Despite rising interest rates, viable funding options are still available for those looking to acquire property businesses, according to mergers and acquisitions consulting firm Atomic Consultancy. 

Atomic founder Lucy Noonan said that the Bank of England’s decision to raise interest rates from 4.25% to 4.5% had caused apprehension within the property sector and raised concerns among those looking to buy or sell an estate or lettings agency in the near future. 

However, she insisted that the challenges can be managed, and high interest rates should not be a deterrent for those looking to buy or sell a business.

Noonan believes those looking to make a move in the estate or lettings agency market should explore the various funding options available, weighing the cost of funding against the profits to be made from a successful acquisition. 

According to Noonan, commercial lending is still a popular option, despite the higher interest rates, and integrating two businesses can bring significant economies of scale, saving costs and adding real value.

Equity funding, whereby businesses raise money for acquisitions by giving away a percentage of equity in their business, is also a viable option, Noonan said, advising that this option allows business owners to invest at pace and with greater ambition, without the costly repayments associated with traditional lending.

Crowdfunding, although “not for everyone”, can also be an effective way to raise funds for acquisitions, Noonan added. The Atomic founder also pointed to Funding Circle, an online platform that links funders and investors to make quick decisions on loan applications.

“We know the market is turbulent, but don’t let high interest rates put you off acquiring,” Noonan said. 

“There are plenty of viable funding options available and healthy profits waiting to be made with the right purchase.”