Frequently Asked Questions
Property Flipping using Revenue-Based Financing (RBF)
1. What is Property Flipping?
Property flipping involves buying undervalued real estate, enhancing its value through renovation or repositioning, and then reselling it at a higher price, typically within 6–9 months. Profits from these sales are shared with our Partners.
2. What is Revenue-Based Financing (RBF)?
RBF is a funding model where Profits are shared in percentage directly proportional to their investments. Partners receive returns as a percentage of the revenue or profit generated from a project, rather than fixed EMIs or interest. Your returns are directly linked to the project’s success. This is a profit-sharing partnership. This is not a loan, hence no EMIs or Interest are paid to the investing Partners.
3. How much do I need to invest?
You can start investing with ₹25 lakhs, making real estate flipping accessible to a wide range of Partners, including individuals, professionals, NRIs, and HNIs.
Any amount over & above Rs 25.00 Lakhs is most welcome.
4. Isn't ₹25 lakhs a significant amount to start investing?
In the realm of real estate, ₹25 lakhs is actually a modest amount. For context, even a basic 2 BHK flat in Bengaluru now costs ₹1 crore or more. Our aim is to make real estate flipping accessible without requiring multi-crore investments.
5. Why aren't you encouraging contributions as low as ₹10 lakhs anymore?
Managing numerous smaller contributions (e.g., 10 partners at ₹10 lakhs each for a ₹1 crore project) becomes administratively very cumbersome. More importantly, the individual profit generated for each partner from such a small contribution would be negligible, making the effort less worthwhile & less attractive for both parties. Our current focus aims for more impactful contributions that yield meaningful returns for our partners.
6. What are my returns and when do I get them?
Returns are based on the actual profits generated from each project. Once a property is sold and all associated costs are covered, the net profits are distributed proportionately among our partners, directly reflecting their percentage of the total investment in that project. Each Project would typically take 6–9 months for completion.
7. Are Returns guaranteed?
Returns are based on the actual profits generated from each project. Once a property is sold and all associated costs are covered, the net profits are distributed proportionately among our partners, directly reflecting their percentage of the total investment in that project.
8. How is my investment protected?
Each project operates under a separate Special Purpose Vehicle (SPV) or Limited Liability Partnership (LLP), and all funds are routed through an ESCROW account for full transparency. Legal agreements clearly define your rights, profit share, and exit terms.
9. Is this legally compliant in India?
Yes. This is not a Deposit Scheme, and hence we do not offer fixed returns/ EMIs/ Interests.
Partners become registered partners in the project SPV/LLP. Our model fully complies with Indian contract, partnership, and real estate laws, and does not violate SEBI or RBI regulations.
10. What if the project doesn't generate profit?
The project not generating any profits does not arise at all. A particular project may generate less profits. However, if a project were to yield lower-than-expected profits, your return would reflect that.
We very meticulously identify and select only those projects with high profit potential, aiming to generate significant returns for our partners. Our rigorous selection process and extensive efforts are focused on ensuring profitability.
11. Why can't you offer collateral or security?
This is a Profit-sharing business model. We are entering into a profit-sharing partnership with Partners, not borrowing money.
We don’t offer collateral because our business model is based on profit-sharing partnerships, not loans or deposits. We aren’t borrowing money from you; we’re inviting you to partner with us to share in the success of real estate projects. Providing collateral would transform this relationship into a loan, which is fundamentally different from how we operate.
Offering collateral would change the nature of this relationship to a loan, which is not our business model.
12. Can one large investor take over the entire project?
Yes and No. While we technically cannot refuse a single partner, willing to offer and fund an entire project, we intentionally limit the size of individual investments. This strategy helps us maintain fairness among all our partners and ensures we retain control over project execution. Our goal is to guarantee equal treatment for everyone involved and deliver focused, successful projects.
13. Who executes the project and manages the flipping process?
Our Company Jayashree Projects & Marketing Pvt. Ltd. acts as the Project Management Consultants & Execution Partners. We manage all aspects of the project from A to Z, including legalities, property purchase, renovation, resale, and Profit distribution.
