BitOfProperty Review: An innovative platform to consider in the real estate crowdfunding market in Europe. Let’s analyze the platform and whether it may be a great place for your investment money.
Considering joining or expanding your property crowd investing platform? Our BitOfProperty review below will analyze a very successful European real estate crowd investing platform.
BitOfProperty Overview: What is BitOfProperty?
BitOfProperty is a real estate crowdfunding platform based on the blockchain. It makes property investment affordable to the ordinary investor, starting from as little as 50 EUR.
The company launched in 2017. It’s headquartered in Singapore with a subsidiary in Estonia. A young, innovative team heads it. Key people in the company include:
Karl Vään – CEO and co-founder of BitOfProperty
Taavi Pettai – COO and co-founder of BitOfProperty
How BitOfProperty works
BitOfProperty searches and evaluates properties that meet specific criteria. It does all the research and due diligence and only lists the property when satisfied.
It then divides the property into shares with an initial price of each share at 50 EUR. Investors can then evaluate documents provided for each property, including location, performance, etc. to determine suitability.
In essence, investing with BitOfProperty is similar to investing in stocks. An investor receives shares in the property that represents beneficial ownership. The investor, therefore, has a right to rental income.
However, owning shares within BitOfProperty is passive and doesn’t bring any obligations to the investor.
Operational matters eg, property management is handled entirely by the BitOfProperty team.
Key facts at a glance
Launch date: 2017
Headquarters: Singapore with a subsidiary in Estonia
Investment Types: Real estate specifically rental properties
Loan Security: Real estate used as collateral
Accepts investors from Worldwide (except the US)
Registered investors: Over 1000 investors in April 2019
Expected return rates: Upto 12%
Fees: 10% management fee
The accepted currency on the platform: EUR
Investment term: 3-5 years
Minimum Investment: 50 EUR
How to Open an Account on BitOfProperty
Becoming an investor in BitOfProperty is a fast, easy, and straightforward process. Simply signup up on the website using a valid email address. You can also use your Google account to signup.
Fill out your details and verify your account using an official ID such as a government-issued ID or passport. Verification takes 1-2 days.
You can register as an individual or as a company.
Once verified, you’re ready to start investing. Transfer funds into your accounting, for example, using a bank wire transfer. The money can take up to 3 days to reflect in your account.
How to Invest in BitOfProperty
Now that you’ve verified and funded your account, it’s time to start deploying your money.
To invest on BitOfProperty, head to the properties section to view the marketplace. From here, you can see and analyze listed campaigns and properties.
When you find a campaign that meets your criteria, enter the amount of money you wish to invest and confirm.
BitOfProperty has a calculator that uses rental income to estimate capital growth and shows you the estimated annual income.
Funds invested in a campaign go towards crowdfunding properties. Successfully funded properties then generate rental income (if the property has tenants).
Capital gains also accrue to be paid at the end of the investment term.
You can also find investment opportunities in the secondary or over-the-counter market. This is where other investors seek to offload some or all of their holdings. BitOfProperty lists over-the-counter properties alongside initial investment campaigns.
You’ll need to fill out four questions that include:
- The price you’re willing to pay per share
- Number of shares you wish to buy
- Whether you’ll allow partial fill orders
- How long your order should stay active on the market.
Your bid is then matched to sellers willing to sell at your preferred price. You’ll need to confirm, via email, whether to take the deal when a match is found.
Types of Investments Available at BitOfProperty
BitOfProperty is a real estate crowdfunding platform. Investors can invest in properties in two ways:
- Invest in an ongoing crowdfunding campaign (initial investment) to acquire a property.
- Buy available shares from investors wishing to sell
You need a minimum of 50 EUR to participate in a campaign or buy shares.
Investors then earn income into two main ways.
- Rental income when a crowdfunding campaign successfully concludes, and BitOfProperty acquired the property.
- Capital gains
You start earning rental income immediately when you buy shares on the over-the-counter(secondary) market, and the property already has tenants.
BitOfProperty Auto Invest Tool
Unlike most other P2P lending platforms, BitOfProperty currently doesn’t have an auto-invest tool. It’s typical of some other real estate lending platforms.
The company is, however, looking to build that feature in the future, according to CEO & Co-founder, Karl Vään.
How Much Can You Earn on BitOfProperty?
Investors typically see a return of around 9% on their invested capital. It’s an average return across most P2P lending platforms. While not overly impressive, it’s a great start and a reliable way of diversifying into the real estate space.
Fees, taxes & other charges
BitOfProperty charges a 10% management fee, taken as a cut from the rental income. The 10% property management fee covers insurance, money administration, tenant communication, etc.
No transaction fees charged when buying or selling shares in the listed properties.
Who Can Invest In BitOfProperty?
BitOfProperty welcomes all investors from around the world except US citizens. Legal and regulatory requirements make it expensive and untenable to bring on US citizens and companies.
All investors must be of legal age.
The platform has some definite characteristics that make it suitable for investors. They include:
- All loans on the platform are secured with real estate
- Low minimum investment requirement at just 50 EUR
- Blockchain backed investments creating accountability and transparency throughout the entire investment process
- Easy-to-use and intuitive platform for both beginners and seasoned investors
- Fast signup and ID verification up to 2 working days
- Young, innovative, and professional leadership team
- 100% passive investment
- Secondary market available, called “over-the-counter” on the website
Our analysis uncovered several drawbacks and potential disadvantages for investors. These include:
- Low-interest rates and returns (around 9%) compared to other P2P lending platforms
- No Buyback guarantees
- Management and performance fees eating into profits
- No Auto-Invest tool/feature
Let’s tie this up: BitOfProperty is a young platform. It has, however, distinguished itself by being fast and innovative. The team, though young, energetic, and lacking extensive experience in the sector, is working day and night to improve the platform and make it better for investors.
The returns, while comparable to other P2P platforms, have ample leeway to improve. The lack of a buyback guarantee and the 10% management fee could be drawbacks to some investors.
Bottom line: BitOfProperty is a stable platform for investors who wish to diversify into the real estate sector. It’s also great for investors looking for a 100% passive income revenue stream.
Put your capital to work and then sit back and watch it grow.
Other Crowd Investing Resources
Looking for more options? You might want to read some of our other crowd investing and peer to peer lending reviews. There are many peer to peer lending and investing platforms currently available, and you can diversify your interest income by using several of them simultaneously.
You can consider some other peer to peer companies checking our Crowdestate review, Estate Guru review and our PropertyPartner review. Check out our posts on the best peer 2 peer lending platforms in Europe, and the best real estate crowdfunding platforms in Europe.
Are you already investing in BitOfProperty or in any other peer to peer lending platform? Leave your thoughts and questions about this BitofProperty review below.