The “fractional” investment model is popular among people who can’t afford a home deposit, attracting interest from both young aspiring buyers and larger investors.
Soaring house prices and high interest rates are driving would-be property owners and larger investors to “fractional” investment, where they buy smaller shares in properties rather than buying them outright.
BrickX, which began life as a startup appealing to Millennials aiming to get on the property ladder while saving for a home, Khaled El-Katateny, the managing director of financial advisory firm Kelkap, which has helped more than 1000 clients invest through BrickX, says he has also seen a “younger demographic start to come on board”. He says most of his clients are investors keen to avoid high barriers to enter the property market and an “eggs in one basket situation”.
CoreLogic’s Tim Lawless says anyone with a diversified fractional portfolio will likely see returns which mirror the overall property market.Galvez says investing in fractional property and equities through the ASX is like “chalk and cheese”, but since 2019, BrickX has reduced its transaction fees to 0.5 per cent when buying or selling. He says fractional investment offers more liquidity than conventional property investment.
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