Assess their risks, liquidity, returns, and timeframes
Landa's minimum share investment is $5, with personal buy limits set at 10% of income/net worth per property, no limits for entities, and weekly deposits capped at $100,000.
Investing in Landa carries risks such as market volatility and potential loss of investment. Despite Landa's measures to legally separate each property series to protect investors' assets, there's no absolute guarantee in bankruptcy scenarios.
Investing in Arrived carries risks including market fluctuations, economic factors, and property-specific issues. There's also the potential for loss, and investments are generally illiquid, meaning they can't be easily sold or exchanged for cash quickly.
Landa offers share liquidity through its trading platform, with market hours set from 9:30 am to 5:00 pm EST and a 2% trade fee. Share pricing is flexible, but an active buyer market is not guaranteed.
Arrived is designed for long-term investments with limited liquidity options. The Single Family Residential Fund offers share redemption after six months with restrictions. For individual properties, shares are held until the property is sold, typically after 5-7 or 5-15 years. A secondary market for shares is being considered but is not currently available.
Landa offers returns through rental income distributions and potential property value appreciation, with additional tax benefits. Returns are influenced by property location, type, and market conditions, shaping overall investment performance.
Arrived investors may earn returns through monthly rental income dividends and property value appreciation upon sale, with historical annual return estimates ranging from 5.5% to 15%, depending on the property type and use of leverage.
Landa focuses on long-term property investment, with the potential for indefinite holding periods due to market liquidity or property performance.
Arrived targets a 5-7 year hold period for Single-Family Residentials and a 5-15 year hold period for Vacation Rentals, emphasizing a long-term investment horizon.
U.S. residents over 18 with an SSN can invest with Landa, excluding non-U.S. residents and those in Puerto Rico.
U.S. citizens or residents who are at least 18 years old can invest with Arrived, and accreditation as an investor is not necessary.
Real estate values can fluctuate unpredictably, impacting Landa share prices and potentially leading to significant investment losses in volatile markets.
Real estate assets on Arrived can be subject to market volatility influenced by economic shifts, interest rates, and local market conditions.
Landa's "Shares" are SEC-regulated real estate investments with risks, including loss and illiquidity. Resale of Shares is limited to a secondary platform with no guaranteed market, requiring investors to potentially hold shares indefinitely.
Arrived's offerings are regulated by the SEC, requiring compliance with securities laws and provision of detailed offering circulars to investors. Audits and financial reviews are conducted for transparency.
Without specific details from Landa, it's assumed properties are insured for damage, not for market or fraud risks, with potentially limited coverage.
Arrived properties are insured against physical damage or loss, but insurance may not cover all risks and does not protect against market volatility, economic downturns, or other investment-related losses.
Landa investors earn through monthly dividends derived from rental income minus property expenses and through potential appreciation by selling shares in a secondary market. However, dividends are not guaranteed, may fluctuate with property performance, and share trading is subject to market availability.
Arrived pays out dividends monthly, with single-family residential properties historically averaging 45 days to lease and vacation rentals taking 3-6 months to start generating income. The first dividend payment for the Single Family Residential Fund is scheduled for February 25th for investments made by December 31st, and it may take up to 60 days to receive the first dividend after investing. Subsequent dividends are paid monthly, near the end of the month.
Landa charges a 2% fee for share transactions on the secondary market, paid to a third-party broker-dealer without any retention by Landa.
For long-term rentals, Arrived charges an 8% management fee on gross rental income. Vacation rentals incur a 15-25% management fee. Additional fees include a one-time sourcing fee (3.5% for long-term, 5% for vacation rentals), and a quarterly Asset Management Fee (0.25% for the fund, 0.15% for long-term rentals). Other costs may apply for closing, renovation, and operating expenses.
Landa provides investors with tax documents such as Forms 1099-B, 1099-DIV, and 1099-MISC by January 31st for reporting share transactions and dividends over $10. Income from Landa investments is taxable, and consulting a tax professional is recommended.
Arrived sends investors a 1099-DIV form by the end of January for tax reporting, and state taxes are based on the investor's state of residence, not the property's location. Vacation rentals are taxed similarly but do not qualify as a REIT.