MILLENNIALS MOST LIKELY TO INVEST IN PROPERTY CROWDFUNDING

MILLENNIALS MOST LIKELY TO INVEST IN PROPERTY CROWDFUNDING

 

  • Millennials make up 54% of people investing small amounts in property crowdfunding
  • People aged 18-30 outstrip all other age groups for using online investment websites
  • Top reasons for investing include wanting to start a property portfolio, using inheritance money and saving for a house deposit

 

Millennials are more likely than any other age group to invest in property crowdfunding, casting doubt on assumptions that 20-somethings have too little disposable income to save or invest – or else spend their finances on avocados.

 

Findings show that over half (54 per cent) of people who invest in property crowdfunding are aged 18-30, according to property crowdfunder UOWN.

 

This outstrips any other age group, compared to only 25 per cent of people 31-45 and 15 percent of those aged 46-60. The smallest cohort is those aged 60+ who make up just six per cent of investors.

 

Some young investors also see crowdfunding as a stepping stone to becoming property developers in future, according to investor interviews by UOWN. Other reasons given by millennial investors include saving for a deposit for a house or a rainy day and wanting to use inheritance money in a productive way.

 

The start-up analysed information of 300 investors and found that 160 investors were aged 30 or younger.

 

UOWN property crowdfunding case study #1

 

Gillian, 25, Leeds

 

Gillian, 25, UOWN investor

 

Gillian is a PhD student in bioenergy at Leeds University and a snowboarder with Team GB. She invested £1,000 in property crowdfunding through UOWN.

She says: “At the start of summer I received some extra money through an inheritance and I wanted to use the money in the way that my dad would want me to. So I decided to get into property.

“I’ve been trying to manage my finances better and I knew that bricks and mortar is the safest investment. With property crowdfunding I get six per cent returns and can see the money coming in every month. It’s just the best way of generating interest.

“It was really user friendly and easy to understand – you can see pictures of the houses and floor plans.

“The fact that the property doesn’t have to be fully funded for you to get returns is quite unique.

“I’ve completed a property course and I’m in the process of buying a three-bed house share in West Yorkshire which will give me about £800 cashflow a month.”

 

UOWN property crowdfunding case study #5

 

Joe, UOWN investor

 

Joe, 19, Leeds

Joe is a jazz musician studying at Leeds College of Music. He invested £465 in property crowdfunding through UOWN.

He says: “I’m currently saving up for a vintage saxophone from the 1930s, which will cost a fair few thousand pounds, so I want any investments that can help me towards that.

“I had savings accounts in banks before, so this was the first time I looked into investing. It wasn’t something I was considering before.

“I first heard about property crowdfunding because the company was offering to send a chilli plant to your friends. Over a few weeks I looked into it more and liked the idea of bringing property investment to everyone.

“When I had a bit of money spare I decided to invest in the properties and, when I saw the returns, I invested some more afterwards.”

 

UOWN director Shaan Ahmed said: “A lot of people will be surprised that millennials are so active in investing, but young people continue to break stereotypes around finances and savings.

 

“More than any other age group young people are seeking out alternative investments, and property crowdfunding is a simple way for them to reap the financial rewards of a property portfolio.

 

“For digital natives the idea of using a property crowdfunding website just makes sense – you can see all the financials, select your properties and even invest using your debit card or by direct debit. The whole process takes one or two minutes.”

 

Property crowdfunding is a relatively new form of investing which allows tens or hundreds of investors to buy a share in a house. They then get back their proportion of rental income and any increase in the house’s value. It is often seen as an easy alternative to buy-to-let, giving investors returns without the hassle of being a landlord.

 

UOWN is the first property crowdfunder to offer previously off-market properties which have returned strong yields for more than 10 years, through its sister company Parklane Group. The start-up pays returns to investors from their first month, even before the house is fully-funded.

 

UOWN’s first fully-funded property – a four-bedroom semi-detached house in Leeds – racked up an impressive £189,000 from 92 investors, with an average contribution of £2,000.

 

The Leeds-based company was launched earlier this year by brothers Shaan, 26, and Haaris Ahmed, 23.

 

According to UOWN’s forecasts, an investment of only £1,000 today could give an investor £226 in rent and £307 in house price increases over five years – an overall return of £1,532 and a 53% increase on the investment.

 

Investing in property puts your capital at risk, and returns are not guaranteed. UOWN is an appointed representative of ShareIn, which is authorised and regulated by the Financial Conduct Authority.

 

For more information, visit uown. co

 

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