MANY peer-to-peer investors have already placed more than 10 per cent of their investible assets in the sector ahead of new regulations coming in next week.
From 9 December, P2P lenders will only be able to market their products to sophisticated or high-net worth clients or those who only invest 10 per cent of their investible assets.
But research by P2P lender Fitzrovia Finance has revealed that individual investors who already use online property investment platforms have an average of £39,178 invested through them, which makes up around 30.2 per cent of their entire savings and investment portfolios.
The platform surveyed 311 retail investors who have used property investment platforms and found 70 per cent have more than £20,000 invested through them, with 31 per cent having more than £50,000.
Three quarters claim that they have more than 10 per cent of their savings and investments invested through property investment platforms. Only eight per cent said that they had less than five per cent invested through these sites.
The platform suggested the high level of exposure here could in part be explained by the fact that they expect high returns from their investments.
“The new guidance from the Financial Conduct Authority (FCA) has been implemented to discourage individual investors from being over exposed to property investment platforms,” Brad Bauman, chief executive of Fitzrovia Finance, said.
“For sophisticated investors, the opportunities available through our and other secured property debt platforms provide a great choice to diversify their portfolios and improve returns on their investments in a low interest environment and given a volatile stock market.
“However, we recommend that investments should be spread across a number of platforms and they should only make up part of your overall portfolio – certainly no more than 10 per cent.”