In December 2021, we offered our investors a new project type – slightly different from real estate – a business loan. Today, we are adding one more success story to our track record by successfully exiting all 4 stages of the Interchem business loan project. The project made monthly interest payouts, earning our investors up to an outstanding 18% p.a.

We explain below how this project became a successful collaboration and win-win combination.

Meet the borrower

The company Interchem Distribution Europe OÜ is trading with composite materials, and chemical components. Over the years, the company developed a wide range of destinations in the supply chain of chemical products and clientele.

The company was doing quite well as it was, but the management saw an opportunity to increase the market share and improve business numbers if they would be able to take a step up in trading volumes at the beginning of the year. After doing thorough due diligence, the Reinvest24 team came to the conclusion that the project is safe enough to be offered on the platform and presented this opportunity to its investors.

Funded in only 2 hours

We were extremely happy to see such interest from investors, as the first stage was funded in less than 2 hours, becoming the first project to be funded in such a short period of time. This also proves that Reinvest24 investors have an interest in financing different project types and not just real estate. We offered 4 stages for funding, for a total of 800 000 EUR. For all 4 stages, we had 839 unique investors, many of whom invested in several stages.

Success story

The funding received at the right time gave the company an opportunity to increase the amount of the raw materials it was ordering. It resulted in getting better pricing and terms on larger volumes. The CEO of Interchem said,

“This gave us an advantage over our competition, we were able to increase our volumes and also the profit margin”.

The CEO of Interchem Distribution Europe OÜ

As a result, the revenue of the company has increased by over 20%, but more important is that the profitability of the operations has increased significantly providing more than 50% growth in profits. 

This was a strong win-win collaboration that allowed the company to reach its business goals and improve its position in the market. Besides, Reinvest24 investors earned a decent interest rate on their investments.

Where to invest next?

Our platform is constantly growing, allowing you to invest in more and more outstanding projects from different countries. Check out the projects currently available for investments.

Read some of our other success stories:

1. Our P2P investment earned 24.3%;
2. 2 land plots project exited with a total effective return of over 25%;
3. All Majaka properties exited with an average profit of 14.24% per annum;

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In this blog article, You will find out the latest updates about the Nistor residential building project. Also, see the pictures from the construction fields.

Key facts about Nistor residential building:

Nistor is a 12-storey residential building, located at the edge of Chisinau City center. It offers premium-class modern apartments with floor-to-ceiling windows at very affordable prices. 

1. LTV – 50%. Please note that for this project several stages are planned and the LTV for each stage will not exceed 50%;
2. Collateral – 1st rank mortgage;
3. Duration – 6 months;
4. The contract is in EUR currency, therefore currency risk is eliminated;
5. Provided by an experienced international developer, who has finished more than 25 residential complexes with 4595 ready-to-use apartments.

The update for 27.09.2021 – project exit

We are happy to announce, that today we are repaying back to our investors the 7th stage of the Nistor residential project. With that being said, our second Moldovan project becomes fully and successfully exited. The 7 staged projects earned 930 investors 14.75% in annual average yield and repaid back to our investors 555 000 EUR.

Of course, we could not leave You without the last update on this project. Below is the video to take a look at how the building looks right now, thanks to Your support.

The update 17.03.2021

Roof works are in progress. You can also see great views opening from the upper floors of Nistor building.

The update on the progress 01.03.2021

The construction works are 60% ready and almost all the apartments are already reserved.

So far the developers completed the works listed below:

1. Installed the pile field;
2. Developed the pit;
3. Built the reinforced concrete frame constructions;
4. The masonry of external walls;
5. Installed the windows in the apartments;

The apartments have all the walls in place to separate the layouts, as well as the windows. Now the developer is installing the scaffolding around the building to start with the facade works and installation of the stained glass for the ground-level commercial spaces. At the same time, they will start with piping and electrical works, and then move on to the installation of towers and ventilation systems. After that, the elevators will be installed and the finishing touch will be the improvement of the outside territory. The property will be fully finished in the second half of 2021.

Read more information about Moldovan real estate in the articles below:
1. 7 reasons why you should consider Moldova as your next real estate investment destination.
2. Moldova outlooks and update on Moldovan real estate market.

