How Can I Earn Money On GermanReal.Estate?

The second option to make an investment return when investing in our real estate security tokens is the internet’s favorite way to make a return: Passive income. As security tokens are one of the most flexible financial products existing, there can also be a wide range of different types of passive income.

Rental income: With existing buildings, investors might receive a share of the net rental income. Depending on the number of security tokens, investors will receive a percentage. If an investor has 1% of any given real estate security token, he would be entitled to 1% of the net rental income from the underlying property. Taxed a lot better at just 25% with security tokens rather than 45% (including tax-free earnings of 1.000€ in 2023).

Fixed interest rate: As there are no tenants with newly built property developments, no rental income can be shared with investors. That is why property developments pay mostly a fixed interest (e.g. Mönchengladbach: Welcome Home). Issuers of the security token can decide on the amount of interest paid as well as how often the interest is paid to investors (monthly, quarterly, twice a year, or annually).

Profit share from property sale: If the underlying property of the real estate security token is being sold, investors can benefit from the resale value. When the issuer (e.g. FiveRocks Development SE) bought a property or constructed a property for 100.000€ and sells it for 200.000€, investors can participate from the 100.000€ profit from selling the property. Attention: Property values can also go down. A rising property value is not guaranteed.

Profit share from SPV: Properties listed on the GermanReal.Estate marketplace are mostly held by special purpose vehicles (SPV) or special purpose entities that also issue the real estate security token. When that SPV makes a profit, a certain percentage of that profit can be paid out to investors. The community portfolio token we are working on will reward investors with a profit share.

Please be aware that not all real estate security tokens that are listed on the GermanReal.Estate marketplace will pay all 4 different types of passive income mentioned above. As each and every security token is different, the passive income opportunities of every security token will also be different (e.g. different amount of fixed interest paid to investors).