A New REIT Is Taking On The Housing Affordability Crisis, And Its Plan Looks Promising

In response to the country’s escalating housing affordability issue, Elevate Money's new real estate investment trust (REIT), the Future Of Housing Fund (FOHF), is proposing a solution. Partnering with modular home manufacturer Boxabl, the fund aims to channel investment capital and innovation into the affordable housing sector.

Boxabl's Innovative Home Construction Method

Boxabl is making waves for its novel approach to home construction. Its modular units, which can be efficiently folded and shipped on standard truck trailers, place the company at the forefront of potential change in traditional housing construction. Harold Hofer, CEO of Elevate Money, commented on the alliance, highlighting the goal of creating communities that are both affordable and aesthetically pleasing.

The National Association of Realtors has flagged a substantial housing shortfall in the U.S., totaling 5.5 million units. This gap, paired with the prevailing view that housing costs shouldn’t surpass 30% of a household’s income, underscores the depth of the housing crisis.

Boxabl aims to directly address this shortage. Traditional single-family homes typically take about seven months to build, whereas a Boxabl Casita can be constructed in just four hours.

Factory-produced housing isn’t a new idea, but Boxabl’s patented production technique, allowing for efficient shipping, gives it a distinct edge. The ability to easily and affordably transport homes could translate into a truly affordable housing option.

Boxabl's reputation is gaining traction. Elon Musk even purchased one of the first Boxabl Casitas to use as a guest house. Additionally, hefty investments from firms like DR Horton Inc. DHI and a $9.2 million U.S. Government contract bolster its industry standing.

Elevate Money’s Role in The Future of Housing

While Boxabl brings housing innovation, Elevate Money furnishes the necessary financial infrastructure. The company's Future of Housing Fund has secured rights to buy a minimum of 10% of Boxabl’s monthly Casita production, positioning it favorably given Boxabl's 170,000-home waitlist.

Having made its debut in 2021, Elevate Money has already impressed its investors with 18 consecutive monthly dividend payouts and an annual yield of 6.5%. Its alliance with Boxabl marks a pivot to the affordable housing realm, shifting from its earlier concentration on single-tenant net leased commercial properties.

Established players like Invitation Homes Inc. INVH and American Homes 4 Rent AMH have seen recent market challenges, with decreases of 14% and 7.8% over the previous year, respectively. Against this backdrop, FOHF presents as a potential alternative.

Distinct from traded REITs, nontraded REITs like FOHF aren’t directly influenced by daily stock market swings, potentially offering more stable pricing. This could appeal to investors seeking less volatility.

While many residential REITs operate in conventional residential rental sectors, FOHF directly confronts the housing crisis. Its mission could resonate with investors looking to achieve both financial returns and societal impact.

The collaboration between Boxabl and Elevate Money signals a contemporary solution to a persistent problem. Time will determine the partnership’s impact on the housing dilemma, but with advanced technology and a progressive investment approach, it shows promise. The market awaits to see how this REIT fares in addressing a significant U.S. challenge.

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