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Acre Homes, a company that calls itself a consumer-led home ownership solution, has raised its funding to date to $10 million with the closing of a seed round led by Anthemis, Inman learned in a December announcement.
The specific amount of the latest funding round was not disclosed. Inman contacted Acre for comment on the money.
Several funds participated in the new seed round, including Sovereign’s Capital, Home Technology Ventures, Studio VC, Front Porch Ventures, Unpopular Ventures, Duke Capital Partners, and former Invitation Homes CEO Fred Tuomi.
Acre’s model is based on other funds. It provides equity building through three- to five-year short-term mortgages on homes it buys for its clients. It offers low fees, usually five percent, paid per Acre.
Buyers can choose to buy an Acre home at the end of their first term, use their “share of value” in the price, transfer that share to another Acre home or leave it with them.
The announcement said Acre customers have on average “saved $9,000 in purchase costs, and are expected to benefit from an additional $50,000 in ongoing savings and home appreciation.” The latter figure is based on an average annual appreciation rate of four percent over three years.
The company’s model offers buyers a range of product iterations based on changing equity percentages, terms and time periods. Interested agents are advised to spend time in the company’s FAQ section.
“Acre’s base product is 10 percent cheaper than a monthly mortgage and guarantees 10 percent of the home’s total value while you live there,” its website says. “You’ll also be able to choose to benefit from Acre’s premiums where you give up 10% of your monthly savings on 50% of the home’s total value while you live there.”
The National Association of Realtors states that the average length of time a person lives in their home is just over 12 years. Acre targets buyers who intend to stay for a short period of time, usually three to five years.
Acre founder and CEO Mike Schneider said in a statement that the team is very pleased to receive its latest investment, “especially given the challenges of the current fundraising environment.”
“We founded this company because buying a house no longer makes sense for a growing number of Americans,” said Schneider. “Compared to a mortgage, Acre delivers an exceptional home buying experience and compelling financial results. This round enables us to increase our reach and impact on homebuyers.”
Funding in its latest seed round will be directed toward mainstream growth, the company said. It recently launched its second market in Atlanta after launching in Raleigh and Durham, North Carolina, in 2021.
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