littleoldlady
Member of DD Central
Running down all platforms due to age
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Post by littleoldlady on Jun 13, 2017 12:34:04 GMT
IMO residential property at <70% LTV is pretty safe. Valuations are much more accurate and easy to check. Borrowers who are also occupants are less likely to take risks. There is a chronic shortage of housing so a major slump in prices is unlikely. Still some risk, but justifiable in the 6%-7% range I feel. Still need some DD to identify reckless borrowing on development projects.
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macq
Member of DD Central
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Post by macq on Jun 13, 2017 14:59:58 GMT
while at some point a correction in the housing market is expected or due depending on the expert opinion its the way its handled by P2P which would be interesting.There are many property investment funds that lost 30% or more in the last financial crisis but made it back and more in the last 5 years while still paying a yield of 4%-5% because they could sit on their assets and had time on their side.And are still held by pension companies as a bedrock for their funds.
If a loan defaults now on a P2P platform the market is good and demand is high and most companies only have one or two to sort out,may not be so easy in a crash to get people their money back.The platforms in residential have an edge in that most people will try to pay or they will hope to renegotiate so a company like Landbay will run on an historical basis based on the the mortgage market since the war(but still no guarantee).
Am not an expert on building development but do know that in 2007 - 2008 in my part of London there were more then a few sites that came to a stop for a couple of years or more and relations in Dublin still talk of new estates that were being built that just lay ideal waiting years for someone to take them on again.So may not be a quick fix for some more exotic loans in a crisis.
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