A pioneering method of investment is being trialled by a Grantham-based developer.
House builder Webster Homes is the UK’s first company to offer crowd funding opportunities directly into developments.
The idea is that members of the public can get involved. Anyone over 18 can be an investor, with a minimum initial outlay of £1,000. The firm is promising a guaranteed seven per cent return.
Webster Homes director Tom Webster said: “We are really excited about this development in our business as it, for the first time, allows the house building market to connect with the public. The public can now see great returns in their investments whilst facilitating the construction of fantastic new exciting places to live. It can be business model that becomes a game changer for the house building market.”
Mr Webster believes the crowd funding venture will lead to more houses being built across the East Midlands. The campaign will initially be used to finance the development of small sites around the Grantham, Melton Mowbray, Lincoln and Nottingham.
He said: “The model can lead to the increase of new homes being built as it can remove some of the barriers preventing good development sites from being built. This is what makes the idea really exciting, for the first time being able to bring the public closer to the house building industry.
“All of the homes we build will be eco homes, so it will increase the publicity and the demand for homes which are cheaper to run and more environmentally friendly. Hopefully this will be a trend other house builders follow too.”
The firm plans to build 20 homes in the next 12 months through the crowd funding business model, expanding to 100 the following year.
The scheme, which is also known as ‘peer-2-peer lending’ opened in October in order to gain enough capital to begin construction in the new year.