Given my background in real estate and allied investments, I have found the industry participants to be totally closed to change in basic business models. The objective behind starting up Novyy was to redefine real estate ownership and asset management models and use technology as a leverage for inclusion. Our vision for Novyy is at the cusp of multiple industries such as Prop-Tech, Asset Management, Hospitality, Fintech and Wellness.
Novyy is ‘new’ in Russian. We stand committed to taking a new approach to age-old models in this industry. We strive to change the game in more than one asset class over time.
Our core objectives are:
- To expand the real estate investment space, which is currently limited to a very small section of the modern society – mainly owing to the minimums in most opportunities
- To reduce costs and increase efficiency – i.e., better use of space and capital
Here’s how we are beginning to deliver on our objectives:
Traditionally, holiday homes are meant for the wealthy only. The decent ones are expensive to buy and to maintain, and buyers don’t use them year-round either. With Novyy’s Co-Buy, we are making premium holiday homes across Europe available to larger section of the society by making it affordable to own and to maintain.
This is an amazing opportunity for the mass-affluent to buy-in a fraction of a property aligning with their desires, budget and usability. Our Co-Buy Homes are premium properties in exclusive locations meant for a high-end holiday experience.
These are free-hold properties held in UK Limited Company structure providing a potential for uplift in investment value. The customer’s entire experience of buying and enjoying their home is now stress-free. They need not worry about managing or maintaining their property, or regret buying a property and not using it fully.
The objective behind Co-Buy is to build a brand that combines real estate ownership and high-end hospitality.
Very similarly, Buy-to-Let has largely been accessible to large family offices or Private Equity Funds who have the ability to write multi-Mn £ checks. We decided to change this! Novyy is curating property blocks solely meant for letting. These apartment blocks come with captive rental market, a high rental yield and steady flow of tenants because of their strategic locations or purposes. The properties will go on to enjoy a significant upside in the prices in the years to come.
While Co-Buy is largely a Europe-centric offering, Novyy’s Buy-to-Let business is targeting emerging markets where there is more potential owing to a larger population and significant uplift in socio-economic status every year. The 2 products combined present Novyy with an opportunity to become a leading global brand in the real estate marketplace.
What have you learnt so far?
It is just the beginning, and we learn something new every day. Every conversation, every potential customer, every potential investor – there’s always something new to learn. I would summarise our learnings across 3 key categories.
Having spoken to tens of potential customers who’ve visited our website and expressed an interest, we’ve learnt about preferences of British consumers. For example, most consumers would like the 3 following attributes in their holiday homes.
- Location – Over 2/3rd prefer Mediterranean, (i.e., Greece and Cyprus) while the rest prefer the Iberian region (i.e., Portugal and Spain).
- Size – Over 60% need at least 3 bedrooms and ample living space
- Features – Almost everyone would like to have a swimming pool in the property and be within a mile of the seaside
Over 3/4th of the enquiries was from customers in the age bracket of 40-55 years old. And most of them had 2 or more children, aged at least 10 years old. This meant they were looking for relaxing holiday homes with large indoor and outdoor spaces. They are willing to put-in between £200K and £400K for the right opportunity.
At Novyy, we would like to automate as much of the buying process as possible. Customers, however, are still looking for that “in-person touch”. We hope that as we become more popular, customers will do more online than they are doing now. We are also working on building capabilities for on-demand services at all our Co-Buy locations so that they don’t stop talking about us even after they have returned home.
In summary, there is a large section of the society who can afford a £200K to £400K for a second home in Europe which they would use for 1-3 months a year. But unless they co-buy, they cannot get a property they would really love to holiday at. Via Co-Buy, they can have access to a 3–6-bedroom, premium villa with facilities like a private swimming pool, a huge garden, an exclusive location, and privacy. They can have their friends over, throw parties using our on-demand services and pay only a fraction of the buy price and upkeep costs, aligned with their usage and requirement. This means “More Value For Money”. Novyy’s Co-Buy not only elevates a family’s holiday experience but is also a viable financial investment that appreciates over time.
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What challenges have you overcome? How have you responded during covid?
Covid has had one positive impact – almost all of our discussions and viewings have been virtual, and it is now an acceptable way of doing business. This would have been nearly impossible a couple of years ago.
The key challenge has been in getting the ball rolling across multiple geographies and covid was not very helpful. We were delayed with the launch by over 6 months because of travel restrictions. But it seems to be over now with markets opening in Europe, and businesses are back in action. We look forward to commencing the first phase of on-boarding very soon.
As you can see from our website, we’ve already assembled options across Algarve, Athens, Corfu, Larnaca, Mykonos and Santorini. We are working on adding Paphos and Limassol in Cyprus, and a few more locations in Portugal and Spain. We will also add UK destinations for those who like domestic holidays.
What are your plans for growth?
My immediate focus is to assemble a great team, further enhance the tech stack and get in front of more consumers. I am confident that there is a potential to explode. The pandemic has triggered families to rethink about wellness, holidays, and investments. We fit very well with all the 3.
I am targeting £100 Mn GTV in under 3 years which is quite possible with the right locations, best deals, and adequate sales & marketing efforts. The website is already seeing good traction from new and returning visitors, and the number of enquiries coming in are encouraging. I am confident that Novyy Co-Buy will be a leading, premium hospitality brand in a few years as more consumers join the platform. We are further adding more on-demand experiences unique to each location to enhance consumer experience and referrals. We are aiming for a network effect!