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CapitalRise launched the first Innovative Finance individual savings account for prime residential property this week.
The new IFISA lets investors lend money using Financial Conduct Authority-regulated peer-to-peer lending platforms and receive interest and capital gains tax-free. It has similar rules to the existing cash ISA system. CapitalRise’s new product will allow savers to invest a minimum of £1K and up to £15,240 in the current tax year (rising to £20K in the 2017-2018 tax year) in prime residential property, targeting tax-free returns from 10% to 14% per annum.
Launching alongside the IFISA is CapitalRise’s fourth investment opportunity for a residential development at Strand Chambers, 227-228 Strand. The company is looking to raise £1.2M from small investors via the CapitalRise platform.
Strand Chambers is being developed by Seastar Developments, which delivered an award-winning scheme on the Strand in 2014.
CapitalRise CEO Uma Rajah said in the current low interest-rate environment and with inflation predicted to rise significantly in the short term, the property will prove very attractive to UK investors.
The platform has raised more than £3M across three deals, giving everyday investors the chance to invest in properties such as a row of five new-build townhouses in Yeoman’s Row, Knightsbridge, and an apartment in world-famous Eaton Square in Belgravia, from only £1K.
The third property for 38 Yeoman’s Row was so popular with investors that the offer closed in just 71 hours. Each of CapitalRise's previous deals is on track to provide returns of at least 10% per annum.
CapitalRise arranges for funds to be lent to developers of prime real estate, but protects investors by structuring deals so the developers would always lose their money first if anything went wrong.
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