Arrived Homes has three primary revenue streams – Agent Commissions, Acquisition Charges, and Management Fees.
When Arrived Homes purchases a property, they serve as their own purchasing agent. As a result, they obtain Agent Commissions from the initial property seller during the purchase. This commission isn’t explicitly listed for investors on their Property pages.
However, investors can clearly see the Acquisition Charge. This fee is displayed with other expenses and typically hovers around 5% of the property’s final purchase price. To illustrate, on a property worth $685,000, the charge for investors by Arrived Homes is close to $35,000.
Then there’s the Management Fee by Arrived Homes. Once all shares of a new property are sold, they begin levying a continuous fee, roughly 0.5% of the property’s yearly value. Over a usual holding duration of 5-7 years, this implies that investors pay an extra 2.5% to 3.5% from the property’s value appreciation. Taking into account these charges, Arrived Homes gains an added $17k to $25k for each property they offload, excluding any appreciation value.
These charges come in addition to other potential incomes like the difference between actual cash inflow from the “Rental Dividend Yield” and actual property value growth from the “Property Equity Returns.”
Also, for their third-party property management services, Arrived Homes deducts 8% from the rental earnings.