Start-up lets property investors access rental income early
Summary
The business has a large total addressable market, and weve proven theres significant demand from property investors who want to access their rental income.Through his platform, Mr Dinh said property investors had applied for more than $2 million in advanced rent each month.Mr Dinh, who would not reveal the size of Futurerents loan book, said it had a high rate of approval.We deliver a simpler experience for property investors, and its not tied to their loan to value ratio, he said.Most of Futurerents clients choose to access a full years worth of rental income in advance, and then pay it back over three years, paying the 6 per cent each year.Most of its customers only own one investment property, and their biggest challenge, Mr Dinh said, was accessing capital to keep growing their portfolios.Weve asked investors what they would rather: $500 a week, or $52,000 in advance? For most property investors, getting up to two years rent in advance is a no-brainer, he said.Since the market peaked, housing values have dropped 3.3 per cent in Sydney and are down 2 per cent in Melbourne, according to CoreLogic.But despite the pressure on home owners, Mr Dinh said he did not expect the downturn to affect real estate investors.Investors have been more insulated from the interest rate increases than owner occupiers because their costs have been offset by increasing rents, he said.I expect theres still going to be a lot of demand from investors, especially when they look to certain markets with great rental growth, infrastructure spending and the opportunity to positively gear property in an inflationary environment.Rental prices have surged 10 per cent nationwide in the 12 months to June.OIF partner Jerry Stesel said the business had the potential to reimagine how property investors create wealth.Futurerent has identified that simple and affordable access to capital is the biggest barrier preventing property investors from creating wealth, and they have developed a groundbreaking solution, he said.By giving property investors the option to use a streamlined digital process to unlock their rent, Futurerent has created a new financing category.