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If you want to reach your goals, you need to ensure that the money you’re working so hard for ultimately works for you. Interest is how we earn money on our savings and investments, but how this interest is calculated can be the critical difference between whether your money’s growth is stagnated or exponential.There are two basic ways that interest is calculated: Simple interest and compound interest.Let’s focus on compound interest — what it is, why it’s important, and how to reinvest your dividends to maximize your earning potential.&nbsp;<h2>What Is Compound Interest?</h2>There are two ways interest is typically calculated:<ul><li>Simple interest</li><li>Compound interest</li></ul>Simple interest is when a set percentage is applied to the principal amount each year. For instance, if you invest $1,000 at 10% for five years, you’ll receive 10% on the original principal, that is, $100, in interest every year for five years.&nbsp;Compound interest, on the other hand, is earned when you reinvest your earnings. If you were to take that $100 you earned in interest in the first year and add it to the principal in the second year, the amount of interest would be calculated on $1,100, not the original principal. You’re earning interest on interest, which can add up significantly over the years.&nbsp;The power of compound interest is in how quickly it can multiply your money. Compounding periods, or the number of times you allow the interest to be compounded, are critical to this accelerated rate. The longer you leave your investment to compound, the higher and faster your money will grow.<h2>How Compound Interest Works</h2>Albert Einstein called compounding the eighth wonder of the world, and Warren Buffett famously amassed his vast fortune on compound interest. Over an extended period, money being compounded can grow exponentially when interest is earned on years of previous interest earnings. There are, however, a number of elements that factor into compound interest:&nbsp;<h3>Initial Principal</h3>The initial amount is where it all begins. 5% interest earned on an investment of $10,000 will look very different from 5% interest earned on a $100,000 investment. That said, while the principal amount matters in how much you earn, start from where you are. You don’t need a large amount of money to benefit from the principles of compound interest.<h3>Interest Rate</h3>Your annual interest rate on your money significantly impacts how much it will grow. If you’re earning 1-2% in a savings account, that money will grow far slower than if you were earning 5% or 10%.&nbsp;<h3>Frequency of Compounding</h3>Interest is compounded on a given frequency schedule. For some investments, compounding frequency is daily. For others, it can be monthly or annually. Frequent compounding will allow more opportunities for your money to grow.<h3>Compounding Periods</h3>How long are you planning on keeping your money invested? The answer to this question will determine how much your money can grow. If you withdraw your money after five years of compounding, it will have much less opportunity for growth than if you were to leave it for ten years or more.&nbsp;<h2>The Power of Reinvesting Your Dividends&nbsp;</h2>Reinvesting dividends can be a powerful strategy for maximizing wealth growth over the long term.&nbsp;For example, if you invested $10,000 at 8% interest, you’ll likely walk away with more money than you started. Not too shabby.&nbsp;But you could amplify that strategy even further by reinvesting the dividends you receive from your initial investment. When you reinvest your dividends, you're essentially putting the money you receive back into your investment. This means that not only does your original investment grow over time, but the earnings from your dividends also start generating their own returns. These new earnings then get added to your investment, allowing it to grow even faster.&nbsp;It's like a snowball effect – the more you reinvest, the more your investment grows, thanks to the power of compounding. So, by reinvesting dividends, you're not just earning interest on your initial investment; you're earning interest on the interest.<img src="https://cdn.builder.io/api/v1/image/assets%2Fe2f096ba17f74dfd9c140ac050f349a4%2Fa088bd61ec70437c8fffaf968cccfbe7">If you want to accelerate your earning potential even further, you could make additional investments. With each monthly contribution, you inject more money into your investment, potentially allowing it to grow faster.These additional funds further enhance the compounding effect when combined with reinvested dividends. Not only are you earning returns on your original investment and reinvested dividends, but you're also earning returns on the new monthly contributions.Check out the chart below to see how even a $150 monthly additional investment can factor into your compound interest growth.&nbsp;<img src="https://cdn.builder.io/api/v1/image/assets%2Fe2f096ba17f74dfd9c140ac050f349a4%2F8e1c8f92f1d04610908d2107afe8fc53">Understanding compound interest and the power of reinvesting dividends is essential for anyone looking to build long-term wealth. While simple interest offers straightforward growth, compound interest has the potential to multiply your money exponentially over time. By reinvesting dividends, you're not only earning interest on your initial investment but also on the earnings generated from those dividends, leading to accelerated growth.Remember, the key to maximizing the benefits of compound interest is time. The longer you allow your investments to compound, the greater the potential for wealth accumulation. So start early, stay consistent, and harness the power of compound interest and reinvested dividends to secure your financial future.At Arrived, our mission is to provide financial freedom for everybody, and we do this by allowing you to <a href="https://arrived.com/blog/how-it-works/" rel="noopener noreferrer" target="_blank">purchase shares in rental properties</a>. Through our platform, you can purchase shares of rental properties and start building a portfolio today.&nbsp;

What Is Compound Interest?

