New property loans flood the market. Should we be worried?

All good questions you raise although I doubt you will get answers from FS. A further issue with this volume of loans hitting this market is the effect on the secondary market which IMHO is suffering something close to a crucifixion. Currently if you urgently need to get your cash out quickly, forget it, unless you get very  lucky and offer a 3% discount. However on SS sales on the secondary market seem to take no more than micro seconds.

There are a few more question investors need to ask and top of the list is the current fears being created by the possibility of departure from the EU. If this should happen there is a distinct possibility that property prices may suffer. By how much and when are further questions that need to be asked. Cap this with a possible slowdown of the economy and things get even more interesting. These I fear are times when it pays to be cautious rather than speculative. 

I been with FS now for well over 2 years , back to the days of old cars and Rolex watches, and personally I've always liked them and I liked investing in the novelty/smile factor stuff, FS has grown rapidly over the last 6 months, with a lot of PBL loans, whether the quality of the loans is ok will be down to your own DD (or lack of it.  . As I know) If I was an outsider looking in right now, I don't think I'd get involved, I think I would hold off and check back in 6 months or so to see how the completing loans are being handled. FS have had a fair few property loans complete In the past with no issues , so this is not new ground to them, but it will be interesting to see whether they have the capacity to deal with many many more larger loans completing in 6 or so months time. There are more fundamentally important issues I think that they also have , which will I suspect add to any future problems they may/may not encounter.

edit lot not dearth

Hardly a dearth! Quite the opposite.

Correct.. Fancy grammar not my strong point.

A few random observations:

Its hard to assess the quality of many of the FS loans because a)  the quality of the valuations tends to be much weaker than seen elsewhere and b) we don't get much commentary regarding borrower financial health and exit plans.

Most FS property backed loans are for projects that from the outset are obviously going to last longer than 6 months, which means the platform has the strain of raising funds to fill the gap of non-rollover lenders every 6 months.  The rapid increase in new loans over the last 3 months is likely to create difficulties for FS when they are ready to roll them forward in 3 to 6 months time.

As the supply of loans on FS increases without a commensurate increase in lenders, lenders can increasingly cherry pick, and decline to rollover the poorer quality loans (or at least those with poor quality supporting documents).  The Londonderry loans are an example of poor quality supporting documents, and are struggling to re-fill.

FS loan quality varies a fair bit, there are certainly deals being offered at the moment I would not touch at the rates offered.
SS has a similar problem but at least the quality of the documentation is normally higher.  Even there there are too many I would not touch.

Given the high proportion of property both are offering, I don't think we should worry, just think very carefully if you want the original investment or the roll over.  I'd suggest discard 2/3s of the deals.