Reinvest 24 – invest in rental properties in the Baltics

Reinvest24 is a relatively new marketplace from Estonia which I will introduce to you now in some depth. I found the platform during their softlaunch last summer. At that time there was not too much going on there what should change now. The platform is open to investors from all around the world.

Basic information

Reinvest24 was founded in 2018 through experts in the field of real estate, It and finance and is located in Talinn. According to them they have more then 10 years of experience with property development. Firstly the team developed and managed the projects as a kind of private fund. As the number of realisable projects increased they decided to offer access to this asset class to private investors (minimal investment 100 Euro per project). Not only the monthly paid yields are exciting, the type of investments is as well. You can be shareholder of a property and benefit from monthly rent payments plus participate in the value increase of the property. The properties will be revalued periodically or after a milestone in the development is reached. In future there will be a secondary market in place where you can sell your shares over or under actual value. However the main focus of Reinvest24 is to hold the properties longterm and generate passive income from renting.

Current and past projects

Momentarily there are two projects open for funding (details you can see in the project description), one with a fixed interest rate (14% annualy with a duration of 9 months). This project was published on the platform to give new investors more options to invest at the beginning. The second project is a partially renewable rental property which already generates rental income (I am in this project as well). Projects like this are preferred by the marketplace. If the team sees good opportunities, they will add different types of projects in the future (like the 14% fix rate project).

If you take a look at the properties page, you will see there are already two projects labeled with “exited”. This means the properties were already sold. These projects were never open to public, the team just processed these two for testing purposes through the platform. Hereafter there will only be limited exits on good offers, and only if the shareholders are ok with that.

Fees for investors

Per 100 Euro invested you get a number of shares of a property. Two percent of your investment is deducted as fees (applies as well for secondary market purchases, selling is free though). This means of every 100 Euro invested, you get 98 Euro worth of shares. Sounds expensive at first sight, but in comparison to other platforms this can be seen as moderat. Furthermore, the yields should compensate for the fees really quickly. The marketplace as well needs to make some money to operate. As already said the platform takes the 2 percent on investments and charges one tentht of the rental income for manageing the properties. In my opinion this is okay.

Investment structure

The whole development project is processed through a SPV (Special Purpose Vehicle), which represents the interests of the investors. This SPV is just a legal person, so basically a company (I am no lawyer, so please excuse the generalisation). By investing you do not get a share of the SPV, but directly from the property, which will be managed by the company. Basically this is the same structure used byProperty Partner, one of the bigger property marketplaces in the United Kingdom. The other possibility would have been to found a new SPV for each new project and give shares of the SPV to the investors. This is costly and not profitable to do for every 100 Euro invested, so not really an option. As it seems we will just have to trust the marketplace that this structure will be used in our best interest. I do not want to overdramatize this issue. Remember that with most p2p investments we do not get more then a contract in pdf and a promise to get paid. An advantage of this structur is that every project is independent, so if some problems occur with one project, it has zero impact on the others.

Finally..

I like the concept of Reinvest24, as I exactly missed the possiblity to generate rental income in the Baltics. It is something different and the team seems to be very motivated. I was in contact with the CEO Tanel Orro over the last weeks and he answered all my questions in detail. You can contact him through the emailadress on the platform. Maybe this is necessary as there is not that much information available on the website as I’d liked, but they are working on it. Follow me to Reinvest24.

A quick look on 3 new platforms

Today I decided to shortly introduce three new platforms to you. Of course, you should have in mind that one blogpost is way too little to describe all three platforms in a detailed way (particularly because I only registered on two of those three during the last days). This is the reason why you will only get a short introduction. A more detailed report will follow during the next days and weeks. So, let’s start:

Reinvest24 – Real Estate among the Baltic States with rental income

I always asked myself why there are no marketplaces in the Baltic States which allow investors to buy real estates and rent them. In Great Britain this kind of model is very common. That is why Reinvest24 is in its basic structures very similar to Property Partner. It is a very young platform and therefore open to investors only for a couple of months. I am already part of a project and received my first rental income previously. Concerning the second project I already placed a bid, but it will take a moment until it is financed completely. I will write a more detailed info blog for this platform during the following days. Before that you should take the chance and look a bit around. Via this link you can directly get to Reinvest24.