As part of our ongoing commitment to providing secure and reliable services, <a href="https://arrived.com" rel="noopener noreferrer" target="_blank">Arrived</a> is excited to announce the implementation of two-factor authentication (2FA) for all user accounts. Understanding the importance of security, we want to ensure that our investors and users know why we are implementing this feature and how it benefits them.<h2>What Is Two-Factor Authentication?</h2>Two-factor authentication (2FA) is a security process in which users provide two different authentication factors to verify themselves. This process is done to better protect both the user's credentials and the resources the user can access. 2FA helps to ensure that the person trying to gain access to an online account is who they claim to be. First, a user will enter their username and password. Then, instead of immediately gaining access, they will be required to provide another piece of information.&nbsp;Arrived’s two-factor authentication works to keep your account secure by using a combination of your Arrived login and a secondary method. You can opt for:<ul><li>Authenticator app: An authenticator app generates secure, time-sensitive codes that users input along with their password to access online accounts, enhancing security through two-factor authentication.</li><li>SMS code: You can also request a unique SMS code for two-factor authentication. This code will be sent via text.&nbsp;</li></ul><h2>Two-Factor Authentication Benefits&nbsp;</h2>There are many benefits of two-factor authentication, including:<h3>Enhanced Security</h3>By requiring a second form of identification, 2FA makes it significantly harder for potential intruders to gain access to a person's devices or online accounts. Knowing the victim's password alone is not enough to pass the authentication check.<h3>Reduced Fraud and Identity Theft</h3>2FA provides an additional security layer that helps shield the user's identity and personal data. This means safer transactions and less chance of identity theft, as the second-factor verification will alert users to any unauthorized attempts to access their account.<h3>Ease of Implementation and Use</h3>Two-factor authentication is straightforward to implement and does not require significant technical knowledge from the user’s standpoint. Most people are already familiar with receiving a code on their phone or using a fingerprint to verify their identity, which makes this transition seamless.<h2>Dedicated to Security&nbsp;</h2>The implementation of two-factor authentication is a critical step in enhancing the overall security of our platform. It not only helps in protecting personal and financial information but also boosts user confidence in our system. As we move forward, we will continue to prioritize security and ensure that our investors and users have the safest possible experience with <a href="https://arrived.com" rel="noopener noreferrer" target="_blank">Arrived</a>.If you’d like to enable two-factor authentication on your Arrived account, visit <a href="https://help.arrived.com/en/articles/7727155-how-do-i-turn-on-2-step-verification-authentication-for-desktop-mobile-browser-or-the-arrived-ios-app" rel="noopener noreferrer" target="_blank">our FAQ page</a> for a step-by-step guide.

