Have you ever wanted to start investing in single-family rentals but couldn’t secure a mortgage or scrape together enough capital to buy a property outright? Or you were apprehensive about being a landlord? Well, now, there’s a new way to invest in single-family rental: buying just a piece of the property.
Roofstock, a platform for buying and selling single-family rental homes, announced this week that it is rolling out a new program that will allow investors to buy a share in a single-family rental home and collect a return on that investment, without having to act as a landlord.
Roofstock, a HW Tech100 winner in 2018 as one of the top technology companies in the housing industry, unveiled a program that it calls “Roofstock One.”
Through the program, investors can purchase shares in fully managed rental homes and reap the benefits of property ownership while mitigating risk and eliminating the need to manage the property themselves.
Roofstock will handle the financing, insurance, leasing, property management, and asset management on the properties, while investors can buy in and acquire a share of a single-family rental property for as little as $5,000.
According to Roofstock, returns may come in the form of potential dividends, tax benefits associated with real estate ownership and price appreciation.
In this initial phase of the program, Roofstock is retaining a minimum 10% ownership interest in each fractional property for at least a year to “demonstrate investor alignment.”
Additionally, the company says that by lowering the threshold for investors to become single-family rental owners, the program allows investors to diversify their portfolio across multiple properties for less money than it would have taken to acquire a single property.
“Investor priorities may be changing, and we recognize that the old ways of doing things may no longer apply when it comes to real estate investing,” said Gary Beasley, co-founder and CEO of Roofstock. “With Roofstock One, we’re making it frictionless and seamless for investors to reap the potential benefits of real estate investing.”
According to Roofstock, the initial homes that are part of the fractional ownership program are located in the Atlanta and Indianapolis metropolitan areas.