certainly be offered to our platform . However , security would still be an important aspect of the offering , and we would request a mortgage bond on an asset .
WHEN FUNDING PROGRAMMES HAVE BEEN SUCCESSFULLY COMPLETED , HOW DOES THE MONEY MOVE ?
After a project has been successfully funded , the money is kept in escrow by the Realty Africa Trust . We disburse the money according to the phases of the development ( drip funding ) to protect investor funds . After each phase we send surveyors to check the building site , the progress and the materials used , before disbursing the next batch of money .
Proceeds due to the investors will flow back to the accounts of the Realty Africa Trust for disbursement .
HOW DO THE COMPANIES OR INDIVIDUALS WHO HAVE FUNDED THE DEVELOPMENT BENEFIT ? WHAT RETURNS CAN THEY EXPECT ?
It is a coomon misconception that crowdfunding is only for small amounts and non-professional investors . Crowdfunding is a way of democratising investments . In our view it is ideal for local , regional and foreign investors who want more control . You can select the project that you like instead of having to give a mandate to a fund manager .
At the same time , investing in real estate in sub-Saharan Africa is also an ideal way for professional investors to spread risk in an investment class that potentially has higher yield , but may be outside their area of expertise , or in exciting properties and locations that would otherwise not be accessible . It offers an opportunity for African cross-border and multi-currency investments that can be used by investors , investment firms and pension funds to diversify their portfolios . Investors who prefer impact investments can participate in affordable housing or eco-lodge projects .
In other words , property crowdfunding in sub-Saharan Africa offers many opportunities to all kind of investors . We are looking for partners to establish a managed fund or real estate investment trust ( REIT ) of African real estate when the pipeline grows .
IS CROWDFUNDING LEGAL IN SOUTH AFRICA ? IS THERE ANY LEGISLATION THAT COULD HAMPER THIS PROCESS ?
Legislation still has to catch up with the dynamics of crowdfunding . Therefore we have found one of the best financial attorneys in the country , Thipa Denenga Incorporated ( http :// bit . ly / ThipaDenenga ) to assist in setting up . We operate fully within the existing legal structures .
IS CROWDFUNDED INCOME TAXABLE ?
Income from crowdfunding is investment income . This is taxable depending on your local tax legislation . See http :// bit . ly / OECD _ tax for more tax-related information .
WHAT ARE THE POTENTIAL RISKS ?
Like any other investment , investing in crowdfunding entails risks . These risks vary and depend on the type and duration of the project . We give you an overview of potential risks on http :// bit . ly / investor _ risks . By applying a thorough due diligence process and drip funding with checks , and by offering security through mortgage bonds , Realty Africa is able to reduce the risk significantly .
Realty Africa has a large variety of projects in the pipeline , including luxury apartments , middleincome housing and eco lodges , but there ’ s also social housing and student housing .
For more information contact :
CONTACT : www . estate-living . co . za
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