14. How is profit distribution handled?
After the property is sold and full sale proceeds are received in the ESCROW account, profits are calculated post-expenses and then distributed proportionately based on each investor’s percentage contribution.
15. Can I exit mid-way or early if I need funds urgently?
Generally, No. Each investment is tied to a short-term project (6–9 months), and you can typically exit only after the property is resold and the project completes its defined lifecycle. Early exits may be possible by transferring your stake to another new partner with the consent of all partners, subject to the LLP’s terms.
You are advised to commit only if you can hold the investment for the full project duration.
16. What are the tax implications for me?
Profits from these projects are considered income and are taxed according to Indian tax laws. A Chartered Accountant can provide specific guidance based on whether you invest as an individual, HUF, firm, company, or NRI.
17. How are properties selected for flipping?
We conduct thorough due diligence, which includes:
- Legal clearance
- Market valuation
- Local resale potential
- Cost of renovation
- Time to market and potential margins
Only high-potential assets are shortlisted.
18. Do you operate pan-India or regionally?
We initially focus on Bengaluru and nearby Tier-2 cities where we have extensive market knowledge. Expansion to other locations will follow as our investor base grows.
Our next destination will be Hyderabad & Chennai, probably in a year’s time.
19. How many projects do you run at a time annually?
We typically handle 5-8 medium-scale property flipping projects per year. Each project is managed within its own SPV/LLP to avoid overextension, maintain focus, and ensure project-specific accountability. Each project is estimated to cost around ₹3-4 crores, leading to an annual financial requirement of approximately ₹10 crores.
20. Who can invest?
Any Indian citizen, HUF, private limited company, NRI, or partnership firm can invest. Mandatory requirements include KYC, PAN, and signed agreements.
21. Can I refer others or co-invest with friends/family?
Yes. We encourage group investments. In such cases, each investor signs separately and receives individual acknowledgment and profit share.
22. Will I get a legal agreement and regular updates?
Yes. All partners will sign LLP incorporation documents and project-specific agreements. You will also receive regular updates via email, investor dashboards, and calls. Any delays are transparently communicated.
23. Why do you refer to us as 'Partners' rather than 'Investors'?
We call you partners because our model is a profit-sharing partnership, not a loan. We aren’t seeking debt, and unlike traditional investments that often expect fixed monthly EMIs or interest, our partners directly share in the project’s profits, proportionate to their contribution. This aligns perfectly with our Revenue-Based Financing business model.
24. What is this Membership that you are talking about? Why should we take membership?
To maintain the integrity and to ensure that we engage with only serious investors who share our passion, we operate on a membership basis. This approach is designed to filter out non-serious individuals and cater exclusively to only genuinely interested investors. This program helps us identify and filter genuine investors from the general public due to significant interest in our Property Flipping concept. We aim to engage with only serious and committed individuals who genuinely wish to become our “Partners & Associates” and provide the necessary “Contribution Investments” for our Property Flipping business.
25. Is GST applicable on the Flipping transactions?
For property flipping, focusing on ready-to-move-in properties with a completion certificate will generally mean no GST is directly applicable on our sale transaction. If we are flipping a property that is already completed and has received its Completion Certificate (CC) or Occupancy Certificate (OC), then GST is not applicable on the sale. I
f we are flipping a property that is still under construction (i.e., a completion certificate has not been issued at the time of sale), then GST is applicable on the transaction.
However, it is important to note that the Tax laws are inherently complex and subject to change. Depending on the situation, the kind of property that we are dealing, we shall consult the appropriate tax authorities at that point in time. In case if the authorities insist that GST has to be paid, we have to pay. Again the GST rates also differ, whether it is a affordable housing(1%), luxury housing(5%), commercial property(12%) etc.
26: What is Your Company’s core business interest here and how does your company generate revenue?
Jayashree Projects & Marketing operates as comprehensive Project Management & Execution Consultants. We function as a single point of contact, overseeing the entire Property Flipping development lifecycle from inception to completion.
Our involvement spans across all critical stages, including:
- Property Sourcing & Finalization: Identifying and securing suitable properties.
- Partner Selection & Collaboration: Bringing together the right individuals or entities for successful project execution.
