Investing in real estate used to be complicated.
Arrived is designed to make it more accessible. You can invest in equity by buying shares in individual rental homes, investing in curated funds that hold portfolios of homes, or investing in real estate-backed credit through a fund that provides short-term financing for professional real estate projects.
Different Arrived products are designed for different investor needs and portfolio roles. This article explains how they differ. It is educational and is not a recommendation. Consider your own goals and consult a financial professional before investing.
Key differences between Arrived products
Understanding the differences between Arrived’s investment options can help you decide which strategy fits your goals:
- Return type: Investments may generate returns through rental income, potential appreciation, or both, depending on the offering.
- Income potential: Properties in established rental markets may provide rental income, while properties in emerging markets may have more potential for appreciation.
- Minimum hold periods: The minimum hold period varies across Arrived products. Arrived investments should generally be viewed as longer-term investments.
- Diversification: Arrived offers investments across property types and locations. Diversification can help spread exposure, but it does not eliminate risk.
How Arrived’s products work together
With Arrived, you can combine different investment types in one portfolio. Each product is designed to play a different role.
Individual property offerings
Individual property offerings give investors targeted exposure to a specific property. Each property is reviewed by Arrived’s investment team before it is offered. Investors choose how much to invest in each property and can build a portfolio one property at a time.
Single-family residential properties
Arrived focuses on buying single-family homes and renting them to long-term tenants, typically on one- to two-year leases. The strategy aims to generate rental income during the hold period and to sell the property later, with the potential to benefit from any appreciation.
- Return type: Rental income and potential appreciation. Appreciation is not guaranteed, and property values can fall.
- Performance: Historical performance varies by property. See each property's Investment Details Page for its dividend history and current valuation.
- Liquidity: After a six-month minimum hold, investors may list shares on the Arrived secondary market. The secondary market can provide a path to liquidity, but it does not guarantee a sale or a specific price.
- Diversification: Spreading an investment across multiple properties can reduce exposure to any single home. Diversification does not ensure a profit or protect against loss.
Funds
Arrived's funds provide broader exposure across multiple assets in a single investment. The Single Family Residential Fund and the Seattle City Fund hold single-family rental homes, and the Real Estate Income Fund holds short-term loans backed by residential real estate.
Single Family Residential Fund
The Single Family Residential Fund pools investor capital into a portfolio of single-family rental homes across multiple U.S. markets.
- Return type: Rental income and potential appreciation. Appreciation is not guaranteed, and property values can fall.
- Performance: See current historical performance on the Single Family Residential Fund offering page.
- Redemptions: Investors may request a redemption after holding shares for six months. Requests are processed quarterly, are subject to limits and fees, and may be limited or suspended. Redemption is not guaranteed.
- Diversification: The Fund holds homes across multiple markets, which spreads exposure beyond any single property or city. Diversification does not ensure a profit or protect against loss.
Seattle City Fund
Arrived City Funds focus on investments in a single metropolitan area, offering targeted market exposure while maintaining diversified pooled assets. Unlike the Single Family Residential Fund, which spans multiple markets nationwide, a City Fund lets investors focus on a specific market.
- Return type: Rental income and potential appreciation. Appreciation is not guaranteed, and property values can fall.
- Performance: See current historical performance on the Seattle City Fund offering page.
- Redemptions: Investors may request a redemption after holding shares for six months. Requests are processed quarterly, are subject to limits and fees, and may be limited or suspended. Redemption is not guaranteed.
- Diversification: The Seattle City Fund offers diversification across various properties in a single market, which can help balance exposure to any one home. It does not diversify across markets, so results depend on the Seattle housing market, and diversification does not ensure a profit or protect against loss.
The Real Estate Income Fund is built for income-focused investors. The Fund makes short-term loans to real estate investors and builders for renovations, rehabs, and new construction nationwide, and pays investors the interest it earns as monthly dividends. Dividends are not guaranteed.
- Return type: Income from loan interest. The Fund does not include property appreciation.
- Performance: See the current historical annualized dividend yield on the Real Estate Income Fund page.
- Redemptions: Investors may request a redemption after holding shares for six months. Requests are processed quarterly, are subject to limits and fees, and may be limited or suspended. Redemption is not guaranteed.
- Diversification: The Fund holds a portfolio of real estate-backed loans across borrowers and markets. Loans can default, and collateral may not cover the full loan amount.
Investing in equity vs. Real estate-backed credit
Investing in real estate on Arrived can take two forms: equity or credit.
Equity and credit investments can play different roles in a portfolio. Equity offers exposure to rental income and potential appreciation, while credit focuses on income from interest payments. Because they earn returns differently and respond differently to market conditions, some investors hold both. How you balance them depends on your own goals and circumstances.
With Arrived, equity investments include individual property offerings, the Single Family Residential Fund, Arrived City Funds, and credit investments include the Arrived Real Estate Income Fund.
Equity investments
When you invest in equity on Arrived, you buy shares of a Series LLC or fund that owns property. Returns can come from rental income and any appreciation if home values rise.
This can offer higher returns, especially if the property appreciates or generates significant rental income. However, these higher returns come with greater risk, as market fluctuations can affect property values and rental income, including potential capital loss.
Credit investments
Credit investments focus on income. Investors lend money for real estate projects and earn returns mainly through interest, rather than from rental income and appreciation. Loans are secured by residential real estate, and a portfolio of many loans spreads exposure across borrowers and properties. These features are designed to help manage risk, but they don’t eliminate it. Interest and principal are not guaranteed, and recovery in a default may be less than the full loan amount.
The importance of diversification in real estate investment portfolios
Diversification means spreading investments across different properties, locations, and investment types. Arrived makes that easier to do on a single platform. You can invest in individual rental homes, a curated portfolio of homes, and real estate-backed loans, then track them together in one account. That lets you combine sources of return, such as rental income, potential appreciation, and interest, across multiple markets. Diversification can reduce your exposure to any single investment, but it does not eliminate risk or guarantee returns.
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Disclosure
The opinions expressed in this article are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product. The views reflected in the commentary are subject to change at any time without notice.
*Past performance does not guarantee future results and there is no guarantee this trend will continue. Note: The above scenarios are for illustrative purposes only and are not intended to be used to estimate the returns of an individual property.
The table is estimated by combining the 20-year historical home price appreciation from the Zillow Home Value Index (ending Q1 2023) and average historical dividend yields from the Arrived portfolio (ending Q1 2023). These data sources were combined to estimate a hypothetical IRR for each asset type and leverage classification and then rounded to whole numbers. The single family residential and vacation rental calculations also assume an average hold period of 7 years, 6% property disposition costs, and an average annual net operating income increase of 3%. The leverage classification estimates an average of 63% financing and a 4.75% interest rate, which was selected based on existing properties with leverage at the time of calculation. The Private Credit Fund return is based on annualized dividends paid from August 2024 to April 2025.
The income return range is for new properties and does not include properties that do not receive a monthly dividend due to specific circumstances, such as vacancies, eviction proceedings, significant maintenance issues impacting the property’s cash flow, or not yet booking-ready. Any operating income for these properties will be added to the property’s cash reserves and distributed at a later dividend date.
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