Arrived Launches Trading Platform for Rental Home Shares
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Arrived Homes: The Rise of Fractional Real Estate Investment
What is Arrived Homes?
Arrived Homes is a platform that allows investors to buy and sell shares of single-family rental properties for as little as $100. Launched in 2021, Arrived aims to democratize real estate investment by offering access to a market traditionally reserved for larger investors. Instead of investing in a Real Estate Investment Trust (REIT) as a whole, investors can curate their own portfolio of properties, managed by Arrived, and benefit from both rental income and potential property gratitude.
How Does Fractional Ownership Work with Arrived?
arrived operates under a unique regulatory framework developed in collaboration with the Securities and Exchange Commission (SEC). Each property is registered as a Recurring Offering, qualifying it as a REIT, which allows both accredited and non-accredited investors to participate. This structure allows for hundreds of investors to own shares in a single property,effectively “unbundling” the customary REIT model.
Here’s a breakdown of the process:
- Property Selection: Arrived identifies and acquires rental properties.
- SEC Registration: Each property is registered with the SEC as a REIT.
- Offering: Shares of the property are offered to investors for as little as $100.
- Management: arrived handles property management, including tenant screening, rent collection, and maintenance.
- Income Distribution: Rental income, after expenses, is distributed to shareholders proportionally to their ownership.
Growth and Investment
Arrived has experienced significant growth since its inception, doubling its property count each year. As of late 2023, the platform boasts approximately 500 properties across 65 cities. This rapid expansion is fueled by substantial investment, including funding from prominent investors. The company’s success demonstrates a growing demand for accessible and diversified real estate investment options.
| Year | Approximate Property Count |
|---|---|
| 2021 | ~250 |
| 2022 | ~500 |
| 2023 (Late) | ~500+ (Continuing to grow) |
Comparison to Traditional REITs and Roofstock
While REITs offer exposure to the real estate market, Arrived provides a more granular level of control. Investors can choose specific properties based on their investment criteria, rather than investing in a diversified portfolio managed by a REIT. Unlike Roofstock, which primarily facilitates the sale of entire investment properties, Arrived focuses on fractional ownership, making it accessible to a wider range of investors.
Risks and Considerations
Like any investment, fractional real estate ownership carries risks. Property values can fluctuate, and rental income is not guaranteed. Liquidity can also be a concern, as selling