- Acquisition & Legalities: Handling property purchase and registration processes.
- Development & Enhancement: Managing construction, renovation, and modification works.
- Marketing & Sales: Strategizing and executing the sale of the developed property.
- Financial Management: Overseeing sale proceeds collection and profit distribution to partners.
For these end-to-end management services, Jayashree Projects & Marketing charges a management fee equivalent to 5% of the total project cost, disbursed on a stage-by-stage basis throughout the project’s duration.
27. Are there any hidden costs involved in your services?
At Jayashree Projects & Marketing, we are committed to transparency and integrity, ensuring there are no unexpected hidden costs in our operations.
However, it is crucial to understand that certain expenses are separate from our management fee and will be charged on an “actuals” basis. These typically include, but are not limited to:
- Property Acquisition & Sale Related Costs:
- Registration charges and Stamp Duty.
- Miscellaneous office expenses at the Sub-Registrar’s office
- Documentation, Legal drafting, photocopying etc.
- Real Estate commissions for both property acquisition and sale.
- Goods and Services Tax (GST), if applicable, as per prevailing tax laws.
- Professional Services:
- All charges for legal opinions from Legal experts and due diligence documents.
- Marketing & Advertising:
- Costs associated with marketing and advertising the property.
Furthermore, any other costs that become legally payable during the project but are not currently anticipated will also be charged on an actual basis. We strive to provide a comprehensive cost breakdown at every stage to ensure complete clarity for our partners.
28. Who pays for all the Renovation/Modification expenses?
Renovation, modification, and any new construction are integral and often the most significant components of the property flipping process. Therefore, all associated costs for these activities are considered core project expenses.
These expenses are directly covered by the total project capital raised from our “Membership Network” of investing partners. When partners contribute funds to a project, their investment encompasses not only the property acquisition but also the entire budget allocated for value-enhancing improvements, including materials, labour, and professional fees.
Essentially, the funds pooled from our partners are utilized to execute these essential renovation and modification works, aligning their investment directly with the increased value and profitability of the flipped property.
29. Do you restrict the number of partners for a particular project?
Our primary goal is to meet the total capital required for each project. To achieve this, we onboard partners from our “Membership Network” until the full funding target is reached.
While our main focus is on securing the necessary investment, we generally prefer to have a smaller number of partners per project. This approach often leads to more substantial individual profit shares for our partners, enhancing the attractiveness of each investment.
30. How is your RBF based Property flipping different from a Fixed Return Scheme?
We do NOT promise any Fixed Returns. You become a Partner in a registered LLP & you share Real Profits made in a real project.
Returns are tied directly to the success of the property flip. This means your returns are a percentage of the revenue generated from selling the property. If the property sells for a higher profit, your returns could potentially be higher. Conversely, if the profit is lower your returns also could be lower.
31. What if the Project gets delayed?
In the event of a delay, our commitment remains to successfully complete the property flip. While the timeline for your repayment may be extended, your investment continues to be secured by the underlying property. We will keep you fully informed about the reasons for the delay, revised timelines, and any steps being taken to mitigate the impact. Our aim is always to achieve the best possible outcome for the property sale, which directly benefits your repayment.
32: Is your property flipping business legally safe?
Absolutely Yes, property flipping in India is legally safe, if it is conducted with proper due diligence, adherence to all applicable laws (like RERA, Transfer of Property Act, etc.), and appropriate tax compliance. We ensure that our business is fully compliant with all the applicable laws in India.
33. How is this different from a real estate investment?
Traditional real estate investment involves buying and holding property or earning rental income. We flip properties quickly and return revenue to our Partner investors without requiring you to own or manage property.
34. Is this a loan or debt-based investment?
Absolutely not. We do not raise funds via loans or offer interest-based returns. This is not a debt model. It’s a partnership based on revenue-sharing.
35. Do I get monthly interest or returns?
No. We do not offer monthly interest or EMI-like returns. You receive your share of Profits only after the property is flipped and sold directly in percentage proportion to your investment.
36. How transparent is the process?
We provide regular project updates, documentation, timelines, and photos of site progress. Full transparency is a core part of our ethical model.
37. How can I trust Jayashree Projects?
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