Shares scheme launched for homes
This is Money (C)
14 June 2005
THE UK’s first property exchange was launched today enabling investors to buy and sell shares in individual houses.
The property will then be rented out by a letting company and investors will split the rental income, minus fees, according to the proportion of the property they own.
When people want to end their investment they simply re-sell their shares through the exchange, at a higher price than they bought them for if the property is considered to have risen in value.
There are currently 18 properties available through the exchange and the group expects the number to increase substantially in the coming months.
The exchange currently only offers residential properties in the UK, but it hopes to expand to include commercial property and overseas residential property in future.
Chief executive Stephen Kenny, who helped set up betting exchange Betfair, said: ‘The benefits of investing in the buy to let market have been well documented over recent years and yet this is an asset class that remains inaccessible to most.
‘Opromark opens up the buy-to-let market to a broader range of investors, including those struggling to get on the housing ladder, by making the minimum investment £1 and ensuring that investors can diversify their investment cost effectively across a range of residential properties.’
When a property is first introduced to the exchange people can view its details, including an independent survey, valuation and searches, and analyse the performance of comparable properties to decide whether they want to invest in it.
Investment in individual properties is restricted to 10% of the available shares. If someone exceeds this level they have to make an offer for all the remaining shares in the property.
Stamp duty will have to be paid on any properties bought through the exchange, but the group said it was currently trying to limit properties to ones which fell below the £120,000 threshold above which the tax is paid.
Membership of the exchange is free, but Opromark charges people a trading fee depending on the size of their investment, ranging from 3% for investments of up to £3,000 to 0.5% for ones over £250,000.
The exchange can be accessed at www.opromark.com
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