Economy

EstateGuru, a European peer-to-peer property lending platform, reports no loan defaults in either Germany or Finland, according to recent assessments of the company’s performance. The platform, which facilitates investment in property-backed business loans, has navigated economic headwinds without experiencing loan write-offs in these key markets.

EstateGuru connects investors with businesses seeking financing secured by real estate. Loans are typically short-term, used for bridge financing, working capital, or development projects. The company operates across several European countries, including Finland, Germany, Estonia, Latvia, Lithuania, Sweden, Portugal, and Spain. The platform states that its average historical return for investors has been 9.97%.

The absence of defaults in Germany and Finland is particularly noteworthy given broader concerns about economic stability and potential downturns in the real estate sector. Recent reports indicate that EstateGuru’s loan portfolio consists of little and medium-sized enterprises. The platform emphasizes the security provided by the underlying real estate collateral, allowing for potential recovery of funds through foreclosure proceedings if a borrower defaults.

EstateGuru’s investor base spans 108 countries. To participate, investors must be at least 18 years old and hold a bank account within the European Economic Area (EEA) or Switzerland. While account opening and investment are free, withdrawals incur a €3 fee, and selling loans on the secondary market carries a 3% commission. A monthly inactivity fee of €10 is levied on passive investment accounts.

The platform generates revenue primarily through fees charged to borrowers, with origination fees ranging from 2.5% to 4% of the loan amount, and annual administration fees between 0% and 2%. Some investors have expressed concerns regarding increased fees and changes to platform policies, including increased cash withdrawal fees and penalties for inactive users, as reported in recent user reviews. One user review noted a decline in service quality and rising prices, while another highlighted concerns about the impact of issues with German borrowers on market confidence.

Despite these concerns, EstateGuru continues to attract investors seeking higher returns than traditional fixed-income investments. The platform currently advertises potential returns exceeding 12%, and offers an Auto Invest feature for automated portfolio management. SalkunRakentaja.fi reports that EstateGuru investors can receive a 0.5% bonus on invested capital for the first three months after registration.

EstateGuru’s business model relies on careful loan selection and risk assessment. All loans are secured by property located within Europe, aiming to mitigate risk for investors. The platform’s success hinges on its ability to accurately evaluate borrowers and manage the potential for defaults, particularly in light of evolving economic conditions.