Update as of 14 February 2020: The platform has changed the way they are operating, which will go live in March 2020. I’ve updated their operating model in a separate post and kept this intact for record purposes.
A few months ago, I wrote about what Partbnb was, a fractional investment platform for regular folks like us to get into the vacation rentals business. At the time, it was really new, and there were only 3 properties listed in the Bahamas.
We’re now into June, and they’ve since added New Zealand properties into the mix, and have started paying out dividends/income on properties that have been rented out in the market.
So, given this is a side hustle site, let’s dive into the numbers!
Based on this blog post, the property in question is Palmetto Place in the Bahamas.
So, to buy a part of the property, it will cost you $34. Again, as a quick recap, the way Partbnb works is, you, as an investor, buys parts of a property. The platform then uses the funds to purchase the property, renovates it, lists it on Airbnb, and then shares in the profits with the group of investors owning parts of the property.
Verification of property on Airbnb
Naturally, upon reading the blog post about the income payment, I had to do some basic snooping and make sure the property is actually listed on Airbnb.
Lo and behold, here it is, the Palmetto Palms on Airbnb. Location, photos and average pricing checks out with what the Partbnb site advertises.
Reviews have also been really positive, which is great.
Palmetto Palms Returns per part
Let’s break down the numbers. It costs $34 to own a part of the property. Based on the first income payment blog post, income per part was $0.2174.
If we extrapolate that by just doing a simple 12 month projection at the same average nightly rate and the same occupancy, this is what we’ll get.
7.67% annual yield on a vacation rental property, without the hassle of huge capital outlay and active management of the property. I’d say that’s a pretty good deal, wouldn’t you?
Don’t forget, on top of rental income, you will also benefit from capital growth! You can also opt to sell your parts within the platform after a holding period of minimum 6 months.
Now you don’t have to hold a huge capital to invest in a vacation rental property.
Disclaimer: I don’t currently participate nor am I involved in the business. Though when they open this up internationally, I’ll definitely be open to investing.