes from traditional lenders towards SME property professionals were just not good enough. We felt there had to be a solution.”
The solution was CrowdProperty. Established in 2013, it has been quietly building up a reputation for being a reliable and knowledgeable platform which only offers high-quality loans to its lenders.
When CrowdProperty listed its first loan in September 2014, it took 10 weeks to fund. Earlier this year, a project worth £456,000 was funded in 47 seconds.
“Building a trusted brand takes years, and everything we do has to enhance that trust,” explains Bristow. “Our current success is all a function of four-and-a-half years of hard work building our systems, our processes, and our track record. It’s about leveraging our expertise, making good lending choices and curating good projects, then offering those on our platform.”
In a competitive marketplace, CrowdProperty has created an enviable track record with no losses, no late loans and a 100 per cent capital and interest payback track record for both.
This is primarily down to the platform’s property expertise, says Bristow, as well as a responsible attitude towards risk and security, and building great relationships with lenders and borrowers.
“Offering a better deal to borrowers means that we can be very competitive on rates with traditional lenders,” says Bristow. “That is the purpose of our strategy because that means we are lender of first resort, not a lender of last resort.”
CrowdProperty’s long-term strategy is clearly paying off. The platform has achieved that rare feat of offering something valuable for both borrowers and lenders, while also supporting much needed house-building projects across the UK. This winning strategy is not going to change any time soon.
“We’re focused on what we do and we’re getting better and better every day,” says Bristow. “You don’t see Tiger Woods playing much tennis – we believe competitive advantage comes from doing the same thing better and better every day. And that’s what we do.”