4 ms·

Show HN: Buy Real Estate with One Click

2 points by soheil 7y ago

Founder of AlphaCap [1] here, we built a simple tool that allows anyone to buy real estate and immediately start receiving monthly rental income. We encountered a problem in the form of an endless wall of paperwork when trying to buy real estate for investment purposes. Real estate industry is still pretty outdated, there are still real estate agents who charge 3% to represent the seller and another 3% to represent the buyer, there are technology platforms like Redfin that are trying to tackle that particular challenge by charging 1% and hiring a salaried employee to represent the buyer/seller. However, buying a percentage ownership in a property still remains a difficult problem. We strive to build a platform to connect interested buyers/investors with each other to raise enough capital to purchase a property together. This way if a property is a great investment, but you don't have enough money to cover the full purchase price you can use our platform to buy a percentage of that property and allow others to invest in the remaining equity. You will then receive your share of the rental income + appreciation on your equity ownership over time. I want to thank everyone in advance for providing feedback and looking forward to hearing your thoughts and any concerns. [1] https://alphacap.ai

multani787 7y ago
Looks cool! Would you say this is similar to https://landa.app/ https://landa.app/ ?
- soheil 7y ago
  Thank you. The difference is we allow individual users to invest together in a property, we don't necessarily own the properties instead we facilitate the investment process.
sarcasmatwork 7y ago
How do you get by the laws from state to state? I know people in real estate and escrow and this has always been the challenge. The local state laws for fee, process etc. You need to work on your UX/UI. This site seems cheap imho. Like it was copied from a template, and no real work is done to it. No about, no help, no info about how you keep things secure if you do that? Nothing about the entire process. Why should I choose you? etc etc..
- soheil 7y ago
  You are right this is very much still an MVP. Trying to answer questions here before posting them on the site to make sure they are the right questions. That said, our frontend is just the tip of the iceberg we have much more involved backend including ElasticSearch instances with 60m indexed real estate listings, description, property details, etc. workers with redis queues collecting new listings and a massive database of neighborhood data, such as poverty rates, population growth, crime rates, school ratings, walk distance, demographics, property tax rates, prices and rent info.
gus_massa 7y ago
If someone tries to buy a part of a property but you don't reach the 100%, where does the money go? What happens is a property is buy, but you can't rent it? Who pays the bill of the empty place? What happens in case of a massive destruction by the tenant? > + appreciation on your equity ownership over time. Is that true most of the time? Is that too optimistic? Has a lawyer review that statement?
- soheil 7y ago
  > If someone tries to buy a part of a property but you don't reach the 100%, where does the money go? For properties that don't reach the 100% we will cover a part of the investment if funds raised is close to 100%, but otherwise will issue a full refund. > What happens in case of a massive destruction by the tenant? There is insurance on the property and there is deposit required for tenants. As part of the management process we also vet tenants before they move in. Regarding appreciation it is not guaranteed but there is a high likelihood that real estate appreciates over time assuming a minimum investment duration of 5 years.
greenyoda 7y ago
> However, buying a percentage ownership in a property still remains a difficult problem. If I want to passively invest in income from real estate, can't I just go to my brokerage site and buy shares in a REIT?[1] And wouldn't having the diversification of a REIT be safer than owning a percentage of a single rental property? [1] https://en.wikipedia.org/wiki/Real_estate_investment_trust#United_States https://en.wikipedia.org/wiki/Real_estate_investment_trust#U...
- soheil 7y ago
  Typically more diversification means lower returns, using AlphaCap.ai you can invest in individual properties whereas with REITs you don't have control over which properties your money is invested in. We also distribute a share of the monthly rental income to you from each property you invest in.
- jaworrom 7y ago
  Safer, maybe, but nothing beats truly owning real estate. I have a few rental properties, all managed by a property management co. I can cash out re-fi and roll it into another property tax free, rinse and repeat. Buy > Rehab > Rent > Refinance > Repeat. I can take the property and sell if it appreciates. I can do a 1031 tax exchange for a similar property. Or I can just continue to rent it out. Best part is I can use other people's money as leverage to buy much more property, and if the deal makes sense at the time of purchase/deal analysis, I won't be over-leveraged and will stand to make money, with multiple exits as options. After paying off the note, I can seller finance it to someone (rent-to-own) if I wish, at whatever interest rate I/my buyer deems appropriate. Can't do that with REITs, unfortunately. But in terms of being truly passive, REITs fit the bill!
jaclaz 7y ago
Other thread (only to keep things as together as possible): https://news.ycombinator.com/item?id=20739904 https://news.ycombinator.com/item?id=20739904
DirkDiggler1981 7y ago
YOU HAVE NO DECENT INFORMATION ABOUT YOU OR YOUR COMPANY ON YOUR WEBSITE. It screams laziness and/or it's some sort of scam.

