UK residential property crowdfunding platform Property Partner is launching a new bidding engine, allowing investors to place orders for shares in residential property on its online resale market.
The aim is to make trading easier and more liquid by encouraging different investment personalities to express themselves. Official launch is planned for early September, allowing time to trial with a small group of dedicated users and make improvements.
Acting as a residential property stock exchange, Property Partner enables anyone to buy shares in individual or multiple properties for as much or as little as they like. Investors are currently able to list shares at any time, at a price of their choice, to trade those shares with others on the resale market.
The new bidding engine will make this simpler by allowing investors to see prices listed, prices people are willing to pay, and what others have recently paid for that property on the unique secondary exchange. It works like any other bidding function. Users will be able to place a bid order as well as a sell order. If prices cross the same range, the trade occurs. Users can also see a 30 day trading history, as well as any outstanding orders that have yet to match.
The feature is expected to improve liquidity throughout economic cycles by helping investors understand the prices at which shares are trading, and allowing them to compare current market sentiment with the official valuation from an RICS Chartered Surveyor.
Despite the EU Referendum and market uncertainty, most Property Partner investors have held onto their shares, with only 0.33 per cent of total investments being listed at a discount to the original price within 11 days of the Brexit vote. Within 14 days, opportunistic investors had snapped up more than 99.32 per cent of these investment offers – even without the new bidding function.
By contrast, property funds (mostly commercial) such as Aviva, M&G, Henderson Investments and Standard Life have had trading suspended.
Property Partner launched to the public in January 2015 and now has over 8,000 investors, who have invested more than GBP35 million across 234 properties in the UK.
Dan Gandesha, CEO of Property Partner, says: “We built Property Partner to make it easy for anyone to invest in property. A bidding function holds true to that vision by improving price discovery and liquidity – allowing users to enter and exit the market at the click of a button, with confidence. We also believe at Property Partner that we can make the property market fairer for everyone – and that means giving a voice to both buyers and sellers.
“Previously, our marketplace was more like an estate agent’s shop window than a trading floor. A marketplace should be driven by an expression of intention from both sides, and not just the sellers. After all, whatever the official valuation, a property is only worth what people are willing to pay for it.
“An exchange is a product for any market situation. Property Partner allows users the freedom to take their view on the market, and this bidding feature will allow the ‘bulls’ and the ‘bears’ of the property market to interact seamlessly for the first time.”