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Continuing the series of our monthly development project “Insider updates”, today we are sharing with you the latest updates about the Belgrad residential project from Chisinau, Moldova.

Successful exit – all 3 stages repaid back

We did it! From today, the Belgrad residential project is officially exited, repaying back to 334 participated investors 240 000 EUR. All 3 stages generated 15.3% in adjusted annual effective return. We would like to congratulate all participants and thank you for the trust given. Discover more projects like this in our property section.

The first successfully exited project from Moldova

We are happy to announce that we are exiting the first stage of this project, repaying back to our investors 90 000 EUR and earning 15.4% in adjusted annual effective return. This exit is also our first track record of successfully exited projects from a new market – Moldova.

What we did

Thanks to 189 investors participating, we were able to finance the final part of this project’s construction, which was supposed to take up to 9 months. During this period our investors were able to receive a 15% yield with monthly payouts. The first principal repayment was done within 6 months, allowing to reinvest the funds received in even more profitable properties.

Updates on 05.05.2021

Updates on the progress 06.04.2021

The construction works are currently in final phase. The apartments are being transferred one by onw to their new owners. The building will be fully finalized within a few months and our investors will be able to enjoy the returns from their investments into this project.

Updates on the progress 28.12.2020

Past months were extremely productive for Belgrad development team and they were able to complete the following works: 

• Installed 764 windowsills;
• Conducted the final plastering works of walls (2500 m²);
• Installed 87 exterior doors; 
• Finalized electricity-related works;  
• Completed additional works of ceramic floor tiling; 
• Installed the drywall ceilings (176m²);
• Did the final plastering works of сeilings and sanding (176m²);
• Painted ceilings 2 times;
• Installed the playground and road curb (135m²);

As of today, all the apartments are booked and their new owners are waiting for the interior works to be fully finished. After the works are completed and the sell transactions made, the funds will be repaid to our investors. We are planning that this project will be finished as well as repaid during the next 6-7 months.

Updates on the progress 30.11.2020

In October 2020 we opened the funding for this property and during the past month developers were able to do the following things:

• Plastered 2100 m² of walls;
• Concreted the floors;
• Connected to the gas infrastructure of apartments;
• Finished with ceramic floor tiling;
• Installed sanitary equipment;
• Manufactured 108 apartment doors and installed 54;
• Connected electricity to the apartments as well as carried out the general electric network.

Key facts about Belgrad residential project:

• LTV – 50%. Please note that for this project several stages are planned and the LTV for each stage will not exceed 50%;
• Collateral – 1st rank mortgage;
• Duration – 9 months;
• The contract is in EUR currency, therefore currency risk is eliminated;
• Provided by an experienced international developer, who has finished more than 25 residential complexes with 4595 ready-to-use apartments;
• The property is 80% completed already and it is at the final stage of construction.
  
  See more details of this property and invest in Chisinau here.

The most recent insights about Moldovan real estate market can be found here:
1. Moldova outlooks and update on Moldovan real estate market
2. 7 reasons why you should consider Moldova as your next real estate investment destination.

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In this blog article, You will find out all the information about our Bauskas development project, from the very beginning until its successful exit.

Successful project exit

As announced in March, we started the refinancing process of this project. Now we can confirm that everything went smoothly and all the 7 stages were exited, repaying back to our investors 635 350 EUR. In total, 852 investors participated in financing the Bauskas project. And the total adjusted annual effective return was 13%. Also, this project is our first successful exit from the Latvian market. Curious to see how it all started? Take a look below and see for Yourself how from the empty land plot Kirsan developers built this residential building.

Update on the progress: 30.03.2021:

Starting from 29.03. Bauskas development project is in the refinancing stage. This means another successful exit is approaching Reinvest24 investors – as we are ahead of schedule and the project will be repaid before its maturity day. We would like to congratulate everyone that took part in this project, as it earned 13-14% p.a.

To explain the framework we are following and how things are working at Reinvest24, we decided to answer the most important questions you might have, based on a real-life example:

• Why is the Bauskas development project getting refinanced?
  The main reason for that – a lower % rate for the Borrower.
  
