Open House: April 2017
Welcome to our Open House series. Every month we open the doors on our data to share information about our community, investment performance and measures of liquidity in our Resale market. The series is born of our commitment to data transparency, and we hope you find it useful.
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Since our January 2015 launch, over 9,878 investors have started to build their property portfolio with us.
In that time, investors have invested £51.7m, £37.4m of which is in New Listings, and £13.3m in Resale properties.
Investor portfolio size
Note: Data displayed includes all investors who made an investment on or before 30th April 2017.
Our investors have portfolios ranging significantly in size. 16% of investors have invested more than £5,000 and 52% more than £500. Many have invested much larger amounts, in excess of £100,000. Since investors typically invest regular amounts, those investors that joined Property Partner earlier tend to have invested greater amounts.
Click image to enlarge.
Note: Properties in order of when they were fully funded. Data correct at 30th April 2017.
Investors are coming back again and again, with 74% holding multiple properties with us. New investors represent 5% of all investors across the last 5 properties: 95% of investments in those properties were made by those who had invested with us previously and represent ‘repeat’ business.
Number of properties users have invested in
Note: Includes all investors who made an investment on or before 30th April 2017.
49% of investors have invested in over three properties, and 19% have invested in over ten properties. Diversification is important, as it provides some protection against volatility of returns.
To date, we have never underpaid a dividend.
(Properties highlighted green have exceeded forecasts)
In some cases, we have managed to secure higher rent than originally forecast when the properties were listed on the platform. This will result in higher dividends for investors in these properties.
After the launch of our immediate income feature in December 2016, we have started to include these immediate income payments as dividends in the above sheet, backdating the data to include this information. It is still the case that the dividends sheet tracks only properties that have begun generating rental income, not properties that we have only paid out immediate income cashback for.
As of April 6th 2017, corporate tax rates dropped from 20% to 19%, which increased the tax efficiency of our SPV structure. This increase in efficiency translates directly to an increase in the dividends paid on all of our properties.
In some instances, where properties were acquired vacant, it took us longer to find tenants than anticipated. This was often down to ourselves, as we are highly selective with the tenants we allow to rent our properties, so we chose to fund any such gaps ourselves rather than let this impact dividend payments. Whilst we do not guarantee this practice, we anticipate continuing it for the foreseeable future.
Our properties are carefully selected by our property team, who have a huge depth and variety of experience, and are led by one of the UK’s leading property experts. Together they have a grand total of 68 years, 23,300 units and £1.54 billion experience – and use this to select properties with a view to delivering capital growth as well as rental income. You can read more about our property team here.
All of our properties are independently valued by an RICS qualified Chartered Surveyor at purchase, and through our 3-monthly valuation cycle thereafter. All revaluations occur on the 5th of that month, or the nearest working day thereafter.
Latest Valuation for each property
In grey – HPI based valuations up to June 2016; after June 2016, previous Quarterly Chartered Surveyor desktop valuations. In black – Quarterly Chartered Surveyor desktop valuations.
The above valuations feed into the Latest Share Valuation for each property, after adjusting for purchase costs and other items, and you can download an Excel tracker of the historic share price movements here. The Excel tracker is updated monthly and will allow you to track the performance of each individual property. This data will be integrated into the platform in the months to come.
The Resale market
Property Partner investors can withdraw capital by offering their investment for sale at any time, or they can exit at market value after five years. (Read more about 5-yearly mechanics here). Investors can also bid for property shares on the Resale market, to let sellers know the price they’re willing to pay. Learn more about this, here.
Here we share key measures of the Resale market, including time to sell, trading volumes, and a download of trading activity allowing you to perform your own analysis. This includes key metrics from the Bid Engine.
To date, 95% of all secondary trading has taken place at a premium to the property’s Initial ‘New Listing’ Price. Shares offered for sale at a discount to the New Listing price had an average time to sell of 5 days and 19 hours.
The time to sell shares at a premium to the New Listing price, but at a discount to the Latest Share Valuation is impacted by investors exploiting the opportunity to cash in short term gains. Shares that were sold at a premium to ‘New Listing’ price and discount to Latest Share Valuation took 17 days and 2 hours to sell on average.
Trading volumes have been meaningful: 38.03% of the total property portfolio has traded in the Resale market. This figure varies substantially by property, with ‘older’ properties (those funded many months ago) generally seeing more trading volume than more recent properties, since they have had a longer time in which to trade. Our first property has been 162% traded on the Resale market already (i.e. over 1,620,000 of its 1,000,000 shares have traded in the Resale market)
The property-by-property data is below, in order of property launch (with the earliest launched properties at the top of the table):
Through the Bid Engine, 1,313 investors have placed bids so far. To date we have seen 8,310 resale transactions matched by bids, amounting to a total of £1,923,491. On average these trades have been at a 3.75% premium to initial listing price.
Currently, the Resale market has 2,849 outstanding bids, equating to £1,624,607. Of these, £351,099 can be matched, as bidders can place the maximum available funds they have across multiple properties. (The first bids to match will complete, and the rest will be cancelled, or reduced, accordingly.)
We have also prepared a full download of Resale trading activity, including all transactions matched through bids, which you can access here. This spreadsheet allows you to review trading by property, including the trade date, trade price, premium to Initial Valuation, and premium to Latest Share Valuation.
Since our January 2015 launch, Property Partner has helped over 9,878 investors to build their personal property portfolios. Our properties have consistently delivered rental incomes at or above forecast, in addition to attractive capital gains.
We have already seen 38.03% of property shares traded on the Resale market, and for our first-funded property, 162% of the shares have been traded. The length of time taken to sell shares in the Resale market varies according to the price at which shares are offered.
We will continue to share information and data, to give investors like you a clear view on our performance. And for those of you who are not yet investors, we hope that this data will help you make an informed decision as to whether you would like to join us.
And as always, you can view our latest opportunities for investment by clicking below:
If you would like to provide any comments on this article, or offer your time for a call to provide general feedback, please call us on +44 (0)20 3696 5600 or drop us an email on firstname.lastname@example.org
We’d love to speak with you.