Can real-estate be bought in smaller affordable units instead of buying the whole chunk available with property owners to sell?
Well, the answer is YES, although there is no easy and formal mechanism to do so, in India, till now. The concept of fraction ownership of high value assets is a known territory to many investors globally. Fractional ownership gives an ability to several unrelated parties to share in, and own a high-value tangible asset which otherwise is a lot expensive if bought by individuals.
REALX has announced to launch an online platform for easy buying and selling of real estate in smaller affordable fractions. This platform will allow its registered users to buy listed properties in smaller units.
On this occasion, Manish, cofounder and CEO of REALX said, “Real Estate is a very large part of our purchases and expenses. It is because people have inherent belief in its relative stable-ness. Almost everyone is either interested to buy properties or has already done so. However, it is simply too large and too long a commitment. All other assets can be bought in smaller sizes but so is not the case with property. REALX will provide buyers an option to purchase property interest in smaller amounts and, also, facilitate swift execution through digital transactions. I think it is one more step closer towards the goals of financial inclusion and digital India that our PM has been promoting”.
Raghav, another cofounder at REALX expressed his views and said, “REALX furthers the cause of transparency in Real Estate and will benefit from recent steps that put a curb on black money transactions. Also, introduction of RERA will further create the necessary conducive environment for property investors to invest with confidence”. He added further that “We entrepreneurs can only bring solutions that ride upon the basic infrastructure provided by governmental mechanisms, and a lot depends upon having the right conducive ecosystem around it in a sector”. He believes, that the time for REALX has come, given the rapid amount of digital acceptability in the country (including land and property records etc.).
Harsh Deshmukh, an early investor in REALX shared his excitement and said, “This is a disruptive idea whose time has now come and will define how we buy, hold and sell real estate as an investment class in the future.” Dhananjay Kulkarni, another investor, who also invested in Manish’s earlier company, GREX, said “Manish and his team bring in considerable experience behind them, and, so when they met me with the idea, I almost instantly was sold to it. It is in the interest of property investors and moreover, the Real Estate sector stands to gain much from it; after all the recent blows that the sector is going through, this is one positive news for them”.
Yashwinder Singh, who has been on Wealth Management side all through his career and later joined Manish as co-founder said “It was very difficult to keep selling the same old products to investors. In any case, most of them chose Real Estate as a base investment before other investments. With Real Estate garnering, approximately 30-50% of an investor’s assets, there was hardly much movement in them or even the need to advise clients on them as these were non-liquid, bulk transactions. I believe with REALX we can help investors have better portfolio investments which can be better diversified as well”.