Announcing Two-Factor Authentication 

The Arrived Single Family Residential Fund was launched in Q4 2023 to provide investors with an easy way to invest in a portfolio of single family residential properties. We believe this asset class has solid fundamentals and long-term growth potential, making it an attractive investment opportunity.Investing in the Arrived Single Family Residential Fund offers investors instant exposure to several hand-selected properties in markets nationwide. The Fund is structured as a private real estate investment trust (REIT) managed by Arrived.&nbsp;<h2>Investment Strategy</h2>We believe the single family residential market is a compelling investment for a few reasons. It is a vast market — over <a href="https://www.census.gov/construction/nrc/pdf/newresconst.pdf" rel="noopener noreferrer" target="_blank">100 million</a> in the US alone — worth more than <a href="https://commercialobserver.com/2022/03/single-family-rentals-strong-future-demand-drivers-to-propel-sector-outperformance/" rel="noopener noreferrer" target="_blank">$30 trillion</a>. It is also driven by many positive factors, such as population growth, job growth, and <a href="https://home.treasury.gov/news/featured-stories/the-purchasing-power-of-american-households" rel="noopener noreferrer" target="_blank">rising incomes</a>. And because it's not dominated by just a few big players, there are chances for investors to buy properties at reasonable prices.To achieve our investment goals, we focus on two primary objectives: providing investors with a steady income stream and offering the potential for long-term asset appreciation. We do this by acquiring single family rental properties in dynamic markets with significant growth potential. We also aim to increase property value over time through efficient property management and fostering positive relationships with long-term renters.Specifically, our approach entails:<h3>Investment Objectives</h3>Our investment objectives are to provide consistent cash flow and pursue long-term capital appreciation. We achieve these goals through a strategy of moderate leverage, wherein we carefully utilize borrowing to acquire properties while maintaining balanced debt levels relative to asset values. This approach can enable us to generate reliable income streams from our investments while aiming for sustained asset value growth. Additionally, we prioritize optimizing returns through favorable tax treatment of REIT income and long-term capital gains.Responsible risk management is central to our investment strategy, focusing on capital preservation alongside growth objectives. We recognize the importance of shielding investors' capital from undue risks while striving to achieve attractive returns over time. By carefully balancing risk and return, we aim to offer an investment opportunity that provides both steady income and the potential for long-term wealth accumulation.<h3>Market Criteria</h3>In selecting markets for the Arrived Single Family Residential Fund, we prioritize areas that meet specific criteria conducive to sustainable growth and profitability. Our focus centers on the top 200 Metropolitan Statistical Areas (MSAs) to target regions with robust economic activity and growth potential. We seek markets with sufficient inventory to support scalability, which is defined as having at least 50 homes available for acquisition, allowing us to build a substantial presence and operational efficiency within the local market.Additionally, we assess the market's job and income growth forecasts, prioritizing regions experiencing positive trends in these areas. Affordability is another critical factor, with a focus on markets where the gross rent multiplier is below 15, indicating a reasonable ratio between the price of homes and their rental income potential. We consider the presence of a large, skilled workforce and increasing demand for housing units to ensure sustained rental demand. We also evaluate the competitive landscape, favoring markets where competition from other buyers is manageable.To ensure proper diversification and mitigate concentration risk after we have raised at least $20 million of net offering proceeds, we do not intend to invest more than 25% of our net offering proceeds in any particular MSA.