Property website Zoopla has launched a peer-to-peer investment channel which gives investors the chance to invest in buy-to-let mortgages.
Zoopla has partnered with peer-to-peer lending platform Landbay to offer the new investment channel, which has a minimum investment of £100 and is available on Zoopla’s website zoopla.co.uk/invest.
Alex Chesterman, founder of Zoopla, said investing in buy-to-let mortgages is statistically the lowest risk form of peer-to-peer lending.
“Property investment has never been available to the masses before in this way and for those looking to get onto the property ladder or saving towards a property purchase, the ability to ensure that their investments keep pace with the property market is essential.”
The channel also includes a tax-efficient online property Isa.
Landbay connects investors with professional buy-to-let landlords and looks to provide a competitive loan to the landlord, secured against the property, in return for predictable returns for the investor.
Matthew Harris, IFA and owner of Dalbeath Financial Planning, said: "My concern is simple: Although affordability rules have been tightened a bit, it's pretty easy in general to get a buy-to-let mortgage at present.
"There are plenty of banks willing to help and rates are lower than ever," he said, adding he rarely needs to turn a buy-to-let customer down.
"Given that customers who need to get a buy-to-let mortgage from a peer-to-peer lender are likely to be those who have been refused by mainstream banks, I would worry that they must be quite high risk borrowers.
"As such, I would want to watch from the sidelines for a while to see how this develops."
A spokeswoman from Landbay said: "We do the same credit checks a bank would do, and in fact we specifically target borrowers who are experienced buy-to-let landlords, which means they are likely to already have mortgages with traditional lenders."
