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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsSkyrocketing housing prices drive the world's fastest unicorn
AxiosWhy it matters: Pacaso's record-fast rise to unicorn status "the fastest-growing company of anything I've ever seen before" co-founder Spencer Rascoff tells me on the latest episode of "Voices of Wall Street" is a reflection of not just the market's appetite for companies offering fractional shares of things, but of just how expensive homeownership has become.
What it means: Pacaso, a startup that allows multiple people to co-own a second home, is betting that the growing lack of affordable housing is a problem that extends even to upper-income families and individuals.
"Many, many people aspire to second home ownership but for most people, it doesn't make sense to own all of a second home, either because it's too expensive or you don't want the hassle of all of that or you won't be using it enough," Rascoff says in the interview.
"So if you want a place in Tahoe or Scottsdale or Napa Valley or Aspen you can buy a quarter of a home through Pacaso or an eighth of a home through Pacaso and then you co-own that home with a couple other families."
How it works: Pacaso marks up home prices by 10% to 12% and owners pay a 1% fee to manage the property, which is purchased as an LLC split between the co-owners.
How is this different from a timeshare?
Phoenix61
(16,999 posts)Buckeyeblue
(5,499 posts)Only it may be a little easier to get out of than a time share.
hack89
(39,171 posts)With a time share you are buying the right to use a property. With fractional ownership you are actually buying the property. One big advantage of fractional ownership is that, as an owner of the property, if the value of the property increases then the value of your share also increases. That doesn't happen in a time share.
3Hotdogs
(12,358 posts)Luciferous
(6,078 posts)tanyev
(42,541 posts)Merlot
(9,696 posts)Hugin
(33,106 posts)Stupid telemarketing calls starting in 5... 4... 3... 2...
Hey, what's a quarter of $1 million? $250,000.
Rich people problems.
But.... Maybe they'll have those free weekends, if you attend our sales pitch deals. If your sales resistance is high it's a great way to spend some time in Reno.
underpants
(182,725 posts)Gotta check this out later.
hack89
(39,171 posts)With a time share you are buying the right to use a property. With fractional ownership you are actually buying the property. One big advantage of fractional ownership is that, as an owner of the property, if the value of the property increases then the value of your share also increases. That doesn't happen in a time share.