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Real estate is one of the oldest and most popular investments available. Rising inflation and uncertainty in the stock market have more investors looking for simple ways to add real estate to their portfolios while avoiding the headaches that go along with being a landlord.
Real estate crowdfunding is proving to be the answer for more retail investors looking for passive investments that provide consistent cash flow, appreciation and a hedge against inflation.
One of the fastest-growing real estate crowdfunding platforms is Arrived Homes, which allows non-accredited investors to purchase shares of individual rental properties in some of the highest growth rental markets throughout the U.S.
This real estate investing company finds and acquires residential rental properties, then offers shares of these properties to investors through its online platform. The company handles the management of the properties while investors collect their share of the rental income and wait for the property to appreciate in value over time.
After the target hold period, Arrived Homes sells the property and distributes the equity to each investor according to the number of shares they own. Assuming the property increases in value, the investors share in the profits from the sale.
Unlike a residential REIT, like Invitation Homes Inc INVH that owns and operates a portfolio of rental properties, shares of properties purchased through Arrived Homes aren’t affected by fluctuations in the stock market. Instead, the value of the shares is directly tied to the value of the property. This makes it an ideal asset class for investors looking for a hedge against stock market volatility.
Current Offerings on Arrived Homes: The company typically launches new offerings in batches every few weeks as they become qualified by the Securities and Exchange Commission (SEC). The most recent batch is almost sold out, with shares remaining in only four properties. These properties are located in Georgia and Alabama.
How to Invest in Shares of Rental Properties: Investors can access the properties currently available on the Arrived Homes platform by creating a free account on the company’s website. Once an account is created, investors can browse the current offerings, view details on each property and make investments in whichever offerings they choose.
It’s important to note, however, that real estate is a long-term investment with holding periods averaging five to seven years. Arrived Homes also hasn’t announced any plans to launch a secondary market, so investors should anticipate having to hold their shares for the full term.
Photo: Courtesy of Arrived Homes
This article was originally published on Jan. 25, 2022. It has been updated with current information on available offerings through Arrived Homes.
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