A new app will soon launch that lets landlords release equity in their properties and then sells shares in it to investors who get a percentage of the monthly rent.
Proptee, the brainchild of Benedek Toth (pictured), is an investment platform where property investors can buy and sell shares in rental properties from as little as £1, generating a monthly rental income depending on how many shares they own – without the hassle of getting a mortgage or paying agent management fees.
The business model is a stock exchange for properties, Toth tells LandlordZONE, letting investors check photos, rent projections and tenant details to make informed investment decisions.
The 24-year-old says the idea was borne of frustration at not being able to get a mortgage despite having the capital because he didn’t have a credit history – although he was still able to invest in stocks.
10% equity for 10% of rent
After a landlord sells a house or releases equity, Proptee releases shares to investors, so for example, owning 10% of the property means they’ll get 10% of the rent.
It can also manage properties for them, he says. “The concept should appeal to many landlords as it releases equity without them getting into debt, and it’s much quicker than the traditional sales model as there are more potential buyers.”
Just about to kick off its first round of fundraising ahead of the platform’s launch early next year, Proptee already has 1,300 potential investors signed up, with five properties on the books so far, and plans to get 50 on board.
Says Toth: “They can be anywhere in the UK but we’re looking for people who take care of their properties.”