<h2>Market Commentary and Outlook</h2>The single family residential market has remained resilient even amidst challenges like high mortgage rates and persistent inflation. As rates are forecasted to remain high, we’re focusing on specific markets, predominantly in the Southeast, that exhibit fundamental characteristics necessary for growth. The new home market continues to be attractive due to the interest lock-in effect constraining resale supply. A low supply of construction labor and high material costs steer our acquisition strategy towards new homes in an effort to minimize future spend on the investments. We find compelling value in new neighborhoods that are on the path of progress as cities expand.As we approach the high leasing season, the industry forecasts project a promising outlook, with expectations of 3% or more rent growth for 2024. Our rental strategy focuses on 2-year leases with term expirations in the spring months.<h2>Summary of Fund Activities and Key Metrics</h2>The Arrived Single Family Residential Fund was launched on November 29, 2023. In Q1 2024, the fund received $6.6M in investments, resulting in a total of $9.8M since launch at the end of November 2023 and 11,742 investors for an average AUM per investor of $833.This funding has enabled us to accumulate a portfolio of 33 properties for a total purchase price of approximately $10.7 million.&nbsp;Of the 33 properties owned by the Arrived Single Family Residential Fund:<ul><li>Stabilized properties: 20*&nbsp;</li><li>Leased: 19&nbsp;</li><li>Average lease term: 2 years&nbsp;</li><li>Stabilized occupancy: 95%&nbsp;</li><li>Leases signed at a premium: 74% with an average 5.5% premium</li><li>Total markets: 18&nbsp;</li></ul>*Arrived defines a stabilized property as one that has been leased or has been rent-ready for over 90 days.&nbsp;<img src="https://cdn.builder.io/api/v1/image/assets%2Fe2f096ba17f74dfd9c140ac050f349a4%2F4cd0006141204f70914c7f371b539197"><h2>Dividends and Share Price</h2>During Q1 2024, the Arrived Single Family Residential Fund's net returns represented +0.7% for the quarter in combined dividends and share price appreciation. The Arrived Single Family Fund paid $65K in dividends and earned an annualized dividend of 4.0%.The Fund's share price debuted at $10. Following our initial acquisitions in Q1 2024 and necessary adjustments, including fair value revisions and fee adjustments, the share price now stands at $9.97. This price will remain unchanged until our Q2 NAV/Share update.The share price adjustment in Q1 2024 can be attributed to several factors inherent in the fund's initial operational phase. During an initial ramp-up stage, funds often take time to become stabilized. The Fund's income statement comprises revenue from rental income and expenses related to managing assets and operating the fund. With a significant portion of non-stabilized assets still vacant, property-related expenses outweigh property-related revenue, compounded by fund-related expenses that must be incurred.This imbalance between revenue and expenses is typical for funds in their early stages. As the fund expands and its portfolio grows to support additional property-related expenses, this initial net loss trend is expected to diminish, eventually transitioning into profitability.&nbsp;Additionally, property valuation increases totaling approximately $215k, based on automated valuation models and market assessments, were incorporated into the share price update. These adjustments are accompanied by amortization and adjustments of one-time recognized and forecasted fees and expenses, including offering, sourcing, and disposition fees.Ultimately, the confluence of these factors contributed to the decrease in the share price by 0.34%, approximately $0.03, reflecting the fund's current operational dynamics and trajectory toward long-term growth and profitability.<h2>Looking Ahead - Opportunities and Plans for 2024</h2>We are excited about the opportunities that lie ahead for the Arrived Single Family Residential Fund. Over the coming months, several strategic initiatives are planned to enhance the Fund's performance further and maximize return potential.&nbsp;We will continue to actively acquire properties in attractive markets, capitalizing on opportunities for growth and value creation. This strategy involves thorough market research and strategic decision-making to ensure each acquisition contributes positively to the Fund's overall performance.We recognize the importance of streamlining processes to improve overall performance and optimize return potential. We are committed to enhancing the Fund’s operational efficiency. We also aim to expand our investor base, welcoming new investors who share our vision and desire for long-term wealth accumulation.Looking forward, we expect that the properties acquired during this period will play a vital role in driving substantial returns, especially as interest rates are expected to come down.We firmly believe in the power of patience and long-term planning, recognizing them as fundamental principles for achieving success in investing.

