EstateGuru investors have earned €306k from secondary market sales
Sellers on EstateGuru’s secondary market have earned more than €306,500 (£270,141) to date, with around two thirds of them making a profit, new figures have revealed.
The European peer-to-peer lending platform said that over 118,000 loan parts have been sold on its secondary market, with an average claim size of €155, and at an average discount of 1.94 per cent. The average amount of time per sale is just under one-and-a-half days.
Meanwhile, for buyers, the average return on secondary market deals is 30.99 per cent, EstateGuru said.
Read more: EstateGuru reports 14.3pc default rate
Of the loan parts bought, 54.58 per cent have been repaid, 25.32 per cent defaulted, 15.53 per cent are performing and 4.57 per cent are late.
“When you consider that the average return on investments in the primary market (that have not subsequently been sold in the secondary market), is around 10.7 per cent, you can see how potentially lucrative the secondary market really is,” the firm said in a blog post on its website.
More than 95 per cent of EstateGuru’s mortgages are first-rank, meaning that its investors are prioritised when the collateral is sold. Its loans have a maximum loan-to-value ratio of 75 per cent.
Read more: EstateGuru sees property development slowdown in Baltics
“Even when loans are defaulted, we still have solid options for recouping investments,” the firm said. “In fact, EstateGuru has recovered over €28m in these cases, with our investors still earning over 8.74 per cent interest on their investments.”
Read more: EstateGuru names new CEO amid strategy changes
When loans are sold on EstateGuru’s secondary market, all returns are divided between the seller and the buyer based on their actual investment duration. This means that the seller will earn interest for the number of days the investment was in their portfolio and the buyer will start earning returns from the day they purchase the loan.
EstateGuru announced earlier this month that it has raised equity funding to safeguard the business against macroeconomic challenges and support its plans for growth.
It also secured a new funding line with Czech investment bank J&T Banka to fund property loans in the Baltics.
