Arrived Homes Review: Pros, Cons, And Alternatives

The idea of investing in real estate is enticing for many. Owning a rental property both diversifies your portfolio and provides steady, passive cash.

But the thought of having to become a landlord is a deal-breaker for many of us. Finding the time to manage tenants and maintain a property can seem impossible when you already have a day job consuming 40+ hours of your week.

But what if you could have the best of both worlds? With Arrived Homes, you can enjoy the benefits of real estate investments without having to actually manage any rental properties. Intrigued? Let’s dive in for a closer look at how Arrive Homes works.

What Is Arrived Homes?

Arrived Homes is a start-up that wants to create an opportunity for everyday investors to get into real estate investing. Earlier this year, the company raised $37 million in seed funding. One of their primary investors is Jeff Bezos.

Ryan Fraizer, the CEO and co-founder, says, “Our goal is to make the wealth-building potential of owning rental homes more accessible. We believe we can do that by simplifying the process and lowering the cost to get started.”

Essentially, you can start your real estate investment journey with just $100 through Arrived Homes. As an investor, you'll collect dividends from the properties and your share of the appreciation without handling the details like finding tenants or handling maintenance requests. 

What Does It Offer?

So, what can Arrived Homes offer you? Here are the features that stand out. 

Consistent Passive Income Without The Hassle

A major draw of investing in real estate is the potential to rent out a property for consistent passive income. But being a landlord can be a drain on your time, energy, and resources.

Through Arrived Homes, you won’t have to deal with tenants or property maintenance to enjoy the income stream. Instead, you can let Arrived Homes take care of the details. But you'll still be able to enjoy the rental income through regularly quarterly deposits.

Benefit From Property Appreciation

Since you'll be a part-owner of an actual property, you'll also take part in any returns due to property appreciation. You'll get to watch the property value grow over time. And once the property is sold, you'll receive a percentage of the profits based on your ownership shares.

Low Investment Minimum

You can start investing with Arrived Homes with just $100. But you'll be able to invest up to $20,000 per house. As you continue to work with Arrived Homes, you can build a property portfolio that reflects your goals. 

Rigorous Property Requirements

Vetting a property for purchase is something that Arrived Homes takes very seriously. The company uses extensive data science to ensure they are acquiring homes at the right price.

Arrived Homes will take care of the paperwork from research to acquisition. With that, you won’t have to spend time hunting around for the perfect property. 

No Personal Liability

As they build their real estate assets, some investors begin to worry about the personal liability associated with managing rentals. But this isn't something that you'll need to worry about when you invest through Arrived Homes.

The company will place all new properties into an LLC. That means there is no personal liability involved in your investment. 

Related: How To Set Up An LLC For Investing

Arrived Single Family Residential Fund

In December 2023, Arrived announced the launch of a new investment offering - the Arrived Single Family Investment Fund. According to Arrived, the fund was based on feedback from its community of investors, who were looking for improved liquidity and diversification. 

Arrived's existing investment products allow you to invest in select individual properties. With its new fund, you can invest in several properties across multiple real estate markets, to achieve instant diversification. You also benefit from improved liquidity, with options available in as little as six months after making your initial investment (certain approvals must be met.) 

In addition to improved diversification and liquidity options, the new fund is always available for new investment, with higher maximum investment thresholds. 

Arrived Homes Historical Performance

We love the fact that Arrived shares the performance data on it's investments very transparently. The have over 352 properties funded so far, and you can see the entire list of performance for each property here. 

What we appreciate is that you can see the full range - including properties that have a negative return. They're not trying to sugar coat the risk in investing in rental real estate.

Are There Any Fees?

Arrived Homes does come with a few fees that you should be aware of. First, the company charges an annual management fee. We couldn't find a specific percentage listed anywhere on Arrived Homes' site. But several third-party source have reported that the AUM fee is 1%.

Second, Arrived Homes will charge 8% of the rent for property management at each home. The property management expenses are used to pay their third-party property managers. They don’t collect any income from the property management itself.

Third, you'll pay a one-time sourcing fee. This fee will vary by property and will be already included in the share price listed. You can find the sourcing fee for a property inside the Offering Details section of its investment page.

How Does Arrived Homes Compare?

Arrived Homes offers investors the chance to dive into real estate investing with minimal capital. However, the company isn't the only one to provide this option to budding real estate investors.

Roofstock offers investors a similar style of investment through Roofstock One. Roofstock One is currently closed to new investors. But when it relaunches, accredited investors will be able to buy whole or fractional shares of a managed investment property.

Fundrise doesn't allow investors to pick and choose individual properties. But, through its eREITs. it does make it easy to invest in many cash-flowing properties (residential and commercial) starting with as little as $10. Here's a closer look at how Arrived Homes compares:

How Do I Open An Account?

Ready to dive in with Arrived Homes? You'll need to start by creating an account with your email and a password. Next, you’ll have to provide your legal name and agree to Arrived Homes’ terms of service.

At that point, you can explore the potential properties in greater detail and link your bank account when you're ready to invest in an offering. When I explored the platform, none of the properties were ready for investment. Instead, I had the option to reserve shares and be notified when I would need to put up my investment.

Is It Safe And Secure?

Arrived Homes offers an opportunity to invest in real estate, which comes with inherent risks. It's possible that you could lose money on a deal. But so far, that hasn’t been the case.

In terms of liability protection, Arrived Homes keeps you safe from any personal liability. Each property is placed in an LLC. As an investor in any home, you will invest in the LLC. With that, you won’t be personally on the hook if any lawsuits come about in regard to a particular property.

With any real estate investing site, it's important to discuss liquidity. The anticipated holding period for the investments listed on its site is 5-7 years. That's a long time to have your money tied up, especially compared to stocks and ETFs which can be sold at any time.

Arrived Homes says that investors will be able to request early redemption of their shares after 6 months. But it also says that there's no guarantee that a secondary market will develop. In other words, you may have a difficult time finding a future buyer who will want to purchase your shares.

How Do I Contact Arrived Homes?

Want to reach out to Arrived Homes? You can get in contact through the Live Chat feature on their site, call 1-814-277-4883, or email their customer support team at support@arrivedhomes.com.

Additionally, you can connect via Facebook, Twitter, Instagram, and LinkedIn @ArrivedHomes.

Why Should You Trust Us?

I have been writing about and reviewing investment firms and covering real estate investments for 10 years. I have personally owned single family, multi-family, real estate syndications, private partnerships, and more. I'm well versed in both the investment aspect and tax aspect of these products and services.

Furthermore, we have our compliance team that regularly checks and updates the facts on our reviews.

Who Is This For And Is It Worth It?

We love the concept behind Arrived Homes for those who want to invest in real estate without taking on the responsibility of being a landlord. But with few to no properties actually ready for investment right now, the platform seems like it's still a work in progress.

Over time, Arrived Homes could develop into a serious contender in the real estate investing world. They've consistently been increasing their inventory on the platform, and new users will usually find anywhere from 4 to 10 different investment options available.

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Arrived Homes Features