Arrived Single Family Residential Fund Q1 2024 Summary

Welcome to Arrived’s Q1 2024 review! Let’s review the dividends and appreciation of the 358 Arrived properties operating during Q1 2024.In Q1 2024, investors earned more than&nbsp;$1.1MM&nbsp;in dividend income, an increase of approximately 16% from Q4 2023. In total,&nbsp;352&nbsp;individual properties paid out dividends. In Q1 2024, single family residential properties earned an average annualized dividend of&nbsp;3.8%. Vacation rental homes earned&nbsp;3.4%&nbsp;on average. The Arrived Single Family Residential Fund earned an average annualized dividend of&nbsp;4.0%.&nbsp;<img src="https://lh7-us.googleusercontent.com/lbRLv6lbUpfIKNhRf-4KxpqhBPVZYa7zV03KZUzEYaA2yxGKCTIcSKo8njPXE6rzinXScyga2BjHXZaFmfuL34G13GT3upiVzHLiyv7CbarB0XJGV_Z4fANq3aR-QTi_ix5VrjpKqdmEvE4nlXZcKYA"><h2>Product Updates</h2>Arrived has launched Cash Balance to pay dividends directly to an investor’s Arrived account. With the launch of this new feature, we’ve unlocked our ability to pay dividends monthly instead of quarterly — one of our most highly requested features from investors. As an Arrived investor, you’ll also have easy access to your Cash Balance to reinvest in new offerings (potentially creating more compound returns over time) or withdraw your dividends into your account anytime. <a href="https://arrived.com/blog/arrived-wallet" rel="noopener noreferrer" target="_blank">Click here</a> to learn more about Cash Balance.In line with our commitment to transparency and accessibility, we've revamped our property pages to include a comprehensive property timeline for all single family residential properties and vacation rentals. Now, investors can track key property updates at a glance at the top of the Performance tab.&nbsp;&nbsp;Arrived has also implemented <a href="https://arrived.com/blog/two-factor-authentication" rel="noopener noreferrer" target="_blank">two-factor authentication</a> across all investor accounts. This crucial step strengthens our ability to better protect investor assets.&nbsp;<h2>Dividends</h2>Dividends earned can vary by investment. In Q1 2024, 315 individual single-family residential properties paid a dividend between 1.2% and 9.3%, with a 3.8% annualized average. 37 vacation rentals paid a dividend between 2% and 6.3%, with a 3.4% average. The Arrived Single Family Residential Fund earned an average dividend of 4.0%.Read more about the Arrived Single Family Residential Fund performance in our Q1 2024 Summary <a href="https://arrived.com/blog/arrived-single-family-residential-fund-q1-2024" rel="noopener noreferrer" target="_blank">here</a>.&nbsp;You can view the dividends for each individual property on our <a href="https://arrived.com/returns" rel="noopener noreferrer" target="_blank">Historical Returns</a> page.<img src="https://lh7-us.googleusercontent.com/yvEaHFCn6QMUaPQR5TfbowivTR3CIEQFykcu2kHKYWAaAuAsMXK6trSkbJHLzoAfAfzXjTIh3wU93y_nG3fHjnh91tyCP9eE8V5VTGiTYGrl6MvFYax1H0dFJLVl5xyCevfRhMzZElTQHAOu62ioDOY">The annualized dividend for each individual property is calculated by taking the Q1 dividend and extrapolating it out for an entire year. Building a diversified portfolio across multiple markets is a great strategy to minimize risk while getting exposure to different real estate markets and earning passive income.The chart below shows the combined realized dividends and unrealized appreciation of single family residential properties and vacation properties.&nbsp;<img src="https://lh7-us.googleusercontent.com/62GmRpTIZNwHw8vIyokKpWFfEMxU4wN3qh5M8G0nN09jlgmcwXkFY0rSkIhSVn-OO9WJG1TEyTFuH1kvdoHBeQP3NJ4FGrEz3QE2v0vs62inZGd1YODkIEHNRjCxYBBdGQKHHyf_0eFN4VJ6o4wa38M">It's evident that properties typically have lower total returns in the first six months because they have only received dividends and don't have an appreciation update yet. However, approximately half of the properties have positive returns from around six to fifteen months.