First crowdfunding project to address housing crisis in UK

Abundance, Britain’s leading peer-to-peer ethical investment platform, today launches a new move into the social and affordable housing sector, building on its six-year track record of financing renewable energy and energy efficiency projects, by seeking to address the shortage of affordable rental homes in the UK.
Responding to feedback from existing customers who wanted its ‘win win investing’ approach to be applied to new sectors, including property, Abundance believes this new investment will show there is a better way to finance and build long term social and affordable homes for ordinary people. This move into financing affordable property is a bold new direction for Abundance that could in time prove highly effective at tackling the UK’s housing crisis.
The investment is called “Merseyside Assured Homes” – from pioneering housing developer Octevo Housing Solutions – and it aims to raise up to £4,250,000 to fund the construction of 21 mostly 3-bedroom, social or affordable rental homes and nine 2-bedroom supported living flats in and around Liverpool. The 3-year secured investment is paying 4.5% interest a year, which includes a 0.5% bonus from Abundance, with capital returned in full on maturity.
Once the housing is complete and ready for occupation, registered social landlord Finefair Housing will find and manage suitable tenants from those unable to afford market rents, on the basis of a lease that lasts at least 50 years. Finefair has the option to purchase the homes for £1 each at the end of the tenure.
Finefair Housing’s sister company, Finefair, already manages around 2,000 properties for public (local authority) and private landlords. Through its relationship with Octevo Housing Solutions, it will expand into Liverpool where more than 20,000 people are on council waiting lists looking for homes or in need of supported living accommodation.
Robert Macmaster, Director of Octevo Housing Solutions Limited, said: “We set out to design a viable long-term solution that will ease council waiting lists and prevent housing shortages from continuing to escalate. Our business model has been created to address the core procurement and funding barriers faced by local authorities and housing providers, and to deliver a robust new solution that can make a significant contribution to addressing local housing issues.
“We believe that the home should be the treasure chest of living. We hope investors will join us in helping to build quality homes that offer opportunities to other people to create their own homes and improve our society.”
Bruce Davis, joint Managing Director of Abundance, said: “Abundance has led the way with our win-win approach to support the transition to a sustainable, green energy economy. Now we want to use the power of crowdfunding to help address the structural problems of the UK housing market. We can change the way we finance new developments so that families and young people no longer have to bear unsustainable levels of housing costs. Everyone wins when more people get access to stable and long-term homes – tenants benefit, communities are stronger and small investors get a fair return.
“We believe that Merseyside Asssured Homes can show there is a better way to make the housing market work for everyone, a way which balances investment potential and social impact without fuelling the property bubble.”
The new homes will be built on three different brownfield sites in Merseyside, which already have planning consent. They will be built to high standards integrating sustainability and energy efficiency and aiming to foster a sense of local community.
As with all Abundance investments, Merseyside Assured Homes is raising money through tradeable Debentures, with a minimum investment of just £5, which are eligible to be held in an Innovative Finance ISA so returns can be tax-free. It is expected to be the first in a series of housing projects across the UK from Octevo listed on Abundance’s online platform.