Arrived Homes is a new company that allows its clients to earn dividends as shareholders of residential real estate properties. Fortunly’s Arrived Homes reviews of various aspects of this business found that investors are protected from personal liability and that the low minimum investment amount makes it possible for anyone to start earning from rental income.
However, property management through Arrived Homes has its drawbacks, too, so read on to learn whether you should invest through this company.
Shareholders don’t bear any liability risk
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
- Low minimum investment
- Available to non-accredited investors
- Shareholders don’t bear any liability risk
- Available to everyone over the age of 18
- Arrived Home’s staff handles all related operations
- Long hold periods for short-term investments
- Lower wealth accumulation from main competitors
What Is Arrived Homes?
Arrived Homes is a crowdfunding real estate company that provides a way for investors to purchase fractional shares of rental homes. This investment opportunity is available to both accredited and nonaccredited investors, regardless of net worth or income.
Now, let's get to the specifics.
How Does Arrived Homes Work?
Investments in rental properties can be a complex and time-consuming process. Yet, Arrived Homes has created a platform allowing everyone to buy shares and earn passive income with minimal hassle. The process can be summarized in four steps:
- Home browsing - Prospective investors look through the list of Arrived Homes properties that are open to new investors and have been prevetted for their income potential.
- Selecting shares - Investors decide how much they wish to invest and choose shares.
- Signing and investing - Upon reviewing the terms and conditions and signing an online contract, investors become shareholders by linking their bank accounts.
- Earning - Besides earning passive income, shareholders take part in property value appreciation.
Does Earning This Way Involve Any Liability?
Now that you know how to invest in Arrived Homes rental properties, you’re probably wondering if it is safe and whether any personal liability is involved.
Arrived Homes places all newly acquired properties in an LLC, which means that investors are not personally liable for any lawsuits or debts related to the business.
What Is the Minimum Investment Amount?
One of the most significant benefits of Arrived Homes is the low amount you need to invest to become a shareholder.
To enter the real-estate rental market via Arrived Homes, the minimum investment you must make is $100. So, if you’ve ever wondered how to start investing with little money, this company may be an excellent place to start.
Who Can Invest in Arrived Homes Properties?
Arrived Homes is open to any US citizen or resident who is at least 18 years old, and individuals don’t need to be accredited investors to be eligible.
What Is the Ownership Policy?
When you invest in an Arrived Homes property, you buy a share of the LLC that owns that particular property. Your share entitles you to a percentage of the property’s rental income and value appreciation. So, if you own 5% of the shares, you generate 5% of the asset’s economic interest over time.
Does Arrived Homes Charge Any Fees?
When investing through this crowdfunding company, you are subject to two types of Arrived Homes fees.
Arrived charges a one-time sourcing fee for finding and preparing a property for investment. It includes any costs associated with financing or holding the property during the process, and the fee varies by property.
Asset Management Fee
The asset management fee is a quarterly expense that helps cover the cost of managing ongoing property administration. Arrived Homes reviews the investors’ capital contributions and deducts the fee based on said contributions from the quarterly property income. You can refer to the AUM fee for each property in the Offering Details section of the property page.
Additional Sources of Revenue
On top of the above, Arrived Homes collects real estate agent rebates paid by the property’s previous owner. While Arrived’s funding sources might not seem like much at first glance, homes in the US are being sold at the fastest rate since 1990, promising high earnings for investors.
Arrived Homes Contact Details
If you have any questions or concerns, you can get in touch with the company's team members in two ways. The first option is their email ([email protected]). If you prefer to talk to them directly, you can make a phone call through the client support line at +1 (814) 277 4833.
Is Arrived Homes a Good Investment Option?
In the past, Arrived Home paid out annual cash dividends ranging from 3.2% to 7.2%. Furthermore, home appreciation averaged 3.9% in the past two decades, but keep in mind that future trends are unpredictable.
While you bear no liability risks and can start accumulating wealth with as little as $100, investing through this company isn’t for everyone.
Arrived Homes is an excellent option for people interested in real estate investing who don’t have much money to spend and have a limited understanding of the complexities of the real estate market.
Moreover, buying Arrived Homes shares isn’t a great idea for short-term investors because the anticipated property hold period is between five and seven years.
Who Are the Company’s Main Competitors?
Based on capital contributions
0.5% or $500
It’s also worth noting that accumulating funds through this platform may be slower than with some Arrived Homes competitors. Although the company is new in the market, the historical data of Fundrise returns fluctuated between 9% and 12% from 2014 to 2019, promising a higher income than what Arrived offers at the moment.
Arrived Homes Benefits and Downsides
Now, let’s review the main Arrived Homes pros and cons.
Some of the most appealing things about investing through Arrived Homes are:
- Investors don’t bear any liability risks for lawsuits or personal guarantees.
- You can invest in distant markets for higher returns, regardless of your location.
- It offers access to the real estate rental market to nonaccredited investors.
- Arrived’s team of professionals takes on all the operational responsibility, so you can sit back and wait for your passive income to flow.
- The $100 threshold for investing in a rental property is very accessible.
Besides attractive benefits, Arrived real estate investments come with a few potential drawbacks:
- Potentially lower earnings compared to certain competitors
- Too long property hold periods for short-term investing
- A limited selection of rental homes compared to more experienced dealers
Real Estate Terms You Should Know
While navigating the world of real estate, you will likely hear many confusing terms, and we mentioned some of them in this article. So, here are a couple of simple explanations:
- Dividend payments - A type of payment made by a company on a regular basis as a means of sharing profit with its shareholders.
- Home appreciation - The value increase of investment property over time. As the value increases, the owner can earn more through the monthly rent their tenants pay or by selling the property further down the line.
- Conveyancing - The legal process of transferring property ownership from one person or entity to another. It is typically done through a written document such as a deed, lease, contract, will, or title.
Concluding our Arrived Homes review, we found that investing through this crowdfunding company’s platform would be a good move for modest-income investors. It offers a risk-free liability policy and caters to long-term investors since their hold periods typically exceed five years.
On the downside, as a relatively new player in the rental home market, Arrived Homes owns fewer properties than its main competitors. Moreover, if you intend to focus on short-term investments, you might wish to look elsewhere for investment opportunities, such as trading stocks and cryptocurrencies.
Is Arrived Homes legit?
Arrived Homes is a legit real estate investment platform. Its terms and conditions and granted licenses are governed by the laws of the State of Washington.
How long has Arrived Homes been in business?
Arrived Homes was founded in 2020.
How does Arrived make money?
Arrived Homes reviews properties and generates income by collecting agent rebates upon buying them. It also charges sourcing and quarterly asset management fees.