Blend Network said the predicted decline in housing delivery this year presents an opportunity for peer-to-peer lending platforms to support small- and medium-sized developers.
Recent analysis from property consultancy Knight Frank predicted that 56,000 fewer homes will be delivered this year, a drop of 35 per cent, due to Covid-19 and the subsequent lockdown.
“We believe this opens up an opportunity for experienced small- and medium-sized enterprise (SME) property developers like you, and it also means that P2P property lenders like ourselves will become a key ally in the national housebuilding effort by helping you build the houses the country needs,” Blend Network said in a blog post on its website.
Data from the National House-Building Council shows that only 160,470 homes were built in England from 2017 to 2018.
Blend Network said this shows that the government’s target to build 300,000 new homes a year was not being met before the coronavirus crisis.
It said that this, alongside “an astonishing deterioration in public finances”, will put pressure on the government to consider innovative sources of funding, including P2P property lending, to tackle the housing shortage.
“Boris Johnson’s drive to make housing a priority following his election last year has been welcome news,” Blend Network said in the blog.
“Yet his policies have focused on traditional funding methods, ignoring new, innovative sources of funding such as P2P lending.
“With the number of houses needed being so high and the housing shortage in all likelihood being exacerbated, we believe that all avenues must be explored.”
The platform said this will prove good news for borrowers as it will likely open and broaden new funding channels and help alternative funding to become a greater part of the mainstream funding ecosystem.