Arun Sankar / AFP / Getty Images

Australian fintech startup BrickX’s fractional ownership model offers investors exposure to residential real estate via the purchase of “bricks”, or small portions, of a property.

Business Insider ran the numbers on BrickX in June last year. Part of its offering is to target younger investors who have felt locked out of the property market as prices soared over recent years, especially in Sydney and Melbourne.

The “bricks” are essentially tiny slices of equity in the property, which are bought and sold by BrickX users in a custom-built marketplace.

But the Australian property has hit a rough patch. After 17 months of consecutive growth, Sydney house prices declined last September — and they have continued to fall gradually since.

CoreLogic data to the end of March showed house prices in the Sydney market have now fallen by 2.1% in annual terms — down from gains of around 10% at the same time last year.

So we thought it was a good time to have another look at how the “bricks” in each of BrickX’s 15 properties are performing.

The numbers are based on independent valuations that BrickX commissions in June and December each year. 12 of the 15 properties were revalued in December 2017.

Of those 12, six revaluations related to properties that were purchased in 2017. Five of those properties were assessed to have held their value, while one property was revalued lower.

Also included in the value of the bricks are the additional purchase costs for each property, along with capitalised rental income net of recurring fees. More on that here.

The performance of the various BrickX properties is outlined in detail below, but some of the key findings are:

Six BrickX properties were purchased between January and June last year — four in Sydney and two in Melbourne. The “bricks” in those properties have posted an average return of -2.6% from their initial listing price. The bricks in the other six properties — purchased between December 2014 and December 2016 — have posted an average gain of 6.3%. The worst performer is a Surry Hills townhouse purchased in May 2017, where the bricks are trading at a discount of 11.5% to their initial listing price. The best performer was a Mosman property purchased in January 2015, which has returned 17.4%. The minimum brick prices offered by brick-owners on BrickX’s online marketplace vary in relation to their implied market value — from a premium of 8.6% to a discount of 3.7%.

Keep in mind that it’s impossible to tell how individual investors have fared on the BrickX platform, because that would depend when they bought and sold their bricks. Many BrickX users probably made money with their trades.

The company’s CEO Anthony Millet told Business Insider that despite cooling house prices in recent months, most brick-holders were investing for the longer-term.

“BrickX customers are savvy investors and recognise the longer-term stability of property price growth compared to other investments,” Millet said.

“Our customers tell us that one of the things they love about BrickX is that it empowers them to diversify their property investments in various suburbs and cities across Australia.”

“We’re also focused on using our experts to choose suburbs nationally which meet our criteria for a strong growth profile — including high rental demand, minimal potential for mass development (leading to oversupply) and a long track record of consistent growth.”

Here’s how each property is performing, starting with the 12 properties that were independently revalued in December 2017.

The current valuation is based on those revaluations, although individual bricks might trade on the market at different prices.

10 Shamrock Street, Brunswick West VIC 3055

Brick listing price (30 June, 2017): $99.00

Current valuation: $98

Investment return: -1.0%

Source: BrickX

1. Property type: Three-bedroom, two-bathroom house

2. Purchase cost (exclusive of stamp duty & other fees): $1.190 million

3. Results of independent valuation as at December 2017: $1.190 million

As at today’s date, the minimum brick price that someone was offering to sell for on BrickX’s online marketplace was $98 — equal to the value derived from the independent valuation.

4/8 James Street, Manly NSW 2095

Brick listing price (20 June, 2017): $87.00

Current valuation: $86.33

Investment return: -0.8%

Source: BrickX

1. Property type: Two-bedroom, two-bathroom unit

2. Purchase cost: $1.110 million

3. Results of independent valuation: $1.110 million

As at today’s date, the minimum brick price was $87 — a premium of 0.8% to current market value.

6/10A Challis Avenue, Potts Point NSW 2011

Brick listing price (6 June, 2017): $66.00

Current valuation: $65.35

Investment return: -1.0%

Source: BrickX

1. Property type: One-bedroom, one-bathroom unit

2. Purchase cost: $885,000

3. Results of independent valuation: $885,000

As at today’s date, the minimum brick price was $68 — a premium of 4.1% to current market value.

2/120-124 Commonwealth Street, Surry Hills NSW 2010

Brick listing price (30 May, 2017): $95

Current brick valuation: $84.09

Investment return: -11.5%

BrickX’s Surry Hills townhouse. (Source: supplied)

1. Property type: Two-bedroom, one-bathroom townhouse

2. Purchase cost: $1.3 million

3. Results of independent valuation $1.2 million

As at today’s date, the minimum brick price was $84 — a discount of 0.11% from current market value.

