Would you buy a rental property you’ve never seen?
Investors are betting on it. HomeUnion, a company that aims to make buying single-family rental homes as easy as buying and selling stocks, has raised an additional $16 million in a Series B funding round, bringing its total funding to $23 million.
HomeUnion finds properties it thinks will yield generous returns as single-family rentals, lets investors buy those properties from afar with the option to use financing facilitated by HomeUnion and handles rent collection and upkeep on investors’ behalf.
The company previously said that it employed salaried real estate agents to find and bid on properties. Asked through email how many agents HomeUnion employs, the firm only said that, “we have boots on the ground in every market we operate and are licensed in every market we operate.”
HomeUnion says it cover 17 locations across the country.
“HomeUnion has disrupted real estate investing by creating an end-to-end investing experience that’s unencumbered by geographical barriers,” said Akhil Saklecha, a partner with venture fund Artiman, in a statement.
“Its hands-off approach allows investors to buy properties remotely like stocks or bonds, making real estate investing a viable alternative to build wealth.”
Source: HomeUnion
HomeUnion’s latest funding round included participation from Artiman, Colchis Capital, Northgate Capital, and Tamarisc.
The raise marks the latest vote of confidence in platforms that make it easy for small investors to buy and sell single-family rental properties.
Roofstock, a similar service, recently announced that it had raised more than $13 million in funding.
Roofstock CEO Gary Beasley previously told Inman that the primary difference between Roofstock and HomeUnion is that Roofstock, which offers a 1 percent referral fee to real estate agents for sending business its way, only enables investors to purchase single-family rentals that are already occupied by tenants.
HomeUnion, however, advertises for-sale listings to investors that it believes would be profitable as single-family rentals and then buys and converts those properties to single-family rentals on an investor’s behalf, Beasley said. Then, it manages those properties for an investor.
HomeUnion emphasized in an email statement that it’s an “end-to-end real estate investment and management firm.”
Unlike Roofstock, which HomeUnion said is only a sales platform, HomeUnion will buy, rehab (if necessary) and manage rentals on an investor’s behalf. HomeUnion even has a lending division that will provide financing to investors that buy homes through the platform.
HomeUnion also said that “in some cases” it sells tenant-occupied single-family rental properties, which is Roofstock’s focus.
HomeUnion’s new funding will enable it to “develop more online tools to analyze the performance of rental homes on a granular level — by neighborhood,” in addition to bolstering its existing services, said Don Ganguly, CEO of HomeUnion, in a statement.
Beyond presenting “personalized portfolios of high-quality, pre-vetted rental properties” based on an investor’s “needs and risk profile,” HomeUnion:
- Identifies the best funding source for a single-family rental investor, “whether that’s cash, an IRA or financing, and then facilitates the process.”
- Buys property on behalf of an investor and completes all paperwork online.
- Manages an investor’s property through an “in-house asset-management division.”
- Tracks property information and “return analysis.”
- Helps an investor decide when to sell.
Editor’s note: This story has been updated with comments from HomeUnion.
