12 Month Returns with Bricklane.com

It’s now a year since we launched our Regional Capitals fund, focussed on Leeds, Manchester and Birmingham, and we’re pleased to update you on the returns our investors have made.

As a reminder, this fund purchases desirable properties near these city centres, with strong rental demand and potential for price growth. Investors make a return based on rental income and movements in the value of properties owned. Due to its REIT status, the fund pays no corporation tax on gains or income, making returns very tax-efficient.

Returns to date

Over the past 12 months, an investment of £10,000 in our first fund would have grown to £10,900 — a return of 8.7% per year.

Taking into account the effects of platform fees, and a three year time horizon, investors would earn 8.0% per year.

This return has been driven ~30% by rental income, and ~70% by price movements in the portfolio, reflecting positive market performance and valuation uplift on properties acquired at a discount**. Looking forwards, we expect the net rental component of this fund’s return to be about 3.4% (though projections aren’t a guide to the future).

Performance vs. other options over the last 12 months

Many of our customers have been attracted to property as an investment due to its risk profile: you can see and touch it, it generates a potentially steady income, and many feel they understand the dynamics of the market better than stock market investments such as equities and bonds, or alternative finance options such as Peer to Peer lending or crowdfunding.

We exist to help customers gain exposure to the property market in a way that’s hassle-free, tax-efficient, low cost and easy to understand.

At any time, there may investment options that perform better or worse than the funds available on our platform and the wider property market, but we wanted to give you a snapshot of how Regional Capitals investors have fared vs. other investment options across the last year

Taking into account the effects of platform fees, and a three year time horizon, Bricklane.com investors would earn 8.0% per year.

Though the risk/reward profile of our Bricklane funds is designed to be conservative, we’re pleased that performance has nevertheless been strong vs. other options of potentially greater risk profiles.

In Summary

Past performance isn’t a guide to future returns, but we believe that the performance of our Regional Capitals REIT after one year has been strong, particularly on a risk-adjusted basis, and there are many reasons to be positive looking forward.

In addition, despite launching just over a month ago, our London fund has already generated a return of 4.8% driven by strong uplifts in the value of initial property purchased (94%) and rental income (6%)**.

Find out more about investing with Bricklane.com:

Unlike with a Cash ISA, with all investing, your capital is at risk. Tax rules apply and may be subject to change.

** Earnings figures are an unaudited estimate as of 05/10/17.

Sources (accessed 22/09/17):

Leading Roboadvisor: Nutmeg 7/10 risk portfolio based on an investment of below £100k

P2P Lending: http://www.altfidata.com/marketdata/

iShares UK Property UCITS ETF: https://www.ishares.com/uk/individual/en/products/251802/ishares-uk-property-ucits-etf

Cash ISAs: Top one year fixed rate MoneySavingExpert

Bricklane.com provides a smart, tax-efficient and low-cost way to get exposure to the property market, through a simple and secure platform.

If you have any questions about returns, or anything else, you can email us at support@bricklane.com, talk to us through online chat, or give us a call on 0203 1111 432.

Capital at risk. As with all investments, the value of your Bricklane.com investments can decrease as well as increase. It could take the time it takes to sell a property, or longer, to get your money back at an acceptable price.

This is a financial promotion by Bricklane Investment Services Ltd, which is an appointed representative of Gallium Fund Solutions Limited, which is regulated by Financial Conduct Authority, FRN: 487176