A new poll by peer-to-peer lending platform Assetz Capital has revealed a shift away from traditional ‘bricks and mortar’ property investing, and towards alternative property investments.
70 per cent of Assetz’ current investors told the platform that they don’t hold bricks and mortar property investments, while 91 per cent said they haven’t held a bricks and mortar investment in the past five years.
Meanwhile, 83 per cent of investors said that they plan on maintaining or increasing their level of investment in alternative real estate opportunities such as property P2P platforms over the next 12 months.
54 per cent of Assetz Capital’s investors are looking to increase the size of their overall investment portfolio next year, while 33 per cent plan to keep their portfolio at the same level.
The data suggested that investors are becoming more interested in seeking out opportunities to make their money work harder in response to the ongoing low interest rate environment and the rising cost of living,
More than two thirds (67 per cent) of Assetz investors said that the main reason for their investment was the potential for a better return.
16 per cent of Assetz investors said that their primary reason for investing was to provide alternative ways fund their retirement.
When asked why they are planning on increasing their levels of investment in alternative real estate opportunities, 56 per cent of Assetz investors said that they were looking for better returns on their money, while 31 per cent said they wanted to diversify their investment portfolios.
“As it stands, the current financial system is broken,” said Stuart Law, chief executive of the Assetz Group, said.
“Savers may struggle to get a fair return on their deposits, while businesses can’t get the funding they need to grow. At the same time, there aren’t enough homes in the right places at the right prices. In line with investor appetite for more alternative real estate opportunities and a more convenient, hassle-free way to invest, our focus is on continuing to innovate.
“As a group, we are providing tech-driven platforms to allow private investors to support funding or ownership of higher yielding real estate schemes. This provides total flexibility to directly choose and manage a diverse portfolio of property backed investments, with far less stress than a typical and directly held buy to let property.”
Law predicted that alternative property investing will represent the future for real estate investing as it meets the needs of the modern investor, while providing more bespoke finance solutions for essential, yet underfunded market sectors.