Is Arrived a Good Investment? 

Arrived (formerly Arrived Homes) is a fractional real estate investment platform that allows individuals to invest in rental properties with a low minimum investment. By purchasing shares of single-family homes, investors can earn passive income from rental payments and benefit from potential property appreciation.

While Arrived offers an accessible way to invest in real estate without the hassles of property management, factors such as fees, liquidity, and market conditions should be considered before investing. Understanding the risks and potential returns can help determine if Arrived aligns with your investment goals.

What is Arrived?

The mission of Arrived is simple: make real estate investing easier and more accessible. It aims to achieve this with a user-friendly platform and low minimum investment costs. Real estate investing is often a great way to grow wealth, but it’s not feasible for many investors because of the time required and high investment costs.

Arrived brings real estate investing to everyone by identifying properties already in hot markets and listing them on the platform for investors to purchase shares in.

How Does Arrived Real Estate Investing Work?

Investing through Arrived is relatively easy. First, investors need to make an account. They’ll need to provide personal information as well as answer a few questions about their financial situation and investing expertise. Then they’ll need to link their bank account. Once a bank account is linked and verified, investors will be able to fund their accounts and browse investments.

Arrived has a minimum investment of $100, which will get investors one share of a property. If they have more funds to invest, they can buy multiple shares of one property or diversify across properties. Investors can own up to 10% of shares per property. Each property has been vetted and identified as a good investment by the Arrived team so investors can feel confident in their decision.

Once you purchase shares of one or more properties, investors will start to earn regular passive income in the form of rent from the property. If the property increases in value, investors will also receive their share of that rise in value.

Because of their accessibility and relatively low investment fees, Arrived is designed for investors of varying expertise and net worth. It allows investors who can’t afford to purchase an entire investment property to include real estate in their portfolios. It’s also a good opportunity for an investor who doesn’t want to deal with the headache of property ownership and management.

Is Arrived Worth the Hype?

The mission statement sounds good, but is Arrived a good investment? According to historical ROI data, it appears to provide solid returns, although past performance is not a guarantee of future success. Arrived breaks its returns data down into a few categories: single-family homes and vacation rentals.

Single-family homes:

• Without leverage: 6-10%
• With leverage: 7-12%

Vacation rentals:

• Without leverage: 5.5-12%
• With leverage: 6-15%

It’s important to note that this data is collected from diversified portfolios, meaning investors who have holdings in more than one property. Investors can also view returns data on specific properties before selecting an investment.

Arrived does appear to have strong historical returns. Considering the S&P 500 typically generates about 10% in returns, Arrived may offer similar or potentially higher returns, but your investment is not without risk and returns are not guaranteed.

Pros of Investing with Arrived

Arrived offers a variety of benefits to investors.

• Low Minimum Investment: It allows investors to own shares of a property with minimum investment of as low as $100.
• Easy-to-use Platform: Its platform is easy to use and can help diversify an overall investment portfolio. Since the real estate market operates independently of traditional stock markets, it can help mitigate risk and improve success in your investment strategy.
• Regular Passive Income: Plus, investors could earn passive income by investing through Arrived. Properties will generate rental income, which will be paid out to investors on a regular basis. This income can be used to pay expenses or to continue growing your portfolio.
• Low Fees: Arrived also has very low fees. It charges a 1% annual fee, allowing investors to optimize their investments. However, each individual investment may charge property management and sourcing fees.

Cons of Investing with Arrived

No investment or platform is perfect, and the risks associated with Arrived are important to note.

• Limited Liquidity: Investors cannot easily sell their shares, and there is no active secondary market for quick exits. Investors must wait for Arrived to sell the property, which could take several years.
• Management & Platform Fees: Arrived charges property management and platform fees, which can reduce overall returns.
• Limited Control & Decision-Making: Investors own shares, not the actual property, which means they have no say in rent pricing, maintenance, or selling decisions.
• Long Investment Horizon: Properties are typically held for 5-7 years, so investors should be comfortable with a long-term commitment. Additionally, early withdrawal options are limited or non-existent.

Real Estate Market Analysis

According to the National Housing Market Summary and Data, mortgage rates have increased over the last year and home sale prices have fallen. Rentals are also harder to afford than they were a year ago, likely from the rise in interest rates enacted by the Fed over the past year to combat inflation.

Arrived does have a very strict selection process for properties. It selects properties in markets that prove to be growing, so investors can feel more confident in their decisions. However, investors should be aware of the overall real estate market trends so they can adjust their investing strategy accordingly.

Due Diligence and Risk Mitigation

Arrived makes the investing process very easy, but that doesn’t mean investors shouldn’t conduct their own research and due diligence. Investors should stay up to date on current real estate market trends to inform their investing decisions. Additionally, they should research the market and area that their potential investment is in.

Diversifying a portfolio is also the best way to mitigate risk. Instead of investing in just one or two properties, investors should expand their holdings across properties in multiple markets. Additionally, investors should have holdings in other markets, such as stocks, bonds, and funds. This process will help balance their entire portfolio so that potential losses in one market may be balanced out by another.

Begin Real Estate Investing Today

If you believe Arrived matches your investment goals and strategy, then you can start your journey into real estate investing today. Browse properties on the user-friendly platform, conduct your own research, and become a property owner with the click of a button. If you have questions about how Arrived fits into your overall portfolio, ask your financial adviser.

Frequently Asked Questions