A crowdfunding website has been set up with the aim of raising money to assist first time buyers purchase their homes.
It has been created by Dorset-based website designer Sam Toms who says his mission is to develop a non-profit organisation, that operates through a crowdfunding platform.
His recently-created site - you can see it here - is short on detail but suggests the public can acquire and trade shares in first time buyers’ properties up to a maximum of 50 per cent of the value of the homes.
Toms suggests investors put in smaller sums across a number of homes rather than a larger investment in just one. “This makes for a even better option for someone that wants to buy to let because the risk is less based on the property market in one area” he claims.
The site says it works like this: the first time buyer posts details of the property that they wish to purchase; the crowd then views and funds up to 50 per cent of the property’s price; the first time buyer obtains a mortgage in the usual way for the remaining 50 per cent; then pays a monthly rent to ‘the crowd’ rather like a shared ownership scheme.
The site claims investors would receive roughly two to five per cent yield.
We have reported on other crowdfunding schemes, aimed more overtly at property investors. However this one, says Toms, aims at philanthropists, councils and companies that ‘want to make a difference’ to first time buyers.
But an early attempt to win over the public to the idea via an article in The Mirror received something of a blow.
The newspaper’s website ran an online poll asking readers whether it would work as a system to help first timers - up to yesterday evening, the reaction was 2-to-1 against.