As usual, here’s an update on my experiences with Estateguru. In March, 30% of my investment amount had defaulted, and now it’s nearly 38%. I’m not entirely sure how Estateguru calculates this, but I calculate it by dividing the total amount of defaulted loans by the current invested loan amount.
However, my figure should also be taken with some caution, as I am currently not investing any new money in Estateguru. This means that the invested amount is gradually decreasing, while the number of defaulted loans continues to rise. In March, there were 63 defaulted loans, but this has now increased to 83. But, and this is the first good news in a long time, some projects have now been recovered, so I am currently tracking 79 loans in recovery. However, the older defaulted loans have not been updated in a long time. My oldest case is now 542 days old. It has allegedly been scheduled for auction multiple times, but nothing has happened otherwise.
If I only look at the number of defaulted loans in relation to the currently active loans, I get a default rate of 27.5%. The reason the defaulted loan amount is higher is that there are loans where I had invested more. You can also see this in the following table, which I generated from Estateguru’s data (it’s great that you can download almost every report as a CSV file):
When I look at the current real estate market in Germany, I am somewhat concerned about how quickly the amounts invested in Germany can be recovered. However, the LTV (Loan to Value) ratio is very low for most projects, so even if only half of the value is recovered in auctions, I would still be in the green. But it’s likely that there will be enough foreclosure auctions in the coming months. Estateguru describes the process in great detail, also differentiating by country. Especially in Germany, it can take over a year before anything happens. Investors on the Estateguru platform must therefore always be prepared for the fact that they cannot access their money in the short term.