MoneySmart - Why This Property Investment Platform is a Game Changer, Offering Fractional Ownership of Properties Without All the Heavy Lifting
Property has always been one of the most coveted investment assets, particularly favoured by mid- to long-term investors, who enjoy the relatively stable returns offered by tangible real estate.
SINGAPORE, May. 29 2022 / MoneySmart / – Property has always been one of the most coveted investment assets, particularly favoured by mid- to long-term investors, who enjoy the relatively stable returns offered by tangible real estate.
To gain investment exposure to real estate, many investors tend to turn to REITs, property funds and stocks of property development companies. As there are high barriers to entry and multiple moving parts to manage when purchasing physical property, many are unable to take this route and rely on other forms of real estate exposure.
RealVantage has disrupted property investing
Property investing has traditionally been a less accessible asset class. For retail investors like myself, institutional-grade investments are instruments that I don’t qualify for.
In addition to high barriers to entry, investing in overseas real estate can also be complex, as investors might not be familiar with the markets they are investing in, as well as their particular risks. Furthermore, purchasing physical property, whether locally or overseas, can be an expensive and time-consuming process, not to mention when it is coupled with issues such as differing tax treatments, searching for tenants and being compliant with local regulations.
…And we haven’t even touched on commercial real estate, which, as a retail investor, I don’t have access to as well.
These problems might soon be a thing of the past thanks to RealVantage, a homegrown platform that is making a difference by democratising physical real estate investing — with the goal to make property investing accessible and affordable to a wider pool of investors through fractional ownership.
“At RealVantage, we pool capital together as one significant property investor and position ourselves on a level playing field against big institutional investors of the real estate world, so as to secure even better deals. Our goal is to ultimately unlock a world of institutional real estate investing for all clients,” says Keith Ong, co-founder and Chief Executive Officer of RealVantage.
Why fractional ownership makes sense
Fractional ownership enables multiple investors to invest in a physical real estate and own shares of the property. By pooling their money together, these investors are able to invest in physical real estate at a much lower investment amount than if they were to purchase property as individuals.
Through fractional ownership of a real estate, investors are actually owning a certain number of shares of the property. This differs from investing in Real Estate Investment Trusts (REITs) and real estate funds in some ways.
REIT investors do not own property. Instead, they own shares in a company, aka REIT, that owns the properties. In a similar vein, when investing in a real estate fund, investors merely own units of the professionally-managed fund and do not directly own any of the underlying assets.
Fractional ownership offers many of the same advantages as physical property ownership, without the hassle and high costs. The main difference is that the investors are subscribed to shares in the investing organisation that owns the assets or a stake in the entity that ultimately owns the property. Through fractional ownership, investors are able to invest in different real estate assets that sit within the private markets, which allows their portfolios to be diversified away from the stock markets, helping reduce overall investment portfolio volatility.
The pros do it best
RealVantage prides itself on being a leading property fintech firm in Southeast Asia that provides investors access to co-invest in a diversified range of institutional-quality properties in a hassle-free way. It is also the first private equity real estate investment platform in Singapore to have received a Capital Markets Services licence from the Monetary Authority of Singapore.
Through the RealVantage platform, investors can build a diversified investment portfolio of real estate. You see, most of RealVantage’s deals have been overseas (USA, UK and Australia) with one based in Singapore. In addition to geographical diversification, RealVantage also has deals across different property types, investment strategies, investment time horizons and investment quantum.
All properties are sourced and managed from end-to-end by real estate professionals, so investors need not worry about the nitty-gritty and can just sit back and let the professionals manage their real estate investments.
The minimum investment amount is 15,000 in the local currency of where the property is located, which is a lower barrier to entry, especially for retail investors like us. Through RealVantage, investors can start small and gradually build a diversified real estate investment portfolio, which can be one component in a more holistic investment strategy.
So, how is RealVantage’s track record? Since 2019, RealVantage has invested in 26 deals in Singapore, Australia, the UK and the US. To-date, many retail and accredited investors have collectively entrusted & invested over SGD40 million into deals listed on the platform.
“In 2021 alone, our company realised four deals, all of which have either met or outperformed the initial projected returns. The average net internal rate of return, or IRR, of these realised deals ranged between 7% per annum to 18% per annum. We also achieved an annualised income distribution of 7.5% per annum for income-generating deals,” says Mao Ching Foo, co-founder and Chief Operating Officer of RealVantage.
RealVantage’s success can be attributed to the team’s expertise in identifying and managing investment opportunities. The company’s co-founders and advisors are highly experienced in real estate investments, quantitative trading, private equity, venture capital, equities and fixed income, and their combined relevant experience is in excess of 100 years.
Take the first step towards hassle-free property investing
RealVantage makes it possible for investors to own physical real estate assets, and gain exposure to potential capital gains and rental income.
You can now start investing with confidence and build up your real estate investment portfolio, knowing that all aspects of your investments are being handled by real estate experts.
For as little as 15,000 in the local currency of where the property is located, you could become a property investor sooner than you expect. Start small, dream big!
Ready to start building your real estate investment portfolio? Open an account with RealVantage today.
© This article was published in MoneySmart on 29 May 2022. All copyright and other intellectual property rights in the article belongs to Catapult Ventures Pte Ltd.
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Disclaimer: The information and/or documents contained in this article does not constitute financial advice and is meant for educational purposes. Please consult your financial advisor, accountant, and/or attorney before proceeding with any financial/real estate investments.