- Country: India
- Industry: Real Estate
- Stage: Seed
- Investment size: $200,000 / min. $40,000
Invest in real estate property trading, own an apartment in Mumbai and earn fixed monthly income.
The most successful investors know that it is best to allocate investment across several asset classes whose returns are not completely correlated with each other. Most of them have assets in cash, equities (stocks), debt instruments (bonds) and real estate. The latter asset class, real estate, is frequently under-represented in investors’ portfolios, but real estate adds an important element of stability in an investor’s returns, owing to the remarkable stability of real estate appreciation over time compared to other asset classes.
Real estate has been under-represented because good property investment vehicles have not been easily available. For many investors their home has been their main real estate investment. Others have branched out into Real Estate Investment Trusts (REITs), which have become increasingly popular in recent years. REITs have offered good liquidity, good overall returns (especially in recent years), but tend to be volatile, with returns that may vary widely year-over-year. Their other big drawback is that REIT dividend income is fully taxable at ordinary income tax rates; Therefore they are best suited for tax-advantaged accounts.
Many large fortunes in real estate have been amassed by buying and holding properties to generate significant returns through cash flow and appreciation, and by taking advantage of their tax benefits, notably depreciation, long-term capital gains tax treatment, and the ability to defer tax liabilities through the use of tax-deferred exchanges. Buying and holding properties offers some of the very highest returns, stability, and tax advantages available.
The objective of our company - @RAJIAX - is to provide investors with a real estate investment alternative to REITs for buying and holding cash flow properties with superior returns and low volatility with the all of the tax benefits of direct real estate ownership.
@RAJIAX Real Estate Investment Philosophy
While there are a myriad of successful investment models in real estate, they all share only one or both of the following fundamentals to build financial wealth:
Cash flow growth / Equity build-up
Most homeowners are familiar with equity build-up, which is driven by the appreciation of a home and/or paying down a mortgage balance over time. Equity build-up increases one’s net worth in real estate assets.
Cash flow relates to deriving rental income in excess of all of the cash obligations and costs incurred, including the servicing of mortgage debt. To the extent that costs can be reduced and rents appreciate, cash flow will grow over time.
Some of the best and most stable investment models combine both equity build-up and cash flow growth. For each property @RAJIAX offers for sale, the pre-tax gains from cash flow growth and equity build-up are added together and projected out over a period under a set of modest assumptions about property, rent, and expense appreciation.
The resultant total return on investment (ROI) is then expressed as a compound annual growth rate, or CAGR. The ROI CAGR is the best single metric for judging the investment potential of an individual property and it can be used to compare real estate investment returns to other investment classes, such as equities (stocks).
@RAJIAXseeks to achieve a 10-year ROI CAGR of greater than 36% to 48% per year over a 1-year period for its investors.
@RAJIAX offers buy-and-hold investment opportunities that seek to combine appreciation and equity build-up with cash flow growth.
@RAJIAX acquires, renovates, and sells single and multi-family residential properties in Thane and around Mumbai, usually with tenants already in place. The properties are selected with very strict and specific criteria relating to property appreciation potential, cash flow growth, and risk. We are careful to choose desirable suburban locations in good neighbourhoods away from the inner city to optimize appreciation potential.
Importantly, we focus on always providing high cash flow properties, meaning that after putting as little as 10% down on a property, the investor will realize positive cash flow, even after expenses related to vacancy, repairs and maintenance, property management fees, taxes, insurance, and mortgage payments. It is important for investors to choose structurally and cosmetically sound properties, obtain excellent tenants, and use a professional property manager.
@RAJIAX guides investors through the entire investment process. We assist with choosing the specific properties for investment, putting together the purchase contract, obtaining a mortgage, setting up a legal entity to hold the property (optional but recommended), going through the closing process, and getting pre-qualified property management in place. If an investor is pursuing properties pursuant to a tax-deferred exchange we can assist with providing a qualified accommodator.
High vacancy rates. It is simple enough: vacant properties don’t generate rents, which harms cash flow. Vacancy rates can be harmed by such factors as broken leases by tenants, a preponderance of transient versus long-term tenants, tenants who damage the properties before vacating (extending repair and maintenance time), ineffective property managers who are slow to re-lease properties when they are vacant, and damage from natural and man-made disasters (i.e. fire, flood, and wind). It is key to use an outstanding property manager to manage the properties. The property manager is the lynchpin for getting high rents, good tenants and low vacancy rates@RAJIAXis happy to provide property manager references.
Fortunately, our properties provide excellent cash flow, and therefore are not reliant on appreciation to deliver exceptional returns.
ROC - Return on Cash invested, with positive cash flow from completion
BMV - Below Market Value and immediate equity
ROI - Return on Investment, medium to long term
Our property investors benefit from strong local factors in each investment destination, providing the potential for exceptional investment profits.
Backed up by research and a massive amount of published data, we know that investment property in the currently offers outstanding opportunities for our three strategies: Maximum Income, Maximum Growth and Maximum Profit.
If you want to make above average returns over the next few years from your property portfolio, our view is that Mumbai is an exceptional investment destination during this year.
Learn more about the opportunities for profit with @RAJIAX property investment.
1. Fixed price purchasing - no 'hidden extras'*
2. 24 hour cooling off period to change your mind*
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