In the dynamic real estate landscape, a Jeff Bezos-backed startup known as Arrived is making waves by democratizing investment in rental properties. The company, which initially allowed individuals to invest in single-family homes, is now launching a groundbreaking “Single Family Residential Fund,” according to a report from Vice. The move enables investors to diversify their portfolios by putting their money into a fund that spans the startup’s holdings. As the company capitalizes on the growing demand for rental homes, questions about the impact on housing availability and the broader real estate market come to the forefront.
Arrived, established in 2021, seized attention by transforming single-family homes into rental properties accessible to investors for as little as $100, according to the report. The model allowed individuals to buy shares of specific homes, earning dividends from the collective rental profits, and the recent introduction of the “Single Family Residential Fund” takes this concept further in providing investors with an opportunity to invest in a diverse range of homes across Arrived’s network.
With more than 300 homes available for investment across the country, including in states like Arkansas, Tennessee and Virginia, Arrived has attracted approximately half a million investors, according to the report.
The firm’s move into single-family home rentals aligns with the shifting dynamics of the real estate market. In the report, the company acknowledged the rising challenge of homeownership affordability, pushing more people towards renting. Additionally, the nationwide housing shortage provides a backdrop for Arrived’s expansion, as the demand for rental properties continues to outstrip supply.
Arrived has attracted investments from influential figures in the tech industry, including Jeff Bezos, Mark Benioff, Spencer Rascoff and Dara Khosrowshahi, according to the report. The support from such high-profile individuals underscores the potential transformative impact Arrived could have on the real estate investment landscape. However, Arrived has also drawn criticism for reducing the supply of single-family homes available for traditional purchase.
According to data detailed in the report, investors comprised 25 percent of all homes sold in 2021, and this figure rose to 28 percent in 2022. While investor-owned single-family homes currently make up around 5 percent of the market, projections suggest that investors could constitute 40 percent of the single-family home market by 2030.
