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The Rise of Renters

The Rise of Renters
May 2, 2022

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Housing is on my mind, and chances are, it is for you too. You're either considering your home’s value in this seller’s market, watching your mortgage pre-qualification expire as rates rise, or looking for an apartment at prices 30% higher less than a year ago. For me, it’s the latter situation. I’m looking to rent in one of the hottest cities in the country, and rent for a one-bedroom apartment is steeper than ever.

 

Supply and demand
Why are we seeing a squeeze in inventory? For starters, homebuilding hasn’t been able to keep up with demand. Moreover, restrictive zoning policy has made it harder to add an ADU (attached dwelling unit) to existing homes. Investors are also buying up homes at a record pace, using them as rentals or Airbnbs. Lastly, more and more banks are becoming landlords at the same time as many millennials are settling down.

On the bright side, wherever there is a pain point, there is an opportunity, and many entrepreneurs are pitching their solutions and finding their customers. 

A place to call home
When you’ve been taught that owning your home is a wise investment, but don’t have the down payment in hand, Divvy offers prospective buyers a way to compete in today’s market. The company is offering a rent-to-own model that will secure a home in an all-cash offer. The company has mixed reviews from the Better Business Bureau, but its investors are behind the concept, floating $1.2BN to reach more customers.
 

Up&Up is another start-up that plays on the adage that rent is throwing away your money. The company will rent you a property, and your dollars will accrue towards a down payment to buy. It’s an attractive premise backed by top-name investors. Too bad the offering is only in St. Louis, Atlanta, and Indianapolis (for now).

For people searching for the amenities of a mansion without the staff payrolls and property taxes, there is Alfred. The start-up offers renters a personal-assistant-esque service, coordinating laundry, cleaners, and even a social life, by curating events with other residents.

Stay tuned for the rental investment side of real estate tech.

Since last week, PrivCo has added:
1,004 Companies | 307 Funding Activities | 179 M&A Deals

Funding & Deal Highlights:
 

Taxfix raises $220MM from Teachers’ Venture Growth

Accounting • Round D • Berlin, Germany 
 

OneFootball raises $300MM from Liberty City

Sports • Round D • Berlin, Germany
 

Brimstone raises $55MM from Breakthrough Energy Ventures

Environmental • Round A • Oakland, CA 
 

Apertura raises $67MM from Deerfield

Drug Research • Round A • New York, NY
 

Inventa raises $55MM from Greylock

E-Commerce • Round B • Sao Paulo, Brazil   
 

Madison Reed raises $33MM from Sandbridge

Hair Care • Equity • San Francisco, CA
 

Movable Ink raises $55MM from Silver Lake

Digital Marketing • Round D • New York, NY 
 

Ashvattha raises $69MM from Huadong

Biopharmaceuticals • Round B • Redwood, CA
 

Kard raises $23MM from Tiger Global

Fintech • Round A • New York, NY
 

Primer raises $15MM from Keith Rabois

E-Learning • Round A • San Francisco, CA  
 

May River Capital announces acquisition of Spirolow

Equipment • Acquisition • Monroe, NC 
 

Blackhawk acquires JJ Industries of Connecticut

Industrial Products • Acquisition • Southington, CT

 

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