It's no secret that investing in real estate requires substantial capital, whether buy-to-let or buy-to-sell. Crowdfunding platforms allow investors with a fraction of the required capital to invest in real estate projects. The risks you are ready to take are a factor in the potential return on investment.
At the end of 2020 a buy-to- let platform was launched, InRento. By the number of investors, it has become the largest licensed crowdfunding platform in the EU, providing an opportunity to invest in rental projects.
InRento s clients invest in existing properties and earn from monthly interest and capital growth once the property is sold at a higher price. Income from capital growth is what no other real estate investment platform has offered before InRento.
Some investors just look at what they will get from the rent but forget another part of the return capital growth. Gustas Germanavi ius, founder and CEO of InRento, says we offer our investors the opportunity to earn from both. If the property is sold cheaper than purchased, the project owner will have to bear the loss and pay the full amount to the investors. The profit is distributed proportionally to the investors, the project owner, and InRento if the property is sold at a higher price. A modern office in Vilnius, Lithuania was sold recently. Instead of the projected 6.06% annual return, the investors earned more than 20% in ROI.
The buy-to- let project was funded in a few weeks last year. After the project owner sold the property at a higher price, investors earned an additional 14.26% capital growth net, according to Deividas Urbanovi ius, InRento's Investment Manager.
Another rental project - an office in the Newtown of Vilnius - was completed shortly after. The annual ROI of the project has reached 17.48%!
The average annual return on rental income and capital growth from InRento's completed projects is 19.49% now!
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The specialists of the InRento platform carefully select the projects to be funded to ensure a more stable asset value and protect clients' investments. The platform's community is offered projects in central parts of cities and developing districts. Real estate appraisals are done for each project, and its potential profitability is analyzed today and in future perspectives.
When looking for projects and placing them on the platform for funding, we aim to have a generated rental income that exceeds the interest on the loan. The interest payable does not cause significant financial challenges for the project owner and reduces the risk of insolvency. Before embarking on the project, we also look at the possible price change and sales perspective, so we work only with professional project owners who sell the property when the best opportunity arises, says G. Germanavi ius.
According to InRento's management, mentioned project exits prove that a well-thought out investment can yield a much higher than average return. There is no doubt that there will be more examples in the future when investors earn not only from rental interest but also from capital growth.