In fact, between maintenance, upkeep, taxes, the hassle of finding short-term tenants, and usually a small number of days a year, the owners are actually in residence, vacation homes are generally a great way to create memories and a bad way. spend your money.
Now, two Zillow veterans have a new twist on second homes: They want to match you with like-minded buyers so they own how much of the home you’ll actually use. His company, called Pacaso (which is pronounced in honor of the painter), launched this week. The president of Pacaso is the co-founder and former CEO of Zillow, Spencer Rascoff; Its CEO is Dotloop founder and former Zillow executive Austin Allison. The company says it has raised $ 17 million in Series A funding, from investors including Maveron, Crosscut, Global Founders Capital, Howard Schultz and other executives at Zillow and Amazon. The startup has also secured $ 250 million in debt financing to buy home stocks.
Allison says Pacaso is addressing a basic mismatch in the market. “Ten million people own second homes in the United States. Most of them remain vacant for 11 months out of the year. Meanwhile, there are tens of millions of people who aspire to have a second home, but cannot afford it, “he told.
So how do you find your dream home? On the Pacaso site you can fill out a form with the desired location and price range. Next, Pacaso works with local real estate agents to find a home that meets their criteria and matches it up with other buyers looking for a similar hideaway. (From now on, Pacaso only deals with turnkey houses, not repairmen). If Pacaso finds a group or individual who wants 50% of a property, they will establish an LLC for you and then immediately buy the other half to speed up the deal.
For a 1% annual fee based on purchase price, Pacaso will take care of all the annoying details of managing a property from afar, from paying for utilities to finding a plumber to come fix a leaky faucet. Part of each monthly fee is set aside for future repairs and maintenance, like that new roof that Pacaso’s algorithm estimates you may need in, say, 17 years. At tax time, all homeowners will simply get a K-1.
The owners will never interact or meet, although Allison said that at one of the company’s first homes in Napa, California, a family invited their friends to visit and the other family quickly bought the last remaining piece of the house. .
Allison calculated one of the company’s first sales, a $ 1.9 million home in Napa. Operating costs, including taxes, would be around $ 40,000 a year. But Pacaso divided this particular house into 8 shares, with a tranche of just $ 117,000 down (they work with First Republic bank to provide owners with up to 50% financing). Monthly costs are $ 600 for every eighth of a share.
With each Pacaso property, owners reserve time on a continuous 24-month calendar through the company’s app, with an algorithm that calculates how many important vacation days and the total time each owner has to “spend.” Part of the idea, Allison says, is to connect a diverse group of homeowners. But a family with kids, plus a few retirees, plus a couple like Allison and his wife who prefer the less crowded middle seasons in Tahoe are starting to make more sense and fill the calendar.
The company is launched because real estate has been an industry that has defied typical patterns of a recession and has grown dramatically since March, as Shawn Tully described in a recent story. Housing Center and former director of credit at Fannie Mae. Buyers cannot buy houses that are not for sale, so the prices of the relatively few on the market are rising. That means the price increases will continue to work until there is more inventory. And the new offer will come slowly. In the article, Pinto predicts that prices will remain high until a wave of foreclosures finally puts an end to the party. But in the meantime, those high prices make second homes less affordable, which could make the Pacaso model more attractive.
Moving forward, Allison says Pacaso will move to offer “enhanced personalization,” where her clothes will be placed in the closet and her favorite wine will be on the counter prior to her arrival. For now, each owner is guaranteed a locked closet where they can store personal items and equipment, such as skis or golf clubs.
As for Allison, he and his wife already own a second home in Lake Tahoe, but he doesn’t plan to split the shares since he spends half the year there.
But he still aspires to be a Pacaso client. “I’m going to buy a Pacaso in Scottsdale. I’m shopping right now, “he says with a smile.
