Fractional investment options have never been this accessible! Imagine home ownership in your reach and a wealth-generating stock portfolio in your future. Thanks to fractional real estate investing options becoming more common and easier to achieve, especially for younger Aussie homeowners.
At Positive Income Properties we help ethical investors generate wealth from rentals and see their property value go up while also giving back to the community they live in. Read on to learn more about what fractional investments and shares can do for you today.
What Is a Fractional Investment
Fractional investment means that you own a portion of the asset. Imagine the house asset to be like a cake that you can cut into smaller slices. As a result of your percentage of investment into the whole property asset with others making up 100%, you get a “slice” of the rental income of both the property growth and rental income. You can earn dividends and participate in appreciation at a lower risk.
Types of Fractional Investment
There are many types of fractional investments, which are:
- Fractional shares – Here, you invest in a part of the company’s stock. Mergers or acquisitions produce fractional shares because they combine new common stock with the help of a predetermined ratio.
- Fractional real estate investing – You invest and own a share of the property should you participate in fractional real estate investing.
- Fractional ownership – It basically means you can own a little bit of something without having to buy the whole thing. So, even if you haven’t got enough cash for the entire asset, you can still get in on the action and spread your investments across different things like art or property.
Benefits and Cons Of Fractional Real Estate Investing
Benefits
Fractional investments make it easier for those who have less savings to participate in the property market and to attain their own investment without breaking the bank.
With fractional real estate investments, you can own a portion of properties in a high-growth location that would otherwise be above your means.
You can easily get more investments across different properties. If you want to diversify your financial portfolio, fractional investing can be helpful.
You can own a slice of a property, rent it out, and watch the rental income roll in. Just check the rules and agreements first, but it’s one way to make your money work for you.
Cons
There are many variables that affect these types of property investments, like interest rate changes, conditions in the local market and even economic downturns.
You have limited control on how the property is controlled as you don’t own all of it.
Selling your fractional shares is time-consuming especially if the market is declining, however, with the right professional advice you can navigate this with confidence.
The performance and stability of a prospective platform can impact your investment; fortunately, we can help you choose a reputable platform!
Building Your Wealth with Fractional Shares and Investments
- Property value appreciation – The value of your property rises over the years. Many variables also affect this, ranging from location, local economic conditions and property improvements. With fractional investment, you can enjoy regular dividends and watch your investment climb.
- Passive income generation – You can use the residential properties you partially own to help generate passive income and more financial security.
- Portfolio diversification – Diversifying your investment portfolio mitigates risk. By spreading capital across various asset classes, losses in one area can be offset by gains in another. This strategy is fundamental to long-term wealth accumulation.
Choosing Your Platform For Fractional Ownership Well
- Do your due diligence – Research thoroughly the conditions and deals offered to you before committing. This includes factors such as minimum investment account, transparency, track record, fees and other dues.
- Compare and contrast with other deals – You deserve the best possible deal out there. Find out the other deals that other potential platforms also offer and discern which of your prospects will best suit your needs and current financial situation.
- Evaluate costs and fees – Evaluate the fees and costs linked to your investment; these can be management and maintenance fees, and others. Choose the one that gives the best value.
- Exit strategies – Having one is crucial for maximising returns in fractional ownership, as different models have various options for exiting your investment. Take into consideration the liquidity of the asset.
Explore The Potential of Fractional Real Estate Investing With Our Expert Guidance
Fractional investing makes it possible! It opens up a world of opportunities, putting financial freedom within your reach. But before you jump in, it’s smart to chat with the experts. That’s where we come in! We’ll guide you through the process, find the best properties, and even help manage them. Ready to explore? Book a call with us today!
Gil Elliott is the Managing Director and Founder of Positive Income Properties. Gil has a rich background in business consulting and property investment. All of these he gained in his nearly four decades of experience in the real estate and marketing industries.
