Alpha First Securities claims Investors frustrated by low interest rates are increasingly turning to investments via property mortgages to secure higher income.
They have seen a 25% increase in the past six months of investors wanting active investments in the property mortgage field said Alpha First Securities director Olivia Fraser.
Two years of tight bank credit means there’s now a large number of very good property investors and developers banks are no longer extending credit to, Fraser said.
Fraser said land developers, who are trying to meet rising demands for housing, are flocking to non-bank alternatives for support and there are some very high-quality developments that investors can be matched with.
Bank credit has been incredibly tight for the past two years and the banks are turning away what have previously been excellent lending opportunities for them.
Investors are increasingly opting for property mortgage investments from the likes of Alpha First Securities which return 8-9%, with interest paid out monthly, rather than the average 3% banks are offering on term investments, often paid annually, Fraser said.
Alpha First Securities has noticed an increase in the number of investors who qualify as “wholesale investors” and who have this “frustrated capital” and who are tiring of the previous four to five years of very low returns from banks, Fraser noted.
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