Bondster – P2P from Czech Republic with Buyback and Cashback

Like I mentioned before: this is a platform from the Czech Republic where you can invest Czech Crowns and Euros (here is a report concerning the development of both currencies). There are different kinds of loans you can find. The platform provides buyback in an exclusive category, as well. Self-explanatory, the buyback grasps after 60 days. But there is also an option to get out of the loan (like Envestio). Of course, you will have to pay a fee in this case. I am not sure yet who is the owner of this platform, but I saw that there is one partner of it which has a famous branding Name: ACEMA! This is a loan originator which already financed loans via Mintos. As well, this platform is under supervision by the Czech National Bank. The interest rates are with 10 per cent moderate (edit: they just added 12% loans). After three months new investors must pay an annual extra fee of 1 per cent which will be directly deducted from the interests. Like mentioned, in the first three months this extra fee will not be charged. Also, you will receive a 1% Cashback on your average investment during the first three months which you will be paid monthly – if you use for your registration the promo code 4985! This code you have to place in the field “referral code” on the bottom of the registration form. Furthermore, there is no retention. Here you can reach the platform of Bondster.

Debitum Network – P2P and Crypto made in Lithuania

This is the third platform I for today – even though I still do not have the complete view how it works. You can pay in Euros and Pounds but also crypto currencies. The crypto part will only be available after an identity proof. But you can also work in a normal way with Euro or Pound. Right now, I only see loans from Debifo (also this one we know from Mintos,
Invoice Financeing). Like mentioned, I do not have the clue yet concerning this platform, but I try to work with it by investing a small amount. Via this link you can directly get to the Debitum Network.

This is it for today! Like always please write me if you have any questions. Like mentioned, as well, there will be more detailed experience reports in the following days and weeks.

Update on Envestio – All good?

Since my last post about envestio some weeks have passed und last week the first repayment of a project was up. As with all interest repayments everything went as planned and I got my principal back on time. End of this week, the next capital repayment is on schedule. Let’s see if this will be on time as well. Frankly speaking I thought there would be some delays. with at least one project. To me it seems weird that there is not the slightest delay anywhere (pretty bizar that I would like to see delays..). Envestio replied my question why there is no single day delay with the argument that the borrowers pay slightly before the schedule we see in our dashboards… I was less then impressed with this answer as in my opinion it does not adress the source of my question. I draw the following conclusions: 1) The marketplace makes an outstanding job and has everything under control (although we should differentiate here as most problems will occur normaly between 6 and 18 months, and the loans are not live that long so far), or 2) I did not fully grasp the risks involved in these types of loans or I do not understand the business, or 3) The multiple tiers are used to generate liquidity. I will describe this point further below.

To be clear: I do not accuse the platform to be a fraud or something, for this I have no evidence (if you have, bring them to me) and it is too early to tell.. For me, it is just weird that everything seems to go very smoothly. For this reason I am thinking through some scenarios. I still believe in the old formula: Very high interest = very high risks.

Multiple tiers

It is obvious that the same companies frequently take more loans. These loans are marked with the different tier. Tier 6 means that the same borrower has 6 loans open. At the moment there is one borrower (container) with 9 live loans in the amount of EUR 650’000 hat. Possible that every loan is secured by some sort of security coming with the loan, but I find this a bit special. One could suspect here that the new loans are just extensions for older tiers. As long as the loan volume stays the same, there is no big issue. If the volume raises over time, then I have questions. Seldom there are new borrowers, mostly I see new tiers from existing borrowers.

Possible strategies

To reduce my exposere I try to invest only in one tier by each borrower and I try to catch an early one. If I am confident, I take a second tier. Further I only invest in secured debt which gives me the instant selling option with 5 percent discount. There might be other loans (subordinated) which do not offer this feature in the future, but as of now I only saw secured debt loans. Moreover I only buy loan parts with a duration higher then 3 months. This for the reason that I can sell without a loss after 3 months (assuming 20%, makes roughly 5% after 3 months). At loan expiration I can only count on 90 percent minimal payback (if the platform can pay that). If I really redeem early is a different story, but I like to have options available. Another question is if the platform has enough liquidity to provide the 95% of capital needed for early sellers, if lots of investors choose to sell. Basically this is the same as if savers call their funds from the banks. Let’s hope that we do not come to this point. As said before, it is possible that my assessment is just wrong.

