The app can help investors find and quickly secure single-family-rental investments in cities around the country — or world — and provides management, leasing and no-recourse, interest-free financing.
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Plotify is a web-based solution for investing in single-family rental homes.
Platforms: Browser, companion app
Ideal for: Investors, agents who work with investors
Top selling points:
- For experienced, accredited investors
- “5-click investment”
- Included property management
- Buy in multiple cities or countries
- Encourages portfolio building
Some agents may see apps like this as a threat to their value to investor clients — and it very well might be.
What you should know
You don’t need really need to know what a “plot” is to use or understand Plotify, but because the term is part of its user experience, here you go. Plot: A structure that bundles property, taxes, insurance, mortgage and property management into one convenient, transferable asset.
Like a few other alternative home purchasing and investing services on the market today, you’re buying a property from Plotify, which it secures with a deep pool of credit. The company’s goal is to remove the hassles that are unique to investing in residential homes (versus multifamily), such as securing management, the mortgage process, ROI tracking and accounting and leasing.
Plotify was built by a team of entrepreneurs who also happen have thousands of single-family rentals (SFRs) between them. One of its founders, Anish Malhotra, said that he’s “always had an affinity for products that break down barriers and democratize access to platforms that promote broader participation.”
Plotify certainly reflects that mindset.
The software offers users a scoring system for cities and ZIP codes, and it’s currently leveraging a few American cities that are known for being undervalued. Its algorithm uses 90 data points to create property risk scores and narrows a list down to, for example, 200 options per market. (That number would vary depending on the market.)
Plotify secures a home for an investor and then transfers ownership into an LLC for their buyer, specific to that home. While LLCs can invest in other LLCSs, Plotify still puts each home into its own corporation.
Investors are approved in minutes with interest-only, non-recourse 60 percent loan-to-value (LTV) financing with Plotify, at what I was told is “a good rate.”
The company then quickly assembles the investment’s operating plan and also establishes a reserve fund to help cover non-consistent expenses, which are more common, and less predictable than with multifamily investments. And, that fund dynamically adjusts as operations become more stable.
Plotify solves the initial occupancy challenges by investing only in homes already leased. It partners with regionally vetted property management partners, serving as an interface between investors and the manager.
While the mobile app was not 100 percent ready for prime time upon our demo, it was very close and being used by beta testers. It certainly looks ready.
The app quickly walks investors through the accreditation process and allows them to fund their account within minutes. Properties, or Plots, populate a user’s feed like Monopoly cards; all the information presented is clean and relevant enough to make a decision in a single screen.
Profit and loss statements are accessible, as are map views of how each plot relates to another — a nice touch when a user starts to assemble a portfolio, which is what Plotify wants to happen.
Those customers with existing properties will soon be able to load their portfolio into Plotify and hire them to run their operations. They’re calling it “Plotify as a service.”
Between the time saved from not having to search cities across the country for sound SFR investments to the built-in professional services, Plotify should easily carve itself a niche into rental property investment in the same way Robin Hood is making Wall Street as friendly as Main Street. Granted, you can’t buy in with $10.
Plotify offers investors control, a stable yield and low transaction costs.
Have a technology product you would like to discuss? Email Craig Rowe
Craig C. Rowe started in commercial real estate at the dawn of the dot-com boom, helping an array of commercial real estate companies fortify their online presence and analyze internal software decisions. He now helps agents with technology decisions and marketing through reviewing software and tech for Inman.