The Millennial Dilemma – Can Partial Homeownership Bridge The Gap To Full Homeownership?

Fractional ownership is a unique investment model that allows people to access high-value assets like luxury yachts, private jets or exclusive vacation homes without the hefty price tag of sole ownership.

There also are opportunities to invest in rental properties, which can unlock value through rental income and appreciation.

This collaborative approach involves a group of investors pooling resources to purchase and maintain the asset. Each investor receives a designated share of ownership.

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The Jeff Bezos-backed Arrived platform allows retail investors to buy into single-family rentals for as little as $100.

Investing on the Arrived platform offers investors the potential for returns through two primary channels:

• Dividends: regular income generated from rental income, property appreciation and other sources
• Appreciation: growth in the value of the underlying real estate assets over time.

Arrived reports that its returns on single-family residential investments have historically been 6% to 10%, with a minimum hold of five to seven years. For vacation rentals, the historical return is 4.5% to 12%, with a minimum hold of five to fifteen years.

See Also: Arrived Home's Private Credit Fund’s has historically paid an annualized dividend yield of 8.1%*, which provides access to a pool of short-term loans backed by residential real estate with just a $100 minimum. 

Overall, Arrived has paid 711,000 investors $10 million in dividends and interest on a total investment of $219 million.

While historical ranges provide guidance, individual property performance can vary. Diversifying your portfolio allows you to capitalize on opportunities across different properties and potentially achieve better overall returns.

Investing in multiple properties offers several key benefits, including reduced risk due to minimized exposure, enhanced income stability and improved market exposure.

Many people of the millennial generation are turning to fractional investment as the dream of homeownership becomes increasingly elusive.

Trending: This Jeff Bezos-backed startup will allow you to become a landlord in just 10 minutes, with minimum investments as low as $100 for properties like the Byer House from Stranger Things.

Soaring home prices, limited inventory and rising interest rates create a formidable barrier to entry for millennials, which is holding the generation back from homeownership, according to the Trust & Will 2024 estate planning study "The Millennial Approach to Estate Planning."

The stress manifests in several ways. For instance, the survey revealed that millennials believe they would need a $525,000 annual income to achieve happiness – nearly double the national average. This highlights the immense financial pressure they feel.

Fifty-five percent of millennials surveyed for the report cited the housing crisis and interest rates as two reasons preventing them from buying property – more than any other age group – and 58% say their place in the "sandwich generation," simultaneously caring for their aging parents and their children, will affect their ability to pass on wealth.

Arrived Achieved A Total Return of 34.7% On Their Biggest Sale Yet — Diversify Your Monthly Income Stream With Fractional Real Estate

Arrived allows individuals to invest in shares of rental properties for as little as $100, providing the potential for monthly rental income and long-term appreciation without the hassles of being a landlord. With over $1 million in dividends paid out last quarter and a growing selection of properties across various markets, Arrived offers an attractive alternative for investors seeking to build a diversified real estate portfolio. 

In October 2024, Arrived sold The Centennial, achieving a total return of 34.7% (11.2% average annual returns) for investors. Arrived aims to continue delivering similar value across our portfolio through careful market selection, attentive property management, and thoughtful timing in sales.

Looking for fractional real estate investment opportunities? The Benzinga Real Estate Screener features the latest offerings.