zlb
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Post by zlb on Jan 15, 2020 11:00:20 GMT
Can property developers simply be divided between those who self-fund and those who don't? Are larger companies lent to by banks? Who are these people?
I've often seen comments on property p2p platforms about the borrowers being the least trustworthy as they are either too inexperienced and therefore unreliable; or at the far end of the spectrum of dodgy behaviour, didn't have any intention of paying a p2p loan back.
Would a bank have lent to a borrower project which ended up with student halls which didn't pass building regulations for fire safety? If not, then which platforms might this sort of error get missed on by that platform's DD?
What about valuations - was Ly the outlier in their wrong valuations combined with borrower behaviours?
I see RICs valuations still cited as a secure and trustworthy point in property development. Why would that be posed as reliable these days?
Is it simply a matter that if a developer can't borrow from a bank that means that they are dodgy on the Venn diagram of borrowers?
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registerme
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Post by registerme on Jan 15, 2020 12:29:07 GMT
See this thread. Banks don't lend at 70% GDV where the developer has no skin in the game. |
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ozboy
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Mine's a Large One! (Snigger, snigger .......)
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Post by ozboy on Jan 15, 2020 13:39:19 GMT
Can property developers simply be divided between those who self-fund and those who don't? Are larger companies lent to by banks? Who are these people? I've often seen comments on property p2p platforms about the borrowers being the least trustworthy as they are either too inexperienced and therefore unreliable; or at the far end of the spectrum of dodgy behaviour, didn't have any intention of paying a p2p loan back. Would a bank have lent to a borrower project which ended up with student halls which didn't pass building regulations for fire safety? If not, then which platforms might this sort of error get missed on by that platforms DD? What about valuations - was Ly the outlier in their wrong valuations combined with borrower behaviours?I see RICs valuations still cited as a secure and trustworthy point in property development.Is it simply a matter that if a developer can't borrow from a bank that means that they are dodgy on the Venn diagram of borrowers? Oh Dear. 
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dead-money
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Post by dead-money on Jan 15, 2020 13:54:34 GMT
"Can property developers simply be divided between those who self-fund and those who don't? Are larger companies lent to by banks? Who are these people?"Nope, hardly any large company would self-fund growth. It would involve tying up too much capital. They can issue new shares, launch commercial bonds and secure loans, overdrafts, trade credit, etc. at competitive rates. Barratt homes, the UK largest new house builder has ~ £1 Bn of debt (£700m overdraft, £200m credit notes, plus Land & Trade Creditors ) and paid ~£30m in interest last year. www.barrattdevelopments.co.uk/~/media/Files/B/Barratt-Developments/reports-presentation/2019/barratt-ar19.pdf
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michaelc
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Post by michaelc on Jan 15, 2020 14:21:57 GMT
Can property developers simply be divided between those who self-fund and those who don't? Are larger companies lent to by banks? Who are these people? I've often seen comments on property p2p platforms about the borrowers being the least trustworthy as they are either too inexperienced and therefore unreliable; or at the far end of the spectrum of dodgy behaviour, didn't have any intention of paying a p2p loan back. Would a bank have lent to a borrower project which ended up with student halls which didn't pass building regulations for fire safety? If not, then which platforms might this sort of error get missed on by that platforms DD? What about valuations - was Ly the outlier in their wrong valuations combined with borrower behaviours?I see RICs valuations still cited as a secure and trustworthy point in property development.Is it simply a matter that if a developer can't borrow from a bank that means that they are dodgy on the Venn diagram of borrowers? Oh Dear. I didn't read that as the OP agreeing with those statements. Just provoking discussion. I suspect most on the board know the answers.
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ozboy
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Post by ozboy on Jan 15, 2020 16:29:51 GMT
Yerright, it's frightening that there may still be some out there who are unawares. Not referring to you zlb.  |
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zlb
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Post by zlb on Jan 15, 2020 17:46:12 GMT
Yerright, it's frightening that there may still be some out there who are unawares. Not referring to you zlb. so lendy weren't an outlier in over valued projects? CP are quoting RICs valuations ...
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zlb
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Post by zlb on Jan 15, 2020 17:46:33 GMT
See this thread. Banks don't lend at 70% GDV where the developer has no skin in the game. thank you
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KoR_Wraith
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Post by KoR_Wraith on Jan 15, 2020 17:59:33 GMT
Yerright, it's frightening that there may still be some out there who are unawares. Not referring to you zlb. so lendy weren't an outlier in over valued projects? CP are quoting RICS valuations ... All Lendy valuations were RICS valuations.
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zlb
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Post by zlb on Jan 16, 2020 16:52:14 GMT
so lendy weren't an outlier in over valued projects? CP are quoting RICS valuations ... All Lendy valuations were RICS valuations. I know, that's my point - if they used them, why are CP promoting it as a factor that is reliable...
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KoR_Wraith
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Post by KoR_Wraith on Jan 16, 2020 17:16:21 GMT
All Lendy valuations were RICS valuations. I know, that's my point - if they used them, why are CP promoting it as a factor that is reliable... To give customers a false sense of security it would seem to me. RICS valuations can be accurate or inaccurate, optimistic or realistic (almost never pessimistic!), they are by no means created equal and their presence would neither persuade or dissuade me from investing without reading their contents.
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