It’s no secret — real estate is not nearly as accessible as it was for our parents and even our grandparents. Especially in Vancouver, the price of ownership is high, and for many millennials, owning property or a piece of real estate is unattainable.
According to a study done by Generation Squeeze, young Canadians in Vancouver need to save for 27 years in order to have enough money for a proper down payment — that’s more than five times as long as our parents.
The study also noted that even though COVID-19 has tempered the housing market, the housing affordability crisis will still be in full swing when the pandemic is over. Pre-COVID, more than half of the people under 30 living in Canada’s major cities spent 30% to 50% of their monthly paycheques on rent. Not only does this leave very little room to save for things, such as a down payment, but now that the pandemic has hit, this percentage has increased for many.
This is why addy, a real estate crowdfunding platform, is making investing in real estate more accessible by reducing barriers to entry. And all it takes is $1.
So how does addy do it?
It’s impossible to cut the high costs of the market. Instead, the company’s mission is to redefine what it means to be a homeowner, while providing younger investment seekers with a new avenue into the game.
First, addy does their due diligence by scoping out the properties with the most potential to provide the highest return on investment (ROI). Once these properties have been identified and approved by the executive team, investment committee, and Board of Directors, they’re broken down into investment units starting at $1.
On launch day, addy releases the property on their platform, and qualified members have the opportunity to purchase as many shares in the property as they desire. Investors who have bought in on a specific property can make money from rental income in the form of distributions or as a lump sum when the property is finally sold.
The first property launched by addy is located in Vancouver’s charming Trout Lake neighbourhood; it was sold out to 305 investors, the lowest investment being $1 and the largest being $95,000.
This crowdfunding investment model reduces (but doesn’t eliminate) the overall risk, while giving millennials and Gen Zs an opportunity to get some skin in the game at a price point they’re able to afford. It also means investors aren’t responsible for managing tenants and other logistics associated with the property.
If you’re already getting out your pocketbook, addy is launching its next investment opportunity (only available to BC residents over 19 years of age) on August 11, 2020, with a minimum investment of $1 and a maximum investment of $1,500.
This commercial property is a free-standing building with more than 2,100 sq ft of retail space located in the heart of Chilliwack, BC, on the southwest corner of Airport Road and Yale Road. Currently, the space is occupied by Starbucks and features a drive-thru plus 12 owned parking stalls.
According to addy, the estimated timeline for return on your investment of this property is approximately five years. Any appreciation will be paid out at the end of the term, and investors can expect annual distributions from any excess cash flow.
If you’re interested in investing in this Chilliwack property or staying up-to-date on addy’s next property announcements, sign up for a free addy account wallet so you’re ready to invest when the right property comes along.