The Angel Of The North – Gateshead
How It Works
- You join as an investor HERE to become a member of the Crowd2Let community and be able to view comprehensive reports on available Crowd2Let properties.
- You add any amount you choose, in multiples of £500, to your account using your secure Personal Portfolio Dashboard. This can be done by either a simple debit card transaction or an online bank transfer. Your funds are held securely in a stand alone, “ring fenced” client account with Mango Pay.
- You see a Crowd2Let property investment package similar to EXAMPLE 4 on our INVESTMENT EXAMPLES page. The total package price is £90,000 and you decide to invest £1,000 from your account in that particular property deal.
- To keep the maths simple we will assume that another 89 investors also contribute £1,000 to the crowdfund to fully fund the property at £90,000, in reality individual investment amounts vary in multiples of £500.
- Crowd2Let forms an SPV, Special Purpose Vehicle, in the form of a limited company named after the address of the property and 180 shares are issued within the company. Each investor within our example is issued with a share certificate for 2 shares, ie their £1,000 investment as each share is worth £500.
- The company proceeds to purchase the property through our solicitors Nicholson Martin Legge & Miller and completion swiftly takes place.
- On completion the purchase price is transferred to the vendor. The agreed fee remains with our solicitors to pay for their services plus disbursements. The remainder is transferred to Crowd2Let Capital Ltd to pay our fee of 5% of the property purchase price, to pay for the insurance policy and to fund the refurbishment/lettings preparation programme. All of these amounts are clearly outlined in the initial Crowd2Let property report.
- Crowd2Let begin to prepare the property for letting. The objective is to have all works finished within 2 weeks of the completion of the purchase of the property. If little or no refurbishment work is required to the particular property this 2 week period will be considerably shorter.
- Our dedicated letting agent will then find a suitable tenant who has been fully referenced.
- When the property is ready the tenant moves in after signing the tenancy agreement. All properties are let on an Assured Shorthold Tenancy for a minimum of 6 months. The aim is that the property will be tenanted no more than 4 weeks from the date of completion of the purchase of the property, although this time frame could be considerably shorter.
- Each Landlord is paid rent in proportion to their share ownership in the property as described in EXAMPLE 4 on our INVESTMENT EXAMPLES page.
- Every Crowd2Let investment has an Investment Time Frame, usually 1 – 5 years, shown on the initial report. This is the length of time the asset will be held by the company until it is put on the market for sale.
- When the property is sold the proportion in relation to each investors ownership is paid to them net of disbursements and in this way the investor receives his initial investment back plus his proportion of the capital growth. In EXAMPLE 4 on our INVESTMENT EXAMPLES page this is the £1,000 initial investment plus £544 capital growth or £1,544 in total.
- Once the sale is complete and all funds have been disbursed the SPV is closed, the company is dissolved and your funds are returned as a final dividend.
Notes:- Examples for illustration purposes only. Actual package prices and achievable rents will vary from property to property. As with any investment yields and capital values can go down as well as up. The property may take some time to let and void periods may occur. Crowd2Let do not guarantee rental incomes or post refurbishment values in any way and ongoing maintenance costs may be incurred in the future. Income tax and capital gains tax may be payable. Crowd2Let are not financial advisors. We act as an agent sourcing, maintaining, letting and managing residential properties on behalf of investor clients. Please read our full risk warnings HERE before registering as an investor.