• Why did we simply not lower the interest rate for the Borrower?
  The Bauskas project was providing a 13%+1% (bonus) return for Reinvest24 investors. Currently, our average project return is 14.8-14.9%. We have plenty of other attractive opportunities to offer to our investors rather than decreasing the interest rate.
  
• When will the repayments be done?
  As of today, the project has been paying monthly interests without any delays. We expect the principal repayment to happen during the coming weeks. Also, It depends on the speed of the Latvian Notary to make this transaction.
  
• Important information to bear in mind
  On Reinvest24, the Bauskas project was providing investors with 13-14 % annual interest and current (actual) LTV of 52% instead of the stated maximum of 67%. The refinancing terms are a bit different, offering 11% p.a. with an estimated LTV of 75%.

Update on the progress 08.01.2021:

• The roof works are prepared and waterproofing works are being prepared;
• The staircase from the parking lot to the rooftop exit is completely ready;
• Technical equipment of the elevator and the exit to the rooftop is completely ready;
• The formwork has been delivered;
• The blocks for masonry walls of the first floor has been imported and are ready to be used; 

Update on the progress 30.10.2020:

Embraced by the beauty of the fall season, our Bauskas development project becomes higher and higher. 

As of now, the frames of all 5 floors have been installed. The reinforcement binding of the floors and structural support columns are almost finished. Today the Bauskas street is full of concrete mixers, as our team of constructors is binding and concreting the final covering of the roof. After this step is done, we can say that the building frame is ready. 

Besides, the project manager Maksims Bedenko is stating that the sunset views from the 5th floor are simply breathtaking. 

Update on the progress 22.09.2020:

When it comes to the property building, the great management of it is the key to success. And in terms of Bauskas development property, we can proudly say that we are lucky to have partnered with this well-experienced developer. No additional words are needed on the progress, just look at the pictures below. During the past month, the team of constructors built the 2nd floor and started work on the 3rd floor of Bauskas residential complex. As of today, the project is 1,5 months ahead of the planned schedule which is considered as a great sign.

Video update on the progress 31.08.2020:

Updates on Bauskas project for 21.08.2020

Here are the updates of works that have been executed so far:

For the -1 level and underground parking:

• Renewed the construction pit surface with concrete layer 60 cbm of concrete;
• Constructed the rain sewer and elevator shafts, using 5 cbm of concrete;
• Prepared for concrete slab – reinforcement mesh binding;
• Concreted the concrete slab, using total 358.50 cbm of concrete;
• Bound the column mesh and concreted column, using 59 cbm of concrete;
• Bound the basement/parking wall mesh and concreted, using 59 cbm of concrete;
• Formworks for ground-level ledges, meshed and concreted, using 7 cbm of concrete;
• Ledged walls, meshed and concreted it, using 6 cbm of concrete;
• Overlapped the slab of the basement/parking, meshed and concreted, using, 133.5 cbm of concrete;
• Started the construction works for the 1st-floor columns – mesh, concreting.

As of 21th of August, the full basement and underground parking is ready and wide form-works returned to the supplier already.

Updates on Bauskas project for 03.08.2020

The city of Riga has approved all the permits and the construction works has began. 
During the last couple of weeks, the construction team performed the following works:

• Renewed construction pit;
• Made an entrance for underground parking;
• Leveled the basis of construction pit and poured 400 m3 of concrete for a basis;
• Polished the basis and started to create foundation for the walls;
• Created elevator and drain shafts;

Here you can see the 3D visualisation of Bauskas 57 project.

Please, see below the pictures from the construction fields:

Key facts about the project:

1. The apartment building in a green district and close proximity to shops and transportation lines; 
2. LTV – 67%
3. Collateral – 1st rank mortgage;
4. Duration – 12 months;
5. Payment frequency – Monthly interest payments 
6. Provided by an experienced international developer, who has finished more than 10 residential complexes and 2583 apartments;

Read the full project description here.

What is going on in Latvia?

