How buying could be just another brick in the wall

A new scheme aims to bypass mortgages and allow buyers to crowdfund their way on to the property ladder

- Charlotte Duck

A new scheme launching today could revolutionise the homebuying market, potentially ending the need for mortgages altogether. Through its crowdfunding platform, Allbricks lets buyers purchase a home by crowdfunding for investors to buy "bricks" - essentially shares in the property, then paying those investors rent while they gradually buy the "bricks" back.

The buyer chooses a property on the open market, which is then valued by a RICs-accredited surveyor and Allbricks uses this and local market conditions to decide how many "bricks" are needed to make the price of a single brick affordable (this tends to be about £100 a brick). As an example, a two-bedroom, £685,000 property in Shoreditch has 6,850 bricks, each costing £112.18.

After putting down a deposit, the buyer can then crowdfund for investors to buy the remaining "bricks". If this process is successful, the buyer then pays the investors rent on those bricks with a regular chance to buy a proportion of them back.

Allbricks CEO Shahram Shaida says: "Homebuyers can choose the home they want to crowdfund for and aren't limited to properties below £500,000, new builds or leasehold. As there's no mortgage and no debt, purchasing power is based on what they could comfortably afford to rent rather than mortgage-based income multipliers."