Ok. This is a little idea that just popped into my head the other day. Hear me out and Id appreciate any comments, criticism or feedback about whether or not its a possibility and whether it sounds like a good enough idea to sway a potential investor..
I have a handful of investment properties at the moment which currently see returns from 6.5 - 19.1% p/a. My latest deal I'm hoping to land will see a return of 32.5% after a small budget renovation.
Before you ask, these are all residential properties. The returns are on the purchase price and all my houses are currently tenanted.
My idea is simple. To sell 'shares' in the various properties (10% per share) and limit the shares sold in a particular property to 50%. I would retain the other 50%
I would then offer a guaranteed rental return of 8.5 - 10%, paid monthly. I will not charge any fees, rates, insurance etc. I cover these costs.
The cherry for me would be to sell the shares for double the value of the property e.g. If I have a property valued at 180,000 I would sell 5 x 10% shares at 36,000 each totalling 180,000 with a guaranteed return of 58.00 - 69.00 per week.
The buyers would receive the returns above, paid monthly and with the capital I have raised, frees me up to buy another property, rinse and repeat.
So it would work by me basically selling the property worth 180,000 too 5 investors for a total of 180,000. I still own 50% (90,000 equity) and up to 10% of my rental returns are forfeited to the new owners. As most of my properties return much higher than this, this would cover the costs associated with owning the home.
The capital raised will not be spent, it will simply offset the mortgage on that particular property, giving me the option to buy another.
Anyone wanna give me a bit of feedback so far?
I have a handful of investment properties at the moment which currently see returns from 6.5 - 19.1% p/a. My latest deal I'm hoping to land will see a return of 32.5% after a small budget renovation.
Before you ask, these are all residential properties. The returns are on the purchase price and all my houses are currently tenanted.
My idea is simple. To sell 'shares' in the various properties (10% per share) and limit the shares sold in a particular property to 50%. I would retain the other 50%
I would then offer a guaranteed rental return of 8.5 - 10%, paid monthly. I will not charge any fees, rates, insurance etc. I cover these costs.
The cherry for me would be to sell the shares for double the value of the property e.g. If I have a property valued at 180,000 I would sell 5 x 10% shares at 36,000 each totalling 180,000 with a guaranteed return of 58.00 - 69.00 per week.
The buyers would receive the returns above, paid monthly and with the capital I have raised, frees me up to buy another property, rinse and repeat.
So it would work by me basically selling the property worth 180,000 too 5 investors for a total of 180,000. I still own 50% (90,000 equity) and up to 10% of my rental returns are forfeited to the new owners. As most of my properties return much higher than this, this would cover the costs associated with owning the home.
The capital raised will not be spent, it will simply offset the mortgage on that particular property, giving me the option to buy another.
Anyone wanna give me a bit of feedback so far?