According to an economist with Citadele Bank, Latvia successfully overcame the first wave of COVID-19 more successfully than other European Union (EU) countries. The country itself is in a strong position according to many economic indicators. The Economist states that despite the initial good news, there are doubts regarding the uncertain future of the virus spread. However, there is hope that thanks to previous experience and Latvia’s strong position compared with other countries, a second flare-up may be easier to overcome.

The money is coming

On 21 July, in Brussels, at the conclusion of one of history’s longest summits of leaders of the EU member countries, an agreement was reached both on the next multiannual EU budget and the European Economic Recovery Fund. As a result, the EU will provide more than 10 billion euros for the development of the Republic of Latvia. According to Latvian Prime Minister Krišjānis Kariņš, the available European funding will bring the greatest added value to Latvia. If it will be invested wisely, of course. The government will implement improvements in various areas such as education, health care, the taxation system and others. Also, the agreement provides funding for the implementation of the Rail Baltica project. It is a greenfield rail transport infrastructure project which will connect 5 EU countries – Poland, Lithuania, Latvia, Estonia and Finland.

Over the next seven years, almost 10.5 billion euros will be available for the development of the Latvian economy. Compared to the current EU multi-annual budget for the period from 2014 to 2020, it will make a 39% increase.

How is Real Estate market feeling?

In regards to the real estate market, the updates are following. The Baltic Course reports that, compared to May 2019, the number of real estate transactions in Riga decreased by 43% this May. In general, investors who invested in Baltics real estate are benefiting, as average prices continue to rise. Currently, the total number of real estate transactions in the Baltic capitals is growing. And current forecasts suggest that higher activity can be expected in August and September.

Considering investment options in Baltics Real Estate? Take a look at our 4 currently available properties. 

Also, soon are expected the amendments to the National Real Estate Cadaster Law and the Law on Immovable Property Tax, which provide for the abolition of the tax for primary homes worth up to EUR 100,000. The Justice Minister Janis Bordans reports that this would mean, for instance, property tax on a primary home with a cadastral value of EUR 80,000 would be zero euros, but for a home with a cadastral value of EUR 120,000, the property tax would be calculated from EUR 20,000.

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In 2019 we introduced 2 projects to our investors – land plots with great potential, next to one more project that we exited last year – Vinkli 13. We found the land plots and the developer, who was interested in buying them but lacked the funds for acquisition. We financed the buying of 2 land plots. The total amount of financing was a little bit over 500 000 EUR. 

Both projects were located in the Mustamäe district, Tallinn, Estonia – best known as the main technology hub of the country, where companies, such as Skype, Starship Technologies and main Tech Universities are residing. Already back then, we saw great potential in the capital growth of real estate, as well as overall developments in this area. And our estimations were right. 

Works performed 

As our investors know, Reinvest24 has a strong focus on a project’s cash flow and always seeks for the most sustainable investment opportunities.

One property had garage premises on it. Those premises were rented out to car repair shops and similar companies, thus, creating a healthy cash flow of more than 6% for that property. 

The second land plot was used to build a test polygon for Starship Technologies – one of the leading Estonian Technology companies. The aim was to test their AI delivery robots and teach them how to navigate in our world, by bypassing obstacles and creating different real-life conditions and situations. This allowed us to generate another strong source of cash flow for our investors yielding over 7.5%.

Those land plots were also in the process of changing the detailed planning so it would be possible to build office premises and use its potential of being close to Tallinn University. 

Projects’ exit

As the main purpose of using these land plots was changed, in 2 years the developer, who has planned to build stock office type of premises finalized the purchase of plots. As a result, our investors who were invested during the full period of the projects earned over 25% in total adjusted returns.

How 25.05% adjusted interest rate was achieved?

Many retail investors are still not familiar with the benefits that a compound interest strategy can deliver in a relatively short time. It stands for reinvesting any income that a certain investment might generate. In our case, it is monthly income that can be reinvested on our secondary market. This is the beauty of investments that are available on Reinvest24. Recently we conducted a practical case study of one of our projects, showing you the difference and how this can be achieved. 

Where to invest next? 

Our platform is constantly growing, allowing you to invest in more and more outstanding properties. Take a look at our currently available projects from 4 different European markets. Do not forget to use our 3rd-anniversary cashback campaign to increase your returns even more. 

