Open House: May 2016
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 7,647 investors have started to build their property portfolio with us.
In that time, investors have invested £33.2m, £26.5m of which is in New Listings, and £6.7m in Resale properties.
Investor portfolio size
Note: Data displayed includes all investors who made an investment before 5th June 2016.
Our investors have portfolios ranging significantly in size. 15% of investors have invested more than £5,000 and 47% 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 to enlarge.
Note: Properties in order of when they were fully funded. Data correct at 5th June 2016.
Investors are coming back again and again, with 71% holding multiple properties with us. New investors represent 13% of all investors across the last 5 properties: 87% 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 before 5th June 2016.
43% of investors have invested in over three properties, and 14% have invested in over ten properties. Diversification is important, as it provides some protection against volatility of returns.
We have met – or exceeded – forecast dividend payments on all properties to date.
(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.
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 88 years, 28,800 units and £1.79 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 also every 3 months thereafter to provide a valuation update for that individual property. All revaluations occur on the 5th of the month, or the nearest working day thereafter.
Latest Valuation for each property
N.B: The revaluations of this month will be delayed from June 6th to July 5th.
We’ve been notified by the Land Registry that its House Price Index (HPI), along with the HPI published by the Office for National Statistics, will be replaced by a single UK Index from this month. As a result, the publication of HPI data for April 2016 will be delayed, along with our own revaluations. The data shown for ‘Latest Valuations’ has therefore not been updated. Revaluations will happen July 5th, and the data will be published with our next Open House post.
We’re also going to take this opportunity to simplify the current system, whereby some properties have their quarterly independent RICS Chartered Surveyors’ valuations on different dates to others. We will transition all of our properties to a standardised, quarter-end RICS revaluation cycle. This process will begin immediately, with a portfolio-wide revaluation of all our properties taking place in June and being published on July 5th. Find out more about these changes, here.
In grey – HPI based 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).
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.
To date, 98% 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 4 days and 10 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 6 days and 6 hours to sell on average.
Trading volumes have been meaningful: 25% 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 128% traded on the Resale market already (i.e. over 1,280,000 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):
We have also prepared a full download of Resale trading activity 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 launch, Property Partner has helped over 7,647 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 25% of property shares traded on the Resale market, and for our first-funded property, 128% 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 email@example.com
We’d love to speak with you.