{"id":222841,"date":"2022-02-04T11:04:09","date_gmt":"2022-02-04T16:04:09","guid":{"rendered":"https:\/\/www.livabl.com\/articles\/?p=222841"},"modified":"2022-02-04T11:07:36","modified_gmt":"2022-02-04T16:07:36","slug":"female-fractional-investment-startup-real-estate","status":"publish","type":"post","link":"https:\/\/www.livabl.com\/articles\/news\/female-fractional-investment-startup-real-estate","title":{"rendered":"Fractional investment AI startup BuyProperly opens doors to real estate market"},"content":{"rendered":"

<\/h4>

\"\"<\/a>Photo:\u00a0Torval Mork<\/a> \/ Adobe Stock<\/em><\/p>\n

Real estate is expensive, and it\u2019s only getting pricier.<\/p>\n

In its latest report<\/a>, the Toronto Regional Real Estate Board said that it expects home prices in the Greater Toronto Area to rise another 12 per cent this year to an average $1,225,000. Meanwhile, in Metro Vancouver, the benchmark price for all residential properties<\/a> reached $1,255,200 in January, up 18.5 per cent from a year ago. For anyone looking to buy into the real estate market as an investment, rising prices sure aren\u2019t making it easier.<\/p>\n\n

BuyProperly<\/a> is a Toronto-based investment marketplace that lets users build wealth in real estate starting from $2,500. Founder and CEO Khushboo Jha, who previously worked for tech giants like Amazon and Accenture, created the company after finding a lack of options when it comes to buying real estate.<\/p>\n

After starting in 2019, BuyProperly has launched 13 properties<\/a> on its online platform, including a home in Austin, Texas. Using a proprietary AI system that uses over five million data points to identify deals of interest, users can opt to invest in a selection of real estate offerings from single-family homes to pre-construction developments and commercial properties.<\/p>\n

Parts of this interview have been removed or edited for clarity and brevity.<\/em><\/p>\n

How would you explain what BuyProperly is?<\/h3>\n

It\u2019s kind of like buying stocks, except you are buying stocks of real estate. You browse your properties, you click on what you like, you put in the amount that you want to invest and you basically check out. It\u2019s a very Amazon-like experience of buying houses.<\/p>\n

What led you to start the company?<\/h3>\n

It started out of my own frustration. I used to work at Amazon, and I\u2019m a big saver, so I am always, always saving. I can even save when I\u2019m on a student stipend. But when it came to real estate, it was kind of out of my reach. That got me thinking, \u201cOkay, if I\u2019m at Amazon and that pays reasonably well and I save and I still struggle, what is happening to the rest of Canadians?\u201d<\/p>\n

That got me researching \u201cWhat are the options for buying real estate if you do not have all of the money?\u201d and there wasn\u2019t much of an option. You could put it in a real estate mutual fund, but then again, that was not seen as doing a private deal.<\/p>\n

\"\"<\/a>Photo: Khushboo Jha, BuyProperly. Image courtesy\u00a0Talk Shop Media\u00a0<\/em><\/p>\n

In May 2021, BuyProperly raised $2 million in funding to expand. What has happened since then?<\/h3>\n

We have made our AI richer. We\u2019ve launched in the US, so we\u2019ve expanded into another country. Now, Canadians can actually invest in properties in the US on a personal basis. We\u2019ve started being able to provide people with a little bit of segmentation based on their portfolio. Those are some of the things we\u2019ve done. Our secondary marketplace launched online as well, which means if people wanted to sell the shares of their property, they could list it on the platform and sell it to other buyers.<\/p>\n

Real estate is getting more expensive. Has demand increased for BuyProperly because of this? How is this a more accessible point of entry into real estate investing?<\/h3>\n

It is getting harder for everyone. It\u2019s not just that you have to be a younger person or a middle- to lower- income person. It\u2019s difficult even if you\u2019re earning $150,000 a year because you need $200,000 just for the downpayment for a lot of houses in the GTA. That\u2019s a huge amount. It\u2019s almost out of reach for the majority of Canadians. About 70 per cent of Canadians earn less than $100,000. With real estate prices rising, this obviously becomes more relevant.<\/p>\n

Even if you take that out of the equation \u2014 the prices going up \u2014 the other thing that investors are getting from the platform is the convenience. Even if you have the money, it\u2019s cumbersome to find an agent, lawyers, coordinating, going around searching, analyzing, never knowing if you paid the right price or not. That\u2019s a lot of effort that goes into investing in real estate, which is also something that we take away and do it for the customers.<\/p>\n

Why is $2,500 the minimum investment?<\/h3>\n

At the time when we started out, we thought that $2,500 seemed like an amount that would not be too high for most people, but also not be such a small amount where you wouldn\u2019t care what the returns are. If you put in $10, it doesn\u2019t matter if it doubles because it\u2019s only $20. It has no consequential impact on you. And so the intent was that it should be a real mechanism of actually building wealth, but also not so high a number that people cannot get to it.<\/p>\n

\"\"<\/a>Image:\u00a0BuyProperly dashboard. Image courtesy Talk Shop Media<\/em><\/p>\n

How do you actually make money?<\/h3>\n

All of our rental properties have a monthly rental income. That\u2019s the first revenue stream that you would have as an investor. The second would be capital appreciation, which you will only see at the end of the hold period, which for us is typically five years. At the end of the five years when you sell, you will get the gains from the capital appreciation.<\/p>\n

The third one would be principal paydown. Because we are using leverage, it kind of increases the value of equity over time and the principal paydown is another piece that adds to your return. And the fourth one is [reinvestment]. What we do at our end is reinvest a small amount of cash that a property generates back into the house to make it more energy efficient so that it is a greener, smarter house.<\/p>\n

What makes you different from other companies?<\/h3>\n

There\u2019s a couple of things that we offer that I don\u2019t believe anybody else does. One, is we are the only platform that uses AI to actively identify properties, because what it does for us is simply lower the cost. We don\u2019t hire an army of brokers or a team of investment bankers that run the analysis. We\u2019ve instead coded it into the AI model which makes affording the cost of these properties much cheaper and the outcome much more efficient. No matter how awesome your agent or broker is, there\u2019s only so much they can access in terms of data. As humans, there\u2019s only so much they can do. There\u2019s no way that they run the whole GTA every Thursday in three hours, right? That\u2019s the big advantage that we have.<\/p>\n

We are also the only and the first company to offer a secondary marketplace. When you buy these shares, you can actually sell them in the secondary marketplace any time you want. That is another thing that differentiates us. It solves the liquidating problem of real estate, which means it\u2019s not like if you bought it you\u2019re stuck forever.<\/p>\n

We are the only fractional real estate company that offers a cross border option, which I believe is a huge deal to be able to just expand into another geography without having to worry about taxes in that country or how things work in that country because we will manage that. Right now, we\u2019ve only expanded to the US, but we hope to be able to add more countries over time.<\/p>\n

<\/div>\n","protected":false},"excerpt":{"rendered":"

A female-founded proptech startup is working to make investing in the housing market more accessible and convenient with its fractional real estate 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