&nbsp;In the early stages of investing in a single family residential property, macroeconomic factors such as prevailing mortgage rates, the strategic use of leverage, and the prevailing market prices of homes can significantly impact initial total returns. For example, lower mortgage rates can stimulate demand and increase property values, while adding leverage can amplify returns but also heighten risk, and high home prices may delay the realization of profits. It's important to remember that real estate tends to perform best as a long-term investment, allowing investors to navigate through various market cycles and maximize returns.This chart highlights the importance of diversification and <a href="https://arrived.com/blog/dollar-cost-averaging" rel="noopener noreferrer" target="_blank">dollar-cost averaging</a> in the real estate market. Predicting the best-performing property in a cohort at IPO is challenging. Diversifying your portfolio through a combination of different single family residential properties, vacation homes, and funds like the Arrived Single Family Residential Fund can be an effective strategy for mitigating risk.&nbsp;In Q1 2024, 17 properties were added to the Arrived Single Family Residential Fund. More than 11.7K investors have invested $9.8M in the fund since launch. The Arrived Single Family Fund paid $65K in dividends. The Arrived Single Family Residential Fund earned an average annualized dividend of 4.0% in Q1 2024.<img src="https://lh7-us.googleusercontent.com/QjPiG_kyp86oVklTMHA30EebRXmLfNGm2L1NIlK7BIVr33wS5m96Hux1rsir2QECkc9Bv-Y49vd7M12qtR1zUTLWPx5jxSI1V3bgMOolbwoddXBGDK4FYulvcKeXhtglaLY47LzHFj_lTiSCw4-XThc"><h2>Share Prices&nbsp;</h2>In Q1 2024, 284 Arrived properties have a share price. 254 operating properties received an updated share price, while 31 properties received their first share price update.&nbsp;<img src="https://lh7-us.googleusercontent.com/0msitKbVZaFzCSQ9WcUtVlg6kaJfoPWrtjgUAs72My7nVnVIAJYD6E-HyTceomZlvJCCT4UH6JKk2vBRnh4Hii1IuAx-VIWziC4o-A6ByW6MumwOTlmRy_jHPy17NCLD45qTIFHNnPlxv3Nr2LECyac"><a href="https://arrived.com/blog/property-share-prices/" rel="noopener noreferrer" target="_blank">Share Prices</a> are a way to see the value of your investment change over time, much like you would track a portfolio of stocks.A property’s share price reflects both its value and its cash balance. Any actions that affect the cash balance will impact the share price. This could include revenue, vacancy, dividends paid, and different operating expenses. For IPOs, the share price is unrealized until the disposition of the property. You can learn more about how share prices are calculated in <a href="https://help.arrived.com/en/articles/6909386-how-are-share-prices-calculated" rel="noopener noreferrer" target="_blank">our FAQ</a>.&nbsp;<img src="https://lh7-us.googleusercontent.com/g1Z0ZjqiRNoqa8kN5sG9FpAlftEK2CU2FmyYdkyLJnAKX0Yjb0gbDEBJoggCEouAxF-iD0JD-vY10pgbERJyO_rK8-JuZX9NFWz9KbzrBSquOu4AXQyOnKhhRWVFZ41ZpShz6oHIn1AHKpTUvSPwr1A"><h3>Single Family Residential Property Share Prices&nbsp;</h3>In Q1 2024, we updated the Share Prices for 261 properties, including 240 properties receiving an updated share price from 3 months ago and 22 properties receiving their first share price since their IPO 6-9 months ago. The Single Family Residential Fund also received its first valuation in Q1 2024.&nbsp;<img src="https://lh7-us.googleusercontent.com/TUJHcLDRPUFMFu8VLByz70Pod-L5FhP4RT1FZzWlgO15ZzGk5jaGzFxX15ol67mLvANn031MHgNZ2gvEbxqPDlhm_SqX_ig2tiqkl6sHdP8mD3BNTXSqne0X_Y9zxt9PJKFnG_f3GFA2WKucEDumGko">For the 240 properties receiving an updated share price, the share price ranged between -15.9% and 13.5%. That resulted in an average share price change of -1.5% from Q4 2023 to Q1 2024.