Something else…

Withdrawals from the marketplace are free of charge, as long as they are higher then 5 Euro. For amounts below there is a handling charge of 2 Euro. Envestio needs to do that as lots of investors required small amounts daily and their bank is charging them for that.

For the end

Maybe I am too hard on Envestio, but I remain sceptical. I believe the marketplace earned a chance, I stay with the platform and hope for new loans. Interest rates of up to 22 percent support me with that 😉 If you decide to give it a try, use this link for registration and you will get 0.5% cashback (plus 5 Euro one time bonus) on your investments for the first 9 months.

Crowdestor now has a growing pipeline

During February I reported about Crowdestor and its Tesla project (seems I was lazy back then as I did not translate it from German ;)) the first time. Then I had my doubts about the marketplace and the Teslas as well. In the meantime someone enlightened me and told me the story behind Teslas in the Baltics. As it seems the Baltics really like Teslas and their uber counterpart, taxify, especially has a button in their app to order a Tesla as taxi 😉 I really like to learn new things (even unessentials), but more important is that the loans obey their loan schedule and pay. This is the case with the Tesla project. According to the marketplace all other projects are on schedule or already repaid.

Until now Crowdestor stood to their word and delivered the projects which they announced. Sadly there have only been a handful projects on the platform so far during the last months. Good news for us, these days seem to be over. There are two open loans at the moment. One is a start up in the fashion business, the second which was launched today is a property financeing in Riga. Currently the loans need weeks to fill, but this is not a problem for investors as interest accrues as soon as your bid is placed. Even if the project will not be withdrawn, you will be compensated by the marketplace. Really nice, but to honest, it is what a platform in this early stage needs to do to get projects funded. Good for us investors, even better that the interest rates are really good;)

A Start up, a property and a Berlin Restaurant (and more)

Crowdestor now has a good pipeline for new projects. Currently there are two loans live, the start up which yields at least 17 percent annually (and might go up to 22%, subject for that to happen are the turnover figures achieved by the start up in 2019). The second is a newly added property loan, paying 12% on an annual basis and runs for 9 months. In a week there will be a project live on the platform for a restaurant in Berlin, Germany. Somewhat special to see a German project here. I do not know if I like that really, as most German p2p marketplaces have difficulties with arrears and defaults.

Crowdestor Restaurant Projekt
Restaurant Projekt in Berlin

It looks like that the marketplace gained momentum as there should be two more projects coming in the next weeks. So there will be plenty to invest in. Sadly I haven’t got more information on these coming loans. Follow me to Crowdestor.

News from p2p land

Lendix is now called “october”

On October 31st Lendix announced that they now are calling themselves october. First I thought it was a joke, but it is real ;). Their CEO explained the reasons in an email shortly after the announcement. In France legislation that allowed p2p was set up in October 2014. Lendix was founded in October. They want to differentiate themselves from their peers) and wanted to open their name and not limit it to “LEND”ix. Last but not least the CEO said that the name does not need to have a connection with the business and gave Apple as an example. Oh and October is understandable in many European languages. Actually I liked the name Lendix, but hey, I lend my money now on october.

Peerberry does no longer belong to Aventus Group

Maybe an older story but I wanted to mention it. Ausra, CEO of Peerberry, confirmed that the platform was sold to two European citiens. You can see it inthis video (at about 3m15s). This move is a little weird at first, but it does not mean to be negative at all. I really would like to know why this happened and what the reasons are. Maybe I will find out. At the moment my funds stay where they are.

Estateguru changed its appearence

Estateguru made themselves a fifth Birthday present and has now a new web and brand appearence. The new page is not free of errors and I am not easy navigating through it at the moment. I really hope this will be improved in the coming days. Nice is the new overview of the loans and more information is visualized. This does not change the fact that some loans are overdue or under administration. But this is just natural. If there is a problem with real estate loans, it takes time to solve.

Grupeer announces new loans for November

Grupeer is a victim of their own success. Really good growth numbers in volume and investors led to a situation where lots of loans where sold out. Good for the platform, not so good for us investors. The marketplace announced that they are working on new deals and we should see lots of them in November. Hopefully they come quick…