12/84-90 McLachlan Ave, Darlinghurst NSW 2010

Brick listing price (5 May, 2017): $57.00

Current brick valuation: $56.28

Investment return: -1.3%

Source: BrickX

1. Property type: One-bedroom, one-bathroom unit

2. Purchase cost: $840,000

3. Results of independent valuation: $840,000

As at today’s date, the minimum brick price was $59 — a premium of 4.8% to current market value.

322 Esplanade East, Port Melbourne VIC 3207

Brick listing price (9 February, 2017): $157.00

Current valuation: $155.24

Investment return: -1.1%

Source: BrickX

1. Property type: Two-bedroom, two-bathroom house

2. Purchase cost: $1.455 million

3. Results of independent valuation: $1.455 million

As at today’s date, the minimum brick price was $155 — a discount of 0.2% from current market value.

2/5 Ramsgate Avenue, Bondi Beach NSW 2026

Brick listing price (8 December, 2016): $96.00

Current valuation: $99.38

Investment return: +3.5%

Source: BrickX

1. Property type: Two-bedroom, one-bathroom unit

2. Purchase cost: $1.35 million

3. Results of independent valuation: $1.4 million

As at today’s date, the minimum brick price was $98 — a discount of 1.4% from current market value.

7/22 Ocean Avenue, Double Bay NSW 2038

Brick listing price (26 October, 2016): $95.00

Current valuation: $93.18

Investment return: -1.9%

Source: BrickX

1. Property type: Two-bedroom, one-bathroom unit

2. Purchase cost: $1.305 million

3. Results of independent valuation: $1.305 million

As at today’s date, the minimum brick price was $91 — a discount of 2.3% from current market value.

109 Albion Street, Annandale NSW 2038

Brick listing price (6 November, 2015): $97.00

Current valuation: $112.14

Investment return: +15.6%

Source: BrickX

1. Property type: Two-bedroom, two-bathroom house

2. Purchase cost: $1.27 million

3. Results of independent valuation: $1.45 million

As at today’s date, the minimum brick price was $108 — a discount of 3.7% from current market value.

4/6 Miller Street, Prahran VIC 3181

Brick listing price (5 May, 2015): $123.00

Current valuation: $123.21

Investment return: +0.2%

Source: BrickX

1. Property type: Two-bedroom, one-bathroom unit

2. Purchase cost: $1.150 million

3. Results of independent valuation: $1.190 million

As at today’s date, the minimum brick price was $122 — a discount of 1.0% from current market value.

18/5 Parriwi Road, Mosman NSW 2088

Brick listing price (23 January, 2015): $126.00

Current valuation: $147.88

Investment return: +17.4%

Source: BrickX

1. Property type: Two-bedroom, two-bathroom unit

2. Purchase cost: $1.2 million

3. Results of independent valuation: $1.45 million

As at today’s date, the minimum brick price was $144 — a discount of 2.6% from current market value.

1/159 Enmore Road, Enmore NSW 2042

Brick listing price (12 December, 2014): $66.00

Current valuation: $68.15

Investment return: +3.3%

Source: BrickX

1. Property type: One-bedroom, two-bathroom unit

2. Purchase cost: $620,000

3. Results of independent valuation: $660,000

As at today’s date, the minimum brick price was $74 — a premium of 8.6% to current market value.

Below is a summary of the three properties that haven’t been revalued yet by an independent valuer.

3 30/14 Royston Street, Darlinghurst NSW 2010

Brick listing price (13 April, 2018): $69.00

Source: BrickX

1. Property type: One-bedroom, one-bathroom house

2. Purchase cost: $639,000

3. First independent valuation: December 2018

As at today’s date, the minimum brick price was $75 — a premium of 1.4% to current market value.

3 Third Avenue, St Peters SA 5069

Brick listing price (12 September, 2017): $74.00

Source: BrickX

1. Property type: Two-bedroom, two-bathroom house

2. Purchase cost: $825,100

3. First independent valuation: June 2018

As at today’s date, the minimum brick price was $75 — a premium of 1.4% to current market value.

24 Clayton Street, Balmain NSW 2041

Brick listing price (31 July, 2017): $140.00

Source: BrickX

1. Property type: Three-bedroom, one-bathroom house

2. Purchase cost: $1.83 million

3. First independent valuation: June 2018

As at today’s date, the minimum brick price was $136 — a discount of 2.9% from current market value.

This story has been updated to highlight the results of independent valuations for the six BrickX properties purchased in 2017.

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