2 points by soheil 7y ago

multani787 7y ago

Looks cool! Would you say this is similar to https://landa.app/ https://landa.app/ ?

soheil 7y ago
Thank you. The difference is we allow individual users to invest together in a property, we don't necessarily own the properties instead we facilitate the investment process.

sarcasmatwork 7y ago

How do you get by the laws from state to state? I know people in real estate and escrow and this has always been the challenge. The local state laws for fee, process etc. You need to work on your UX/UI. This site seems cheap imho. Like it was copied from a template, and no real work is done to it. No about, no help, no info about how you keep things secure if you do that? Nothing about the entire process. Why should I choose you? etc etc..

soheil 7y ago
You are right this is very much still an MVP. Trying to answer questions here before posting them on the site to make sure they are the right questions. That said, our frontend is just the tip of the iceberg we have much more involved backend including ElasticSearch instances with 60m indexed real estate listings, description, property details, etc. workers with redis queues collecting new listings and a massive database of neighborhood data, such as poverty rates, population growth, crime rates, school ratings, walk distance, demographics, property tax rates, prices and rent info.

gus_massa 7y ago

If someone tries to buy a part of a property but you don't reach the 100%, where does the money go? What happens is a property is buy, but you can't rent it? Who pays the bill of the empty place? What happens in case of a massive destruction by the tenant? > + appreciation on your equity ownership over time. Is that true most of the time? Is that too optimistic? Has a lawyer review that statement?

soheil 7y ago
> If someone tries to buy a part of a property but you don't reach the 100%, where does the money go? For properties that don't reach the 100% we will cover a part of the investment if funds raised is close to 100%, but otherwise will issue a full refund. > What happens in case of a massive destruction by the tenant? There is insurance on the property and there is deposit required for tenants. As part of the management process we also vet tenants before they move in. Regarding appreciation it is not guaranteed but there is a high likelihood that real estate appreciates over time assuming a minimum investment duration of 5 years.

greenyoda 7y ago

> However, buying a percentage ownership in a property still remains a difficult problem. If I want to passively invest in income from real estate, can't I just go to my brokerage site and buy shares in a REIT?[1] And wouldn't having the diversification of a REIT be safer than owning a percentage of a single rental property? [1] https://en.wikipedia.org/wiki/Real_estate_investment_trust#United_States https://en.wikipedia.org/wiki/Real_estate_investment_trust#U...

soheil 7y ago
Typically more diversification means lower returns, using AlphaCap.ai you can invest in individual properties whereas with REITs you don't have control over which properties your money is invested in. We also distribute a share of the monthly rental income to you from each property you invest in.
jaworrom 7y ago
Safer, maybe, but nothing beats truly owning real estate. I have a few rental properties, all managed by a property management co. I can cash out re-fi and roll it into another property tax free, rinse and repeat. Buy > Rehab > Rent > Refinance > Repeat. I can take the property and sell if it appreciates. I can do a 1031 tax exchange for a similar property. Or I can just continue to rent it out. Best part is I can use other people's money as leverage to buy much more property, and if the deal makes sense at the time of purchase/deal analysis, I won't be over-leveraged and will stand to make money, with multiple exits as options. After paying off the note, I can seller finance it to someone (rent-to-own) if I wish, at whatever interest rate I/my buyer deems appropriate. Can't do that with REITs, unfortunately. But in terms of being truly passive, REITs fit the bill!

jaclaz 7y ago

Other thread (only to keep things as together as possible): https://news.ycombinator.com/item?id=20739904 https://news.ycombinator.com/item?id=20739904

DirkDiggler1981 7y ago

YOU HAVE NO DECENT INFORMATION ABOUT YOU OR YOUR COMPANY ON YOUR WEBSITE. It screams laziness and/or it's some sort of scam.