The HomeBrik Profit Participation Method allows
passive investors to profit from an injection of capital into residential real
estate at the same rate as the property owner. HomeBrik’s financial
instrument, Profit Participation Agreement (PPA) enables property owners to
sell a fractional interest in their properties to investors. The owner and
investor(s) share future profits in the property, through price appreciation and
The PPA has two parts. The first part of the agreement assigns a fraction of
future property profits, appreciation and rental income to investors. The
second part works like a home loan and provides investors with earnings of 2%
of the invested amount per year. There are no monthly payments, however, as
all interest payments accrue through the term of the agreement and are paid at
the termination of the agreement (property sale or end of the agreement term).
PPA gives investor rights to the profits to the percentage of the property
value invested in and the same percentage of the rental income. The property
owner does not have to perform property improvements to obtain investment.
However, the investor receives a right of first refusal to purchase the
property when the property owner decides to sell it or at the end of the PPA
To see examples go to the investors page.
More about the HomeBrik PPA
The primary purpose of the PPA investment is to pay off the existing
mortgage and other liens, if any. The remaining money can be used for any
purpose, including property improvements, creating additional income,
education, or other personal reasons.
The minimum PPA amount is $50,000.
There is no limit on the maximum property value that can qualify for PPA
There are no more than five investors per PPA, each with a minimum investment of $25,000.
All investors share the profit rate of property owners.
The sum of the investment amount and other liens, if any, cannot exceed 75%
of the appraised property value.
The length of PPA (the term) can be from 3 months to 35 years. Property
owners might be required to put a percentage of the investment amount for
future property repairs in escrow.
The PPA investors receive a percentage of the property rental income, if
any, equal to the ratio of their investment to the property value. Rental
income payment can be made monthly, annually, or it can accrue and be paid
at the end of the agreement term or when the property is sold.
The use of PPA protects property owners from the change of their tax base
that occurs if the investor becomes a co-owner of the property through
equity sharing. Protection of the property owner’s tax base is an essential
advantage of using the Property Participation Agreement. Investor acquires
future profits to real estate, but not real estate itself.