Fractional ownership is our unique approach to enable investors with smaller capital buy into income generating properties. It's bite-sized investing for new investors or those who would want to systematically accumulate property interests instead of putting all their eggs in one basket. Each of our properties are structured in a SPV and each such SPV has 4 shares on offer - this means you can own 1/4th or more of a deal you like.
Buying Property fractions of Novyy properties is hassle-free ownership unlike going for a Buy-To-Let yourself and taking on management and maintenance hassles.We'll take care of all the heavy lifting.
All Novyy properties are mortgage approved and funded by senior lenders. This means, you can rest assured about the due diligence and enjoy enhanced return on equity because of our funding structure.
Novyy usually engages on properties which are already rented, or an agreement has been reached, which will commence on closing. This means, your money starts making money right away.
Buying property on Novyy is a seamless experience. Requesting access and verifying KYC-AML takes less than 5 minutes. Browse opportunities, request allocations, sign agreements and wire transfer your purchase price.
Get 8% per annum on your capital invested, transferred to your bank account quarterly.
Get 25% of the upside achieved on the property's capital appreciation at the point of sale or refinancing.
Get 75% of the Net Operating Income from the property, transferred to your bank account quarterly.
Get 75% of the upside achieved on the property's capital appreciation at the point of sale or refinancing.
Fractional ownership represents our distinguished strategy to empower investors with limited capital to partake in revenue-generating real estate ventures. This method facilitates incremental investment for new investors or those who prefer a diversified approach to accumulating property interests, rather than consolidating their resources into a singular asset. It is just like owning shares in publicly listed companies like Apple or Barclays.
Different platforms across the world use different mechanisms but it all leads to individuals buying in a share or a fraction of a property, thereby owning a percentage of the property and its proportionate benefits. Ownership may be structured through legal entities like Limited Companies and LLPs in the UK, or LLCs, trusts etc. in other countries like the USA. Investors typically share costs, income, and responsibilities based on their ownership share.
Novyy’s Fractional Ownership proposition is built on the thesis of fixed income. We only engage in rental assets. Each property is held in a UK Limited Company and is fully compliant with relevant laws and regulations. We then offer 4 shares of each company to individuals who wish to participate in rental incomes and capital appreciation, while we take care of the asset management. We have eradicated most of the issues with fractional ownership in this model. For example – fractional ownership of holiday homes creates friction among fraction owners about usage. Hence, we do not engage in usage assets on our platform. Similarly, providing a full asset management service ensures that individuals do not have to share any responsibility of day-to-day management of the assets. See our Portfolio page to learn more.
Fractional ownership can be applied to various types of real estate, including vacation homes, luxury condos, commercial properties, and even large-scale assets like resorts or vineyards. However, at Novyy, we focus on rental properties, especially student HMOs in the UK.
Novyy structures individual ownership by way of issuing preference shares in UK Limited Companies with a fixed coupon rate and an added dividend distribution option. Each of our properties are held in UK Limited Companies (Special Purpose Vehicles or SPVs) and each SPV has 4 preference shares for individuals to buy-in.
The purchase of a share is governed by a Share Purchase Agreement and the Articles of Association of the Limited Company. It is similar to buying shares of any company globally.
We engage in HMOs/multi-let properties that are strategically located near tenant pools (like Universities) and have a demonstrated trading history. For example, we own and operate over 50 student rooms in CV1 area, within 10 minutes walking distance from Coventry University. Visit https://www.novyy.com/portfolio to view our current portfolio of assets.
Property is a long-term investment instrument, and we recommend that individuals do not enter the property market for making a quick buck. On this thesis, our share purchase agreement lays out a 5-year lock-in period. We recommend investors to have a lifetime approach to property investing because with time passing by, the rental income on the capital invested grows significantly which is unattainable if you exit and try entering again.
The share purchase agreement lays out a 5-year lock-in period. However, if you wish to sell your share during the lock-in period and you have a buyer in hand, please contact us for the transfer process.
The Fixed Income Option at Novyy is a medium-term quasi-debt investment strategy which carries an investment horizon of circa 5 years in line with the lock-period mentioned in the share purchase agreement. It can help an individual plan an investment based on anticipated life events such as education expenses or a world tour. For example, if you bought a share in a property in 2020, you can exit your investment with your share of the capital gain in 2025. This option offers a fixed rate of return to the shareholder whereby the risk management lies entirely on us. Unlike other fixed income products, we also offer a nominal share of the upside to the shareholders.
The Equity Option at Novyy is a medium-term equity investment strategy which carries an investment horizon of circa 5 years in line with the lock-period mentioned in the share purchase agreement. It can help an individual plan an investment based on anticipated life events such as education expenses or a world tour. For example, if you bought a share in a property in 2020, you can exit your investment with your share of the capital gain in 2025. This option offers a variable rate of return to the shareholder based on a profit-sharing mechanism. Unlike other equity products, we do not charge a fixed fee. Instead we charge a share of profits, both on operating incomes as well as capital gains. This keeps our interests aligned with our shareholders.
Each property has its own income and expenditure projections, so you can carefully examine the potential earnings from your share in the property. See the estimated RoE section (Return on Equity) to calculate how much you could earn. For example, if the Est. RoE on a property is 10% and the fractional ownership costs £50,000, you could look at earning £5,000 pre-tax from your share in the property. Bear in mind, this earning keeps going up as rents increase. As in the case of Coventry, per week rents were £50-£60 in 2015-16 and are now well over £100. In such a case, if your share in the property was earning £5,000 in 2015-16, the same share will earn over £8,000 now which is much higher RoE than your initial entry yield.
Yes, every property held in a Limited Company has its own mortgage. The mortgage helps enhance the RoE (return on equity). For example, if a property price is £500,000 and the rental income from it is £40,000, the property yields 8%. Now, if we have a mortgage of £350,000 at an interest rate of 6%, we pay an interest of £21,000 leaving an income of £19,000 for individuals against an investment of £150,000 representing a return on equity of over 12%.
The Limited Company (the SPV) which owns the property and receives the rental income, services the mortgage payments from the rental incomes before paying an income to the fraction owners of the property.
The annual expenses of maintaining the Limited Company are nominal and include accounting expenses as well as government fees, if any. Currently, these costs are limited to under £50/month.
Novyy has an in-house team to take care of the day-to-day management and operations of the property. For example, we have a Portfolio Manager based in Coventry who manages all the assets in Coventry.
Void periods are a risk that comes with every property and affects the income negatively. Novyy looks for properties that have an income coverage ratio of over 1.5x which means that fraction owners do not lose any money upto 33% void period. Most of our properties have an income coverage ratio of between 1.5x and 2x.
Buying property fractions at Novyy is as simple as saying 1-2-3. Browse the available opportunities online, go to your account dashboard and “Request Allocation” for a property that you like, and you will receive a share purchase agreement to sign. Once you have digitally signed it, simply transfer the share purchase money and your interest will be recorded in the share register on the Companies House.
Our fully powered account dashboard gives you all of the updates relating to the property where you own a share. You are also welcome to have physical visits to the property – please remember to notify us ahead of time as the property may have tenants who need to be notified in advance (as per law) ahead of any inspections.
Unfortunately, we do not. The current offerings of fractional ownership (as the name suggest and includes “ownership) is an equity investment. Equity investments by the nature of it, do not provide income guarantees and are subject to market risks, hence the rewards are significantly higher than debt instruments which guarantee income. If you’d like debt instruments, we may have offers from time to time.
Fractional ownership is not regulated per-se but the regulation comes around the structure of the ownership. For example, we use the Limited Company structure and thereby regulated by the Companies Act 2006 and overseen by the Companies House.