Arrived Homes is a real estate investment platform that offers a unique opportunity for individuals seeking to diversify their investment portfolios. This company utilizes the concept of co-ownership, allowing investors to purchase shares of fully managed rental properties across the United States. But the question is, "Is Arrived Homes a good investment choice for you?"
The straightforward answer is that Arrived Homes presents a compelling opportunity for investors to diversify their portfolios, generate passive income, and benefit from the long-term stability and potential growth of the real estate market.
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What is Arrived Homes?
The mission of Arrived Homes is simple: make real estate investing easier and more accessible. It aims to achieve this with a user-friendly platform and low minimum investment costs. Real estate investing is often a great way to grow wealth, but it’s not feasible for many investors because of the time required and high investment costs.
Arrived Homes brings real estate investing to everyone by identifying properties already in hot markets and listing them on the platform for investors to purchase shares in.
How Does Arrived Homes Real Estate Investing Work?
Investing through Arrived Homes is relatively easy. First, investors need to make an account. They’ll need to provide personal information as well as answer a few questions about their financial situation and investing expertise. Then they’ll need to link their bank account. Once a bank account is linked and verified, investors will be able to fund their accounts and browse investments.
Arrived Homes has a minimum investment of $100, which will get investors one share of a property. If they have more funds to invest, they can buy multiple shares of one property or diversify across properties. Investors can own up to 10% of shares per property. Each property has been vetted and identified as a good investment by the Arrived Homes team so investors can feel confident in their decision.
Once you purchase shares of one or more properties, investors will start to earn regular passive income in the form of rent from the property. If the property increases in value, investors will also receive their share of that rise in value.
Because of their accessibility and relatively low investment fees, Arrived Homes is designed for investors of varying expertise and net worth. It allows investors who can’t afford to purchase an entire investment property to include real estate in their portfolios. It’s also a good opportunity for an investor who doesn’t want to deal with the headache of property ownership and management.
Is Arrived Homes Worth the Hype?
The mission statement sounds good, but is Arrived Homes a good investment? According to historical ROI data, it appears to provide solid returns, although past performance is not a guarantee of future success. Arrived Homes breaks its returns data down into a few categories: single-family homes and vacation rentals.
Single-family homes:
- Without leverage: 6-10%
- With leverage: 7-12%
Vacation rentals:
- Without leverage: 5.5-12%
- With leverage: 6-15%
It’s important to note that this data is collected from diversified portfolios, meaning investors who have holdings in more than one property. Investors can also view returns data on specific properties before selecting an investment.
Arrived Homes does appear to have strong historical returns. Considering the S&P 500 typically generates about 10% in returns, Arrived Homes may offer similar or potentially higher returns, but your investment is not without risk and returns are not guaranteed.
Pros of Investing with Arrived Homes
Arrived Homes offers a variety of benefits to investors. It allows investors to own shares of a property with low minimum investments. Their platform is easy to use and can help diversify an overall investment portfolio. Since the real estate market operates independently of traditional stock markets, it can help mitigate risk and improve success in your investment strategy.
Plus, investors could earn passive income by investing through Arrived Homes. Properties will generate rental income, which will be paid out to investors on a regular basis. This income can be used to pay expenses or to continue growing your portfolio.
Arrived Homes also have very low fees. It charges a 1% annual fee, allowing investors to optimize their investments. However, each individual investment may charge property management fees and sourcing fees.
Cons of Investing with Arrived Homes
No investment or platform is perfect, and the risks associated with Arrived Homes are important to note. Despite the ease of use and Arrived Homes' thorough process for vetting properties, real estate investing is still risky. Property values can fluctuate quickly and the movement of the real estate market is hard to predict, especially for beginner investors.
Investors should also be wary of using Arrived Homes as their sole investing platform. It may be a good addition to a portfolio, but investors should include other types of investment vehicles in various verticals for true diversification. That way, if the real estate market dips, their losses will be mitigated by other investments.
One of Arrived Homes’ biggest benefits is allowing investors to own property without needing to manage it. However, investors also won’t get a say in how the property is managed and maintained. And if the property isn’t managed properly, it could negatively impact returns. Investors should do their research and due diligence on any investment, including through a platform like Arrived Homes.
Real Estate Market Analysis
According to the National Housing Market Summary and Data, mortgage rates have increased over the last year and home sale prices have fallen. Rentals are also harder to afford than they were a year ago, likely from the rise in interest rates enacted by the Fed over the past year to combat inflation.
Arrived Homes does have a very strict selection process for properties. It selects properties in markets that prove to be growing, so investors can feel more confident in their decisions. However, investors should be aware of the overall real estate market trends so they can adjust their investing strategy accordingly.
Due Diligence and Risk Mitigation
Arrived Homes makes the investing process very easy, but that doesn’t mean investors shouldn’t conduct their own research and due diligence. Investors should stay up to date on current real estate market trends to inform their investing decisions. Additionally, they should research the market and area that their potential investment is in.
Diversifying a portfolio is also the best way to mitigate risk. Instead of investing in just one or two properties, investors should expand their holdings across properties in multiple markets. Additionally, investors should have holdings in other markets, such as stocks, bonds and funds. This process will help balance their entire portfolio so that potential losses in one market may be balanced out by another.
Begin Real Estate Investing Today
If you believe Arrived Homes matches your investment goals and strategy, then you can start your journey into real estate investing today. Browse properties on the user-friendly platform, conduct your own research and become a property owner with the click of a button. If you have questions about how Arrived Homes fits into your overall portfolio, ask your financial adviser.
Frequently Asked Questions
How much money can I make with Arrived Homes?
Your returns from Arrived Homes will depend on the size of your portfolio and what properties you are invested in. However, you can expect an average of 6-12% in returns from a diversified portfolio.
What is the minimum investment at Arrived Homes?
Investors can get started on Arrived Homes with as little as $100.
Is Arrived Homes better than Fundrise?
Arrived Homes differs from Fundrise in its investment opportunities, so each may be better suited for different styles of investors.
About Savannah Munholland
Savannah Munholland is a dynamic author and communications professional known for her captivating storytelling and expertise in public relations. With a passion for YA fiction, Savannah explores themes of sexuality and acceptance in her writing, resonating with diverse audiences worldwide. Alongside her literary pursuits, she excels in verbal and written communications, social media management, and customer service, showcasing her multifaceted talents. As a dedicated advocate for the LGBTQ+ community, Savannah’s work reflects her commitment to promoting inclusivity and representation. Whether crafting compelling narratives or spearheading PR campaigns, Savannah’s creativity and determination leave an indelible mark on every project she undertakes.