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Majaka 54 was the first development project of Reinvest24. The development was conducted by our own real estate team. We built 2 additional floors on top of 2 floor apartment building. All together there were 5 parts of this project on Reinvest24 platform, one of them were divided into 2 separate projects during the payout. Despite the challanges we had, implementing this project all the projects have been exited successfully and the repayments with an average of 14.24% annual income has been paid out.

The start

The story of Majaka 54 began in late 2018 when Reinvest24 team found an old building in a very bad condition but in a very promising location in the city of Tallinn. 

The third and fourth floors were empty shells and required a lot of construction as well as legal work to be done in order to achieve full compliance with the City Hall. The aforementioned has allowed us to purchase the property way under its market value, thus securing great profits for our investors. We made an agreement with the main contractor, to start the construction works before they receive a payment.

Within just a few weeks time the project planning was made, the construction permit was renewed by the city hall and we began with the construction works. Brand new walls, windows, ceilings, floors were in place in just a few months time. We moved on to installing the new electric cables and piping system. The new energy efficient heating system was installed.

The final stage

Once we had finished the inside construction works, we moved on to the building’s facade and the roof. Not only did we improve its visual appearance but we also upgraded the technical parameters of it. An additional layer of isolation materials was added, making the whole building more energy efficient. 

Nothing extremely crazy or lavish about it, but still charming and comfortable – perfect for showing off the power of its great location and the breath of history kept in the walls.

After 10 months of hard work, soviet house transformed into a fresh and modern property. Every detail was carefully selected and quality crafted. Highlights include:

• Full interior finishing works; 
• New electrical wiring and water piping;
• New kitchen and bath appliances; 
• Brand new furniture.

Exiting the projects

Now that the project was fully finished it was time to sell the apartments. We sold the first 2 apartments quite fast and everything seemed to go as planned. But as they were big 4 room apartments and we had 4 of them in the same building, with a similar planning, the selling process slowed down. In the beginning of the year we had a lot of interested buyers coming to see them, but we were not able to finalize the sale before the COVID19 pandemic situation escalated. Estonia announced lockdown and everybody sat paralyzed at home, waiting for the indefinite future. But we managed to find a way to sort it out.

Real estate backed investment – 14% yield per annum

The apartment nr. 12 was the first apartment that was sold in Majaka 54 building. This development project promised our investors 14% annual returns, which was paid out in full together with the principal amount.

Real estate backed development project

The apartment nr. 11 was the second apartment that was sold in Majaka 54 building, about month after the sale and repayment of the first one. This development projects promised our investors 15% annual returns, which was paid out in full together with principal amount.

Apartment development in Tallinn´s tech hub

As the apartments were quite large, through 2 floors, 4 rooms with a total area of ~100sqm, and both floors had everything necessary for living (bathroom, kitchen etc.), we decided the divide the apartments into 2 seperate units. It required quite a lot of legal work, but we were confident that it will speed up the selling process as the market was a lot more active for 2 room apartments. After the legal work was done, we were able to sell both of the units in apartment nr. 10 within just 1 month and it was during the time of COVID19 lockdown! This development project promised our investors 13% annual returns, which was paid out in full together with the principal amount.

Duplex apartment development in Tallinn’s tech hub – unit 1.

The apartment nr. 9 was the last development project in this building and we had 2 units left to sell. The unti 1 on the first floor was sold first the repayments were made straight after the original project was divided into 2 seperate prorjects. This project promised our investors 14% annual returns, which was paid out in full together with the principal amount.

Duplex apartment development in Tallinn’s tech hub – unit 2.

The second floor unit of apartment nr. 9 was the last one to be sold. It did not take long after the first unit was sold. Just like the unit 1, this project promised our investors 14% annual returns, which was paid out in full together with the principal amount.

Rental apartments in Tallinn’s tech hub

This was the only rental project in this building. The property had 2 units and due to its location it worked well for short-term rent. We used a service provider who was managing the day-by-day rent and paid a fixed 8% to our investors. 10 rental payouts were made and everything was going well until February 2020. The short-term rental market got a big hit from the lockdown, which made the service provider to seize the operations. Renting the unit long-term would have made the selling process difficult. Since we were seeing a lot of demand for smaller units in this building we decided to put our full focus on selling them. It did take some time to get it finalized, but as of today, the profits from the sale have been distributed to investors. All together this property earned our investors 15.2% per annum.

