01 - It’s Rental with Equity Ownership
The Housing model is broken.
While it's a great investment for some, it's an uphill battle for those starting out or seeking affordable living. This situation has been brewing for years, exacerbated by higher interest rates and income-housing value disparities.
The current system is layered by services, and incentives that prevent any quick change. And low supply issues are met by a glut of investors, leading to instability.
Tweaking the same old model won't yield different results; it's time for a fresh outlook on housing. Let’s break it down…
What do you really want in a place to live:
You want a comfortable, safe, healthy, social, and growth-promoting living space.
Financial reassurance that your housing fits into your financial plan without stressing other aspects of life.
Pride in your living space, reflecting your identity and status.
A place that's easy to maintain and minimizes responsibilities.
So what do we have as options now?
Ownership is heavily promoted, but the true costs often remain hidden. Separating housing from financial investing points to better options. Financial institutions, government incentives, real estate agents, and the media all favor ownership. The rental market stagnates as a result. Renting is often seen as a stepping stone, yet 33% of non-homeowners think they'll never own.
Right now your housing options are:
Owning a house
Owning a condo with shared amenities and maintenance
Renting
And some alternative models like co-op, rent-to-own, or co-owning.
This is not including venturing into small scale developments or the landlord business to make the numbers work.
What if there was a new model…
No more deeds and loans;
It's Rental + REIT Equity Ownership
NewHouse is to housing what WeWork and Regus are to office space.
Newhouse combines two well known models; high quality purpose-built rentals with REIT investment. Every month, a portion of your rent goes into the real estate investment trust (REIT) that operates the home you live in, akin to homeownership forced savings. The tenant vs. landlord dynamic vanishes as you become both user and investor, contributing to the building's success and fostering community.
Big Upside:
No hefty down-payment, real estate agent fees, or legal expenses.
Say goodbye to maintenance and upkeep hassles.
Build equity every month while enjoying a sense of ownership and community.
The Best Part:
When it's time to move, simply give notice and go.
You can keep your REIT shares as an investment or sell them, giving you flexibility and control.
Here’s the Pitch:
Embrace the future of housing with NewHouse – where equity, convenience, and community come together to redefine homeownership.
Critique:
While this model is intriguing, it may not be the sole driving factor influencing individuals when choosing a place to live. The decision driver often revolves around finding a beautifully designed space with abundant natural light, high-quality materials, in a desirable location, and a thriving community. It's about creating a place where you genuinely want to live. Building equity and feeling a sense of ownership are valuable bonuses. This way, you're not only enhancing your living situation but also making a savvy financial move, no longer feeling like you're just contributing to your landlord's mortgage.
What do you think of this model? would this make renting a better option? would you be interested in developing this model further?