&nbsp;For the 22 properties receiving a share price for the first time, share prices ranged between -6.4% and -0.2%. That resulted in an average share price change of -2.8% in Q4.The share price range reflects the low, high, and average range for all Arrived single family residential properties. This range may reflect individual properties impacted by specific circumstances, such as <a href="https://arrived.com/blog/how-arrived-manages-evictions-and-unlawful-occupancy/" rel="noopener noreferrer" target="_blank">eviction proceedings</a> or significant maintenance issues affecting the property's cash flow.Single family residential investors can view the performance of individual properties in their portfolio on their <a href="https://arrived.com/app/account/portfolio" rel="noopener noreferrer" target="_blank">Portfolio Page</a>. Investors can also view the offering history of all single family residential properties under the“Performance” section on the <a href="https://arrived.com/app/properties" rel="noopener noreferrer" target="_blank">Property Page</a>.&nbsp;Below is the average Q1 single family residential share price categorized by the number of months owned for each property.<h3><img src="https://lh7-us.googleusercontent.com/Tdd8DQbFTKZQJvFH4TtoMe2mr9WRZk4Uvprt50Ih5Fcxeu2JkQqBGtHz3pwR_FjjXrBt13gAPtYBwuFCsnNc_by8aobP6-NXxCg5R3AeWkD3E922w8TnHLsehqpZVvNb6YSS9S_xbgU9yECIzPtlCmE"></h3><h3>Vacation Rental Property Share Prices&nbsp;</h3>In Q1 2024, we updated the Share Prices for 23 vacation rental properties, including 14 properties receiving an updated share price from 3 months ago and 9 properties receiving their first share price.<img src="https://lh7-us.googleusercontent.com/RI-pQEqwEK6pTCxvSSIjb3RXqag7fs88QHHUzh-Q-sCGMjb_epppptr9uzYkjy0a02yp9FSiEudQyEIRh5-lYoSoChDyf9-SKz4xaoeOE3d058FJ9QdD7dMIKfpQO3vDrC8XKZ3qh62smyakeTBJZvM">The average share price change for the 14 properties receiving an updated share price was -2.9%. The average share price for the 9 properties receiving a share price for the first time was -5.7%.&nbsp;You can learn more <a href="https://help.arrived.com/en/articles/8875837-how-are-vacation-rental-share-prices-different" rel="noopener noreferrer" target="_blank">about how vacation rental share prices differ in our FAQ.</a>The above-mentioned share price range may contain individual properties affected by specific circumstances, such as a shift to a new property management partner.&nbsp;While share prices react to the current market in the short term, real estate performs best as a long-term investment, all while investors continue earning dividends through rental income.*Share Prices for single family residential properties are updated six months after the initial property funding, using estimates provided by third-party sources. Vacation rental properties are updated 12+ months after initial funding and every quarter thereafter.<h2>Understanding Negative Appreciation: Real Estate Is a Long-Term Investment&nbsp;</h2>When considering rental share prices, it's crucial to understand the high initial costs and longer ramp-up time needed to start generating income, especially for vacation rentals. This often leads to an initial decrease in share price followed by a recovery period as the investment matures. This is because the share price reflects not only the property's value but also its cash balance, which is initially reduced by startup expenses.This initial dip is evident in the Arrived Single Family Residential Fund. The Fund's share price debuted at $10. Following our initial acquisitions in Q1 2024 and necessary adjustments, including fair value revisions and fee adjustments, the share price now stands at $9.97. During Q1 2024, the Arrived Single Family Residential Fund's net returns represented +0.7% for the quarter in combined dividends and share price appreciation. The Arrived Single Family Fund paid $65K in dividends and earned an annualized dividend of 