Invest in property loans - the smart way

Target 6.0% p.a. net of fees from a conservative lending portfolio secured against UK property.

Property can provide the opportunity to produce both income and capital growth when the economy is growing, yet it is also capable as a strategy to preserve wealth when there is uncertainty and weakness in the market.

With the advent of new tax and mortgage regulations, accessing returns from buy-to-let and direct property investing is harder than it once was.  However, lending provides an opportunity to earn a passive income from property, with attractive risk-adjusted returns.

 

Why invest in UK property?
Investing in property as part of a balanced investment portfolio can have several benefits:

UK property values have remained resilient during periods of short-term negative performance in the FTSE 100, demonstrating defensive characteristics

Property values can act as a hedge against inflation. Increased inflation, tends to result in higher house prices, although house prices can also increase during periods of low interest rates.

Property can have intrinsic value arising from its necessity – although care must be taken to consider supply and demand balances at the local level  

Property, and its performance as an investment, should be assessed in the context of other options available, based on your financial objectives, risk profile and capacity for loss.

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Is property a good investment?

The UK political and economic climate is expected to remain uncertain over the course of the next couple of years, but there is an established case that the property market can preserve wealth over the medium to long term. 

The UK property market has withstood a continuing volatility in the financial and economic markets over recent years, evidence of its resilience as an asset class.

House prices and real estate transactions have slowed in London and the South-East have slowed recently; however average prices remain on the rise across the country, propelled by regional markets.

A geographically diversified portfolio of property investments can provide a balanced level of performance; in the same way your overall investment portfolio should be diversified.

INVESTING SURPLUS BUSINESS CASH
Property lending with BondMason

BondMason has achieved a stable and steady investment track record from a conservative loan portfolio - with an average LTV of 56% - secured against UK property. 

Property refurbishment finance

Most property loans are used to refurbish property, with the remainder for small-scale developments such as converting a house into a few flats or building a house. 

All projects have planning permission or are completed under permitted development rules.

These types of borrowers operate in niche, higher-margin markets where demand is strong and the investment may be less vulnerable to any potential downturn

Conservative loan-to-value

The average loan-to-value (LTV) of property loans across BondMason is 56%.  

LTV is used to compare the difference between the value of the property and the amount of money being borrowed against it. The higher the ratio of the loan-to-value, the more risky it is for the lender. 

Valuations are independent, typically conducted by professional surveyors adhering to red-book processes.

 

Curated and manually reviewed

The BondMason Investment team reviews every loan, with 1-in-4 loans being approved based on our strict assessment criteria.

We conduct additional due diligence and verify valuations with our own analysis, research and marketability assessments.

In short, we roll up our sleeves and do the leg work to ensure the decisions we make are based on our own insight, backed by years of experience (as opposed to Artificial Intelligence or Big Data).

Loan profile facts and figures
Borrower use of proceeds: Refurbishment
Loan-to-value: 56%
Average term of loan: 6 - 12 months
Geographic diversity: Across the UK
Average loan size: £340k
Data correct as at 9 October 2018

BondMason Clients have achieved an average net return of 6.0% p.a. in every year since 2015 (after fees, losses and cash drag).