Are you considering an investment, or have you already invested and want to know when and how much money you will actually receive? We have prepared a short summary for you. Your total return consists of two components:
1. Rental income
It works just as if you owned the property - the only difference being that you do not have to take care of anything and you receive a share of the rent according to the size of your investment. We will send you the first payment within about two months of the property being transferred into our ownership, which happens shortly after 100 % of the target amount has been raised. We then pay you monthly or quarterly until the property is sold.
A simplified example
At InvestBay, we offer a property worth CZK 10,000,000. At the beginning of April, you buy shares for 100,000 = 1 % of the total value. You wait for the total amount to be raised from the other investors. In July the amount is raised and we begin the process of transferring the property to us. If everything goes smoothly, in September you will already receive 1 % of the total monthly rent.
2. Return from the property's sale price
This is the more interesting part. After the end of the investment cycle (which is usually 5-10 years), we sell each property and again divide the total profit among all investors according to the size of the share they hold. The final amount is not capped in any way and can therefore end up giving you a very nice bonus on top of the regular rental income. Property prices around the world continue to grow at a rocketing pace, and thanks to InvestBay you too can start earning from it.
A simplified example
In 2024, you bought a 1% share in a property worth CZK 10,000,00 for CZK 100,000. Five years later, its price increased by 50 % to CZK 15,000,000. After the sale, you therefore get back 1 % of the final amount, that is CZK 150,000. Your earnings are therefore CZK 50,000.
Example of an investment
InvestBay offers a property in Tenerife for CZK 6,600,000.
- Your investment: CZK 100,000
- Annual rental yield: 4.66 %
- Annual property appreciation: 4.5 %
- Investment horizon: 5 years
The annual rental yield is 4.66 % of the invested amount, that is CZK 4,660. The rent is paid out monthly, so each month you receive 1/12 of this sum = CZK 388.3.
The estimated annual appreciation of the property is 4.5 %. This means that the property's price increases each year by 4.5 % of the current price (the effect compounds each year). This is always an estimate; you will learn the specific sum when the property is sold. If the price were to grow by more than our estimate, you will receive a share according to the actual growth, which could be, for example, 6 % or 8 %.
You can look at the distribution of payments for this example in the chart. The final payment (CZK 129,272) is in reality split into two - the initial investment of CZK 100,000 is returned (not shown in the chart) and to it is added CZK 24,612 as the return from the sale and CZK 4,660 as the return from the rent. An investment of CZK 100,000 can therefore grow over 5 years to CZK 147,918, increasing by roughly a half.
In this particular case, we counted on a higher return from appreciation than from rent. In the next chart you can see the distribution between the two components of the return.
This property therefore earned investors more on the final appreciation. However, we always try to also offer properties where rent makes up the higher share. For such projects, a longer investment horizon is then advantageous.
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