4.0%. The Fund's early-stage operation contributes to a discrepancy between property appreciation and share prices. During this ramp-up stage, funds often operate at a net loss due to expenses outweighing revenue. With a significant portion of newly acquired assets still vacant, property-related expenses outweigh property-related revenue, compounded by fund-related expenses that must be incurred.This imbalance between revenue and expenses is typical for funds in their early stages. As the fund expands and its portfolio grows to support additional property-related expenses, this initial net loss trend is expected to diminish, eventually transitioning into profitability. Read more about the current and future outlook of the Arrived Single Family Residential Fund in our Q1 2024 Summary <a href="https://arrived.com/blog/arrived-single-family-residential-fund-q1-2024" rel="noopener noreferrer" target="_blank">here</a>.&nbsp;<h2>Operational Performance&nbsp;</h2><h3> </h3><h3>Single Family Residential Stabilized Occupancy&nbsp;</h3>Arrived closed Q1 2024 with a stabilized occupancy rate of 92%* for the single family residential properties in operation during the quarter. This was helped by 54 new leases signed in Q1. It’s also worth noting that the average term on these 54 leases was 21 months, and 72% leased above our forecasted rent.<img src="https://lh7-us.googleusercontent.com/9PpYuLvrqe8CziBPgRV5bKhLg1fRk6pUQu4T6HbzUREfTRFVrlR2SytHTqfECy-kqx0JtVzyk7-Ar6rSHQXeFeLmz0aSpeehgBSAPD9bL6sQgC3Op6zdtuvwDsVdJBSgjvzr3IXPz_Fgh2qGilD-6mY">*Stabilized Occupancy includes homes that are occupied or are 90+ days rent-ready from their initial improvements (single family residential properties only). A property may be removed from stabilized if significant impairment outside of the ordinary course of operations requires material action for an extended period.&nbsp;<img src="https://lh7-us.googleusercontent.com/bie4YDH6v2gHbq6uBsgmVbJkBR8CvgUNDL7ZbkTt2oSC_fSKtLPakqNQAOwTvN8oJWUwpx7vcJoX2t0SOrwN8OSbe0EVuAq3_6iTjYWIAYCtIQ7h6nC70RrUY7thXvMF05vhq006DtOalitf0rjj9B0"><h3>Vacation Rental Performance&nbsp;</h3>As of the end of Q1 2024, we have 36 bookable vacation rental properties, 3 of which became bookable during the quarter. Here are some highlights from the quarter for this asset class:<ul><li>$705,777 gross booking revenue across all operational vacation rentals in Q1*</li><li>25 total vacation rental markets as of Q1 2024</li><li>Q1 2024 ended with an average rating of 4.9</li><li>New market: Angelfire, New Mexico&nbsp;&nbsp;</li></ul><img src="https://lh7-us.googleusercontent.com/0lMDDFy5vd3EtZ5YBZEweRf9woy4nptkB7nEhR7fHvNt2zT-U_68NbxyAQflbp4kq19bplkHkiE2hsJ3SjEvihT2xvLh6EBNBRrHNdRSQ-HsmQbxmzWU_RiJ15SrfKgifjDvLjKY-Onp4oAYnjaizLs"><img src="https://lh7-us.googleusercontent.com/jA8VhPg_nKMN5x7OHRZnzf1wihvU7xkQ_Kro9ZDc0U-svhULKnFdUDtLZPhBmh3XS0vw2sjVJ7XKhnpAmZyp9jtEY6G5iDXp9miUVIHueXeTYKOkko0LdY4mp9d2Fp7GP_Gh-nbq2KvkiHcx3vUXNMQ">*Our guest rating is a weighted average for all bookable vacation rentals from the property’s bookable date to the end of Q1 2024.*These figures include only stabilized IPO properties. All figures are unaudited and subject to change.In Q1 2024, 36 vacation rentals were in operation. The gross booking revenue and average guest rating for each rental are below. Gross booking revenue is reported before any deductions for the property management fee, operating expenses, and repairs and maintenance expenses.<img src="https://lh7-us.googleusercontent.com/WLjjoC5lf8V8rPfxVTc0e72zVEO6INsimQaeOGgLJsUZbJmo_kC3AWw3462veXIPfo-55pwI2WJATWhUnMF10szzx1i0nvcu5UX7uA8NdycSgdpYIRAwaUIjNBOFpe8dmqfpFkZZYmPGZoPBj9fk82w"><h3>Arrived Single Family Residential Fund Occupancy</h3>Arrived closed Q1 2024 with a stabilized occupancy rate of 95%* for the single family residential properties in operation in the Arrived Single Family Residential Fund during the