Hacker News Reader

> As it stands, I would be interested since I like the idea of being able to move from any property to another property without negotiating a new lease or contract - it means I'm not locked to any particular economic region.

^ This is one aspect of housing we think is missing and that we're trying to support. More and more people are ready to build home ownership, but still want the flexibility to move homes or cities. So they get torn between renting or buying. By building the ownership position in a real estate fund, instead of a single home, that ownership position can move with you to new homes.

Re Rent: Monthly rent is set based on the value of the home a member moves into and local rental rates for the area. It should be in-line with what you'd expect to pay in rent for a similar home outside of Arrived and is transparent to members at the outset.

Re Profits: Members participate as LPs in our real estate fund and receive a percentage of rent and appreciation which adds to their investment over their lease term. We take a long-term buy and hold position in the homes so appreciation is based on re-appraisals of the homes over time to incorporate changes in value.

And thank you for the feedback on an FAQ, we're working on it!

> Further, "home equity" is a weird term in this context. Home equity is a mark of ownership and makes clear sense in the cass of a single home - 100% home equity in a single house means you get 100% of all the profits after that house is sold. The total number of "shares" for a single house is fixed and never changes, meaning home equity never dilutes. For a collection of homes in this model, it's murkier because new renters and new houses would impact the number of "shares" available.

If I understand correctly, I think they're thinking of it more like credit. When you make payments to them, you accrue "equity credit". You may exchange that equity credit for a given home, if it reaches whatever value threshold that home has. You can apply your equity credits to any home in their collection, however each home will require a different amount to purchase, and a different monthly payment to live in.

I think it's a really clever and really interesting idea, if i'm understanding it correctly.

Then I have even more questions, because in order to offset operating recurring costs for Arrived, that "equity credit" can't be a one-to-one mapping to the house's actual value - it has to offset costs for maintaining the house for you.

In other words, if you use your "equity credit" to take a house for yourself, you could end up paying more than the house is actually worth.

Of course you end up paying more than the house is worth, just as you would if you paid down a mortgage with interest.

Moreover, you'd have to pay for maintenance even if you outright owned the house.

Of course. You'll overpay, just like you would with interest from a mortgage. But you do get something in return for that overpayment. Whereas with a loan you merely get "time value" for your over-payment in the form of interest, here you are also buying the optionality of moving around. That option has value, and it's appropriate for them to charge some premium for that.

What happens to your pseudo-equity when Arrived goes bankrupt?

Arrived the company and Arrived the fund (which owns the homes) are separate entities. Arrived the company is the manager of the fund, but the fund assets are protected in it's own entity. Members of the service invest as LPs in the fund and would have the option to exchange their shares based on the income and value of the homes. If all fund LPs wanted to exchange their shares, the fund may need to sell its ownership position in the portfolio of homes and each member would receive their share accordingly.

Still doesn’t anwser the question. Seems like once you dissolve the entity the new owners could kick you out of the house