Ownership of mortgages with the flexibility of renting
Gypsy provides an ecosystem in which renters become investors the longer they stay in the network renting.
How it works
Gypsy's rent-to-own model functions very differently than traditional rent-to-own homes.
Traditional Rent-to-own
You rent a home for a certain amount of time, with the option to buy it before the lease expires. Rent-to-own agreements consist of two parts: a standard lease agreement and an option to buy.
Gypsy's Rent-to-own
A portion of your rental payment goes towards investments in Gypsy homes. These investments compound the longer you hold. Gypsy also uses down payments as an investment for the renter.
How compounding rental income works:
Gypsy vs Renting vs Mortgage
Comparisons
Feature
Gypsy
Renting
Mortgage
Gain ownership
Move Effortlessly
Responsible for Maintance
Upfront costs
Tax incentives
Payments change
Economic performance
To determine the economic performance of the three options, we took a hypothetical $1M home.
These results are assuming these monthly costs:
Gypsy
Assumptions
30 Years
$4500 a month for base rent
$675 to Equity
$5175 a month total cost with no price increase
Using compounding rental income
10% increase a year (home appreciation + rental income)
Renting
Assumptions
30 Years
$4500 a month with no price increase
Results
$1,620,000.00 paid in total after 360 payments
No ownership
Mortgage
Assumptions
30 Years
20% down payment ($200,000)
5.1% interest rate
Paying for taxes
Monthly payment ($4,627)
Ownership gain is variable per month based on mortgage amortization rates\
5% increase a year due to home appriciation
Results
$72,000 in Taxes Paid
$763,695 in interest paid
$30,000 in home insurance
$1,665,695 paid in total after 360 payments
Results
Total Payments
Year
Gypsy
Renting
Mortgage (Excluding Downpayment)
5
$310,500
$270,000
$264,959
10
$621,000
$540,000
$525,575
15
$931,500
$810,000
$786,191
20
$1,242,000
$1,080,000
$1,046,807
25
$1,552,500
$1,350,000
$1,307,423
30
$1,863,000
$1,620,000
$1,563,695
Total Ownership
Year
Gypsy
Renting
Mortgage (Excluding Downpayment)
5
$69,125
$0
$94,712
10
$174,345
$0
$243,707
15
$347,463
$0
$470,317
20
$632,295
$0
$806,793
25
$1,100,932
$0
$1,297,493
30
$1,871,985
$0
$2,003,183
Total difference from rent paid to ownership gained
Red = in a loss
Green = in a profit
Year
Gypsy
Renting
Mortgage (Excluding Downpayment)
5
$241,375
$270,000
$170,247
10
$446,655
$540,000
$281,868
15
$584,037
$810,000
$315,874
20
$609,705
$1,080,000
$240,014
25
$451,568
$1,350,000
$9,930
30
$8,985
$1,620,000
$439,488
Conclusion
While Gypsy is not as profitable as a traditional mortgage, it is leaps ahead of traditional renting.
