Listen to this episode below:
Today I am delighted to be joined by Frazer Fearnhead, CEO of the House Crowd, a property crowdfunding platform launched in 2012.
Frazer started his professional life as a solicitor in the music industry, before going on to launch several successful businesses of his own. Alongside his various careers, he began investing in his own property portfolio in 1994 and decided almost 20 years later that property crowdfunding was the solution to help people overcome the frustration of poorly performing pensions and savings.
Since then his company has gone on to win many awards and fund hundreds of property deals, not only helping those frustrated investors get a fantastic return but also helping ambitious developers with an alternative to bank finance.
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Investing Strategies
Frazer believes people should diversify when investing, although he keeps within his area of expertise (which is of course property) and leaves the other asset classes to the financial advisers.
From a rental point of view he has owned a number of HMOs over the years but after noticing the market change Frazer had a few issues with them from a tenancy point of view and made the decision to move away from them to a more stable and reliable income stream. His focus now is on assured long term rentals with corporate clients delivering average gross yields across the portfolio of around 9.5%.
Obviously though with his own crowdfunding platform available to provide finance for his deals though Frazer’s investing goes far beyond a buy to let model, with completed projects ranging from single family homes to large commercial conversion projects, title splits and new build developments.
Biggest Success
Bollin Heights is a recently funded project converting a 13,500 square feet office in Cheshire into 24 luxury apartments. It was purchased for £2.5 million with an additional £1 million required for build costs, and an expected GDV of £4.65 million giving a profit in excess of £500,000 after all additional costs for finance, professional fees etc.
Once the initial build is complete, Frazer intends to maximise his returns from the site by building an extension which will add an additional 12 apartments.
Biggest Difficulty
Frazer has found that the further away from his area of expertise he goes, the more problems he seems to face. By way of an example, he discussed a penthouse apartment he purchased in Birmingham where the mortgage is several hundred pounds more per month than the rental income!
The worst one he ever bought though was a property in Cyprus where he believes there was a joint effort by developers and financiers to take advantage of overseas investors with promises they knew would never come to fruition.
What’s Your Favourite Book?
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The Compound Effect – Darren Hardy
The Alternative Guide to Property Investment – Frazer Fearnhead
If you want to secure a discounted copy of Frazer’s new book, order a copy via https://www.thehousecrowd.com/contents/alternative-guide-to-property-investment
Frazer Fearnhead Links & Resources
The House Crowd Website – A resource packed website with videos, FAQs, and investment information packs for property crowdfunding deals