The multiple of sale is the multiplying factor through which we come to an appraisal of a property. This number usually represents the number of months an investor will take to recover its investment while maintaining the current property metrics.
When we receive a request for valuation of a property, the Trustiu team initiates the data validation process. This process starts by first validating the seller's legitimacy before the evaluation of any data can begin.
The data we request for assessment includes visits, revenue and expenses. We analyze all the historic data available to us, but we consider the last 12 months of activity as most important and fundamental. By analyzing the performance of these 12 months we can attribute a positive or negative slope to the property. This helps to understand the current state of the project and, consequently, to discover the multiple of sale we should apply to the property.
Here is a simplified version of the formula we use to find the value of a property:
(Average monthly revenue X multiple of sale = Property value)*
One of the most important metrics for valuation is the average amount of revenue, which can be calculated using the last 3 or 12 months of activity.
ABC montlhy revenue
In this example we can see the average revenue of the last 3 months is substantially different from the average of the last 12. We can also see the revenue has increased, supposing a positive slope. The average we would apply in this circumstance is for the last 3 months.
The next metric you will see is the sales multiple, which can range from 5 to 72. This multiple represents the number of months an investor will take to recover their investment if they maintain current revenue metrics. To assign a multiple, we take into account the risks and opportunities of the investment. The better the opportunities and the lower the risk, the greater the sales multiple.
Continuing the previous example, we can assume the property is innovative, operates in a highly profitable niche and has high growth potential. Therefore, we could apply a multiple of 36. The result would be:
3116,67 x 36 = 112.200,12
This would be a hypothetical valuation of the ABC property, from $ 112,200.12.
*this formula is a simplified version. To calculate the value of the property we consider several factors and details dependent on the specificities of each property.
Some properties for sale in Trustiu are confidential in nature, something which can happen for several reasons. We do not show the identity of these properties to protect both seller and buyer. From the seller's side, we avoid being bothered by bogus buyers and non-serious interest from parties who just want to study markets. On the other hand, we also increase the difficulty of copying the business to avoid unnecessary competition for the buyer.
Yes. After making the deposit, the buyer has access to all the property's metrics. If after carrying out your analysis you decide not to proceed with the purchase, the deposit will be refunded. If you decide to buy the property the value of the deposit will be deducted from the total value of the property.
Once someone decides to buy a property for sale in Trustiu we start the process of buying and selling. This process consists of the following steps:
1. Make a payment of the total value of the property to Trustiu. (This payment can be done through various methods depending on the buyer's country).
2. As soon as Trustiu confirms the buyer's payment the property migration process begins.
3. Migration of property. This process can take from 2 days to 3 weeks depending on the complexity of the process and is advised by the Trustiu team.
4. The buyer confirms that the migration of the property has been completed successfully.
5. Trustiu makes the agreed payment to the seller.
6. As soon as the seller receives payment of the property, the process of buying and selling is complete.
Our fee is only charged when the buying and selling process is finalized. If the deal does not materialize we do not charge any fee.
These are our fees, which may change depending on the value of the property:
10% of the sale value of the property (properties up to 1 million euros)
9% of the sale value of the property (properties between 1 and 2 Million euros)
8% of the sale value of the property (properties over 2 million euros)