Lessons learned

Investment risks

With every investment, there are always some risks involved and it is important to acknowledge it and evaluate them. The good thing about real estate investments is that no matter how challenging the project is or how bad the circumstances get, you can still get through them without harming investors funds and income. Which is not the case with loan originators who are having difficulties. The recent pandemic situation has proven that point quite well, and in many cases the recovery is unlikely.

The developer

The key factor for a successful and timely executed development project is the experienced developer. Professional team with great enthusiasm and ambitions might not always be enough. A developer with a proven track record and a capable management team is what it takes to complete the project successfully. Risk is something that we take very seriously at Reinvest24 and that is why we found an experienced construction company with experience on different markets and building partnerships with them.

Short-term rentals

From financial point of view it does not make any sense to operate just 1 or 2 units in one location. To optimize the costs and maximize the profits, it is essential to have more units to take care of in a single location, or at least very close to each other. Even if you are working with service providers, you will be able to agree on better terms and have more efficient operations and thus profitability.

Wrap-up

What does not kill you, makes you stronger, right? We can say that this has been the case with this project. It was a great experience for our team and there was a lot we learned from it and making adjustments to future projects.

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Now it is undoubtedly clear! The turbulent events of Q1 did everything to make 2020 a year to remember. While some are panicking over a stock market crash, some desperately sweeping toilet paper from the shelves of supermarkets. And well-known investment banks are forecasting the potential economic impact of coronavirus pandemic, we at Reinvest24 have had a successful property exit of Office and Crypto hotel project earning 14.07% return per annum for our investors. How we achieved it? Here is our success story.

Started from the bottom

Reinvest24 investors had an opportunity to invest up to 191 616 EUR into the property and receive a proportional part of the t rental profit and capital growth, paid out as a variable interest.

In May, 2018, the first Reinvest24 property became available for a wide pool of p2p investors. It was located in the second most populated residential district with one of the best microclimates in Tallinn and consisted of 22 office rooms with a total area of 628 m2. Full of energetic students and convenient in terms of excellent access to public transport and parks – it stole the hearts of many Estonians.

We were able to secure this property at 270 EUR per m2, which was way under market price. The property was old and needed some additional investments and work to fully utilize the rental potential.

After we receive total funding, the most exciting part began. Due to the property’s close location to high voltage substations and minimum costs of Crypto mining infrastructure, we decided that a part of the property will be used for a Crypto mining hotel. For that purpose, we have renovated the rooms, adopted special electricity connections and ventilation. It gave us a possibility to rent out these rooms with higher than average renting price.

Key facts:
Funding target – €191,616
Category – Office space
Yield – 14.07%
Rental yield – 9,07%
Capital Growth – 5.00 %
Duration – 19 months

Now we are here

As estimated, the property’s prospective location became a key factor in the rise of its value of a healthy 5% and increased demand for smaller Offices with low maintenance fees.

In total it hosted 14 incredible and enthusiastic tenants, representing different industries such as art, finance, crypto and wholesale of metal and pallet-related products. It even became an office space for the well-known professional Estonian ex-basketball player.

Before the property exit, it did 19 rental payouts, which generated a staggering 9,07% yield for our investors, altogether generating 14.07% return per annum.

The reasons for property exit

Due to the fact that this was an old building, additional construction and renovation works were inevitable. We conducted some piping work in the summer of 2019, which we thought should be enough. But at the beginning of 2020 it became clear that some costly sewerage works need to be done in the near future. Also, after several discussions and cost estimations, the team of Reinvest24 decided to exit this property, as we are always looking to have a full understanding of the long-term plan for our real estate investment properties.

In conclusion, investors who invested in this property received 14.07% return on their P2P investments in real estate. The exit of the property was in March 2020. As of today, all our investors have already received their share of the profits, paid out directly to their accounts.

Looking for similar properties to invest and grow your capital?

Take a look at Reinvest24 p2p properties available for investments and start growing your long-term capital to secure your retirement. Read more in our blog post: How can you secure your retirement by investing in real estate?

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As you may recall, Reinvest24 invested in a luxurious rental apartment in the impressive Avangard building in the centre of Tallinn back in March 2019. In September 2019, we successfully exited the investment, earning our investors 24.3% in the total combined return. This has been one of our most successful P2P investments in real estate to date, and this is how it happened.

P2P investments made into a luxury apartment in a historic rental building

When Reinvest24 first came across this Art Nouveau property, we took into consideration a number of factors. The high initial price of the rental apartment was a downside, but we also saw lots of potential in the great location, and the fact that it was a purpose-built rental building with modern amenities such as a laundry room and shared rooftop terrace. The investment property also passed our comprehensive selection process. Read our article: How we choose the right investment objects.

Global P2P investments in real estate

Peer-to-peer investments, also known P2P investments, were made by various international investors. In total, Reinvest24 issued over 79,000 shares to online investors from around the world, looking to build their investment portfolios with passive income from real estate. Read our article: 9 Reasons why investing with Reinvest24 is better than buying your own real estate.

The perfect short-term rental property to invest in

Our team decided this would be the perfect opportunity to invest into a profitable short-term rental property, which could be listed on rental platforms like Airbnb. We put a lot of focus on selecting the perfect rental property for investments in terms of layout, size, and its location within the building, on the quiet side, with nice views towards the backyard.

Investment case: 8.3% net yield from rent

After successfully funding the property with P2P investments, worth 79,076€ in total, we managed to furnish the micro-apartment and we also hired a property manager to take care of Airbnb bookings. The property was successfully rented out during short-term from April until September 2019, earning our investors 8.3% net return from the short-term rental yield.

Why did we sell the property and exit the investment?

While enjoying the monthly rental yield, we were able to identify many additional potential risks:

• Property managements costs
• Liquidity issues
• Competition within the building

Having just one apartment in the building meant our small scale operation was costing us more in terms of labour. For example, cleaning just one micro-apartment would cost 10-15€ instead of 5€ when hiring someone to clean 20 apartments at a reduced price, but with more earning possibilities. This is usually the case with economies of scale – higher output, lower costs.

We had many performance risks and the chance to sell

Despite the good performance, the property was expensive, and if the holiday rental market would tighten, we would start losing liquidity. Another factor that we took into consideration included the high-level competition within the rental building itself, including larger and even cheaper rental apartments. Luckily, we found a buyer and sold for a profit.

Investors made over 8% capital gain in just 6 months

Considering all the risks, our team decided it was time to sell. Reinvest24 found a buyer for this investment property, selling with over 8% capital gain. All in all, our P2P investments into this property earned 8.3% rental yield, which was paid out monthly. Investors also gained from 8% capital gain over 6 month, which would become 16% annual capital gain in total.

Our total combined return exceeded our expectations

Indeed, our initial estimation for capital gain was 3.1%, based on modest expectations and the current market’s performance. Reinvest24 likes to play it safe when it comes to numbers. It is our policy to under promise and over deliver as a result. Hence, we are always conservative with our estimations. No unrealistic numbers, and no excuses, just profitable P2P investments in property!

How much did investors make from P2P investments in this property?

In conclusion, the investors who invested into this property received 24.3% return on their P2P investments in real estate. Reinvest24 exited the investment in September 2019. By now, all our investors have already received their share of the profits, paid out directly to their accounts. We often highlight our 14.6% returns, but in this case it was much higher.

How much can I make from P2P investments?

Our P2P investments in real estate start from 100€ per investment. However, you can invest as much as you like and in as many different properties as you like. This way, you will diversify your investment portfolio and ensure long-term capital growth. Read our article: Where does investing 100 euros per month get you or how to become a millionaire?

Don’t miss out on our next P2P investments in property

Reinvest24 is a leading real estate investment platform, founded in Estonia back in 2017. Our P2P investments include investments in rental, commercial and development properties. Our real estate investment platform has helped over 5500 people in over 50 countries become online property investors. Why not join them? Check out our available properties to invest in real estate starting from 100€.

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