BuyProperly Review: Investing In Real Estate To Grow Your Wealth

BuyProperly Review: Investing In Real Estate To Grow Your Wealth

Written by Lisa Rennie
Fact-checked by Caitlin Wood
Last Updated July 28, 2021

Buying real estate has been a tried and true way to build substantial wealth over time. But for the past 100 years, the method of investments has remained the same. For most Canadians, buying an investment property is way beyond their financial reach or not part of their future plans. Fortunately, there is a potential solution — one that adapts real estate investments to millennials that want things in a quick, easy, and reliable way. So investors can buy a stake in a high-yield property as easily as one orders a book online.

BuyProperly is an online platform available to those who wish to have a stake in the real estate game but only have a small amount of capital to invest with. Not only are you not required to take out a mortgage, but there’s also no property management involved. Instead, it’s all taken care of for you.

Let’s take a closer look at BuyProperly to help you decide if it could be a great way for you to get into the world of real estate investing. 

Who Is BuyProperly? 

BuyProperly is an online fractional real estate investment platform that allows investors to participate in real estate deals without having to buy the property on their own. As such, there are no significant upfront costs to have to cover, such as a down payment, nor the need to get approved for financing or undergo stress tests. Basically, it lets everyday investors get their foot in the door.

Investors can own a fraction of a real estate property starting with as little as a $2,500 investment. Properties are carefully chosen using an AI-driven property identification model, and tenants are vetted to ensure only top-notch renters are selected. 

BuyProperly’s goal is to simplify real estate investing for the average investor while making this type of classic investment strategy much more accessible and affordable. Once an investment is made, investors can earn a passive rental income as well as capital appreciation when the property is sold off (typically in 5 years)

Ways You Can Invest With BuyProperly

BuyProperly looks into various asset classes when seeking out real estate properties to invest in. There are various ways to invest with BuyProperly, including the following:

Current sales. With a current sale, BuyProperly has closed negotiations on a property and a deal for closing is in the midst of being finalized.

Secondary sales. Also referred to as “resale” properties, secondary sales are properties that are already closed. Current shareholders want to exit the deal for various reasons and are offering a portion of their shares for sale.

How Does BuyProperly Work?

BuyProperly uses its proprietary AI to find high-yield deals, their experts then vet these and finally, each property is inspected physically. Once confirmed, each acquired property is converted into a Special Investment Vehicle so that investors can buy or sell its shares easily online (like a listed company).

In order to ensure uninterrupted cash flow, BuyProperly engages with a host of agencies to rent these properties (unless pre-construction or non-residential) and help investors’ wealth grow with the capital appreciation but rental income too. 

They then collect rent, manage the property and cover the maintenance cost and share rental income quarterly. Each property has a planned exit after 5 years when we distribute the returns to the investors.

Investing with BuyProperly is simple and affordable. To get started, you’ll need to create a profile and include your details. Once your profile is complete, your details will be validated by a BuyProperly team member, after which you’ll be free to choose a property to invest in. 

After you’ve invested in a property, you’ll start collecting regular rental income relative to your investment much like you would with a traditional real estate rental investment. 

Types Of Property You Can Invest In

Currently, BuyProperly allows consumers to invest in residential real estate, with the possibility of choosing between a variety of development stages (for example, pre-construction and assignment).

Benefits Of BuyProperly

While you could always venture off on your own to invest in real estate, there are plenty of perks when using a platform like BuyProperly that you won’t find elsewhere, such as the following:

  • Vetted properties. BuyProperly has already done all the work of scoping out different properties and picking only the ones that show great potential for healthy returns and minimal risk. 
  • Simple to invest with. All you need is a few minutes of your time to check out the properties available for investment and make your choice. Everything else has been taken care of for you.
  • Low minimum investment. Unlike traditional real estate investing that requires hundreds of thousands of dollars to invest in, you can get started investing in real estate with as little as $2,500. 
  • No hassle. Rather than having to manage a rental property on your own, you can benefit from a steady stream of rental income without dealing with any property management tasks. 
  • Diversification. Add to your investment portfolio with a sound real estate investment. 
  • Secondary exchange. Soon, BuyProperly will allow you to trade your real estate investment portfolio like a stock through its secondary exchange marketplace. 
  • Safe investment. Your investment is backed by an actual asset of value in the form of real property. Plus, BuyProperly has rental guarantee insurance so that the full rent is covered in case of vacancy or rent payment default. 
  • Security. Your personal information is kept secure thanks to the full suite of security measures taken to protect all personal data from loss, theft, or unauthorized use.

Cost Of Investing With BuyProperly

Like any other investment, it’s important to understand all the fees involved to get a clear sense of what you can realistically expect in net profits after all expenses have been accounted for. When it comes to investing with BuyProperly, the following costs are involved:

Minimum Investment

You’ll need to come up with an upfront lump sum of money to invest. Luckily, it can be as little as $2,500. The maximum amount may depend on both Securities Commission guidelines and/or your annual household income.

One-Time Costs

There are typically one-time costs associated with buying real estate, which is no different than buying through BuyProperly. Expenses can include lawyer fees, surveys, home inspections, title insurance, and others. You will be informed of the exact costs of buying into the real estate property you choose at the time of your investment. The final price will include the price of the property price and all the one-time costs included. 

Recurring Costs

Expenses related to advertising, property management, and letting that occur on an ongoing basis will be outlined in detail for you and will be adjusted from the rental dividends.

BuyProperly Fees

BuyProperly charges a yearly management fee of 2.5% (+GST/HST) on the asset’s value, which covers the following services:

  • Maintaining and operating the BuyProperly platform
  • Finding and managing properties
  • Fund management 

BuyProperly FAQs

If I invest with BuyProperly will I own the title to the property?

No, you do not own title to the property. Instead, the title of the BuyProperly property that you invest in is owned by a Special Purpose Vehicle which works somewhat like a limited partnership company. This company is created for the purpose of owning and managing the property, and all investors who have money invested in the property own shares of this limited partnership company. 

What are the requirements to invest with BuyProperly?

In order to invest with BuyProperly, you must be at least 18 years old, but you do not need to be a Canadian citizen to invest despite the fact that the properties are located in Canada. You will also need a minimum investment amount of $2,500.

Can I withdraw my investment whenever I want? 

Your money will be locked into your investment for a default time period of 5 years. The planned exit for properties is scheduled within 3 months before or after the due date for optimal returns. That said, if you want to exit, you can always sell your share to an interested buyer before the term ends through BuyProperly’s secondary marketplace, which is coming soon.

What is fractional ownership?

Fractional ownership involves sharing the returns, risks, and ownership of real estate with other individuals or companies. Your share in the asset is based on the value of the asset and your investment. For instance, if the property is valued at $400,000 and you invest $20,000, your share of ownership will be worth 5% of the asset. 

Final Thoughts

If you’ve always dreamt of investing in real estate but don’t have the finances to buy a property on your own, BuyProperly may be a viable alternative. Not only can you invest with a fraction of what you’d need to buy a home yourself, but you won’t have to worry about managing the property either. Instead, you can enjoy the returns from regular rent collection to help you grow your wealth and diversify your investment portfolio.

Lisa has been working as a personal finance writer for more than a decade, creating unique content that helps to educate Canadian consumers in the realms of real estate, mortgages, investing and financial health. For years, she held her real estate license in Toronto, Ontario before giving it up to pursue writing within this realm and related niches. Lisa is very serious about smart money management and helping others do the same.

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