Assquire® provides residential property investors with accelerated and higher residential property gross rents of up to 60% better than conventional gross rents, for investors who enter into long-settlement agreements with prospective buyers. This could see an investor’s rental income skyrocket from $400 a week to $600 per week, for example, over a period of 10 years.
The arrangement allows an investor to sell a property – either one they already own, or a newly acquired property – to a buyer with up to a 10-year settlement timeframe. The buyer pays a smaller upfront deposit, alongside heftier weekly repayments, which allows them to ‘build’ their deposit over the decade-long settlement period.
For investors, the instant increase in cashflow releases funds that can be immediately deployed into other investments, said Brisbane founder Keith Burchill.
“The benefits of Assquire® are substantial for both the investor and the buyer. The investor has only one tenant for up to 10 years, with no more vacancy periods. In addition, the tenant has a vested interest in keeping the property in good condition, so repairs and maintenance are often reduced,” he said.
Under the agreement, a Queensland investor employed on a good income and selling and leasing their $500,000 investment property could be on average $210 - $257 per week better off, in today’s dollars and after tax, during their leasing period of up to 10 years, compared to their landlord position today.
This unique property investing model was designed by Burchill after he recognised that many investors are grappling with low returns and an uncertain future, whilst many homebuyers are struggling to get into the market. Assquire® was developed as a win-win solution to all parties, he said.
“Property prices have escalated but wage growth hasn’t really kept pace, which has led to what we call ‘the deposit gap’. It’s incredibly hard to get into your first home; unless you’ve owned a property and ridden the market up, you’re stranded,” he said.
“With Assquire®, we’ve come up with a mortgage alternative, not a rental alternative, which produces a win-win outcome for investors and for buyers. It’s a credible way to reduce the upfront costs for a buyer – such as mortgage insurance, stamp duty and the cash deposit – while also making sure investors are getting a good return.”
To benefit from Assquire®, investors can utilise an existing residential property or purchase a new property, but must have a minimum 30% equity in the property to potentially qualify. To gain the accelerated higher yields, and up to ten-year tenancies, an investor sells (with a settlement period of up to 10 years) their investment property today to a pre-qualified homebuyer at a pre-agreed set price. The deferred settlement produces the long-term higher rental yields and the investor remains on title until settlement.
