Billionaire Andrew Carnegie famously said that 90% of millionaires got their wealth by investing in real estate. While the truth is a little more nuanced than the quote itself, it is a fact that most who are wealthy understand the strength of real estate investment, and both build upon their current wealth through real estate investments and hedge their wealth against loss by owning real estate. 

When done based on logic and sound reasoning, real estate is an investment option that carries the least potential risk while also offering the greatest possible return. Real estate constantly outperforms other investments. While the stock market can suffer significant losses due to intangible reasons, real estate, especially in diversified markets with strong industrial bases, constantly experience growth. Unfortunately, for the most part, real estate investing has been limited to those with access to more significant amounts of investment capital. SpruceRoost is changing this dynamic through the use of flipvesting ™.

What is Flipvesting ™. Flipvesting is a term coined by SpruceRoost to describe a type of investment in residential properties with the intent of flipping for profit.

As with any real estate flip, there are a number of costs associated with the purchase, renovation, marketing, and sale. The goal of all residential flip investments is to subtract all expenses at the time of sale to arrive at an end profit.

One of the most significant expenses in managing residential flip real estate is financing. Primarily this is where banks, venture capital organizations, financial institutions, and high-wealth individuals are involved in the process and, in many cases, are the ones that make the most significant revenue off of a flip project. No sweat, literally. Others do all the work, and they simply make money off of lending the funds needed to make the project happen.

With flipvesting, SpruceRoost is working to change the dynamic of how financing works and to change who financially benefits from such transactions. SpruceRoost is lowering the barrier to real estate investing so virtually anyone can participate and profit. Many people dream of flipping a property for profit but are held back from making the leap by lack of access to large sums of capital, insufficient credit, lack of skills needed on the renovation and or marketing side, or simply lack of time necessary to jump into such a project and turn their sweat into equity.

Flipvesting allows the smaller investor an opportunity to own a piece of the real estate pie and profit from flipping real estate, but leaving all the work up to those who have the time and expertise necessary to manage such projects.

In short, flipvesting swaps out the traditional financer of such projects from corporate financial institutions to pools of smaller investors. Each smaller investor then owns a portion of the financing needed to move a residential property flip forward to its end sale. This means virtually anyone with any level of income can become a real estate investor. For as little as $100, you, too, can be a real estate investor.

The two primary income models for a flipvestor are loaning capital and earning a level of interest on a monthly basis, much the same way a bank would, or loaning cap ital and then taking a share of the profits at the time of sale.

With the demand for housing constantly growing and prices on a continued upward trajectory in strong housing markets, the opportunity flipvesting offers virtually to everyone wishing to benefit from real estate regardless of personal income or credit.

As with any investment, there are risks. SpruceRoost, however, works to mitigate risks by assessing each investment on multiple levels to help ensure such risk is minimized. Unlike many REIT investment products that purchase based on specified portfolio criteria often generated hands-off through the use of AI, SpruceRoost uses direct hands-on review and financial assessment that many computer-generated models can not match in terms of complexity and human understanding. AI simply can not delve into many of the qualitative elements of residential real estate that end up affecting the bottom line profits, such as actual property condition, quality of neighborhoods, local engagement with contractors to help minimize overall renovation costs, etc.

If you are interested in becoming a real estate investor, desire to engage directly in flipping property, or wish to invest in real estate but in a more hands-off capacity, contact us a SpruceRoost to discuss your real estate investing objectives. We will be happy to work with you in reaching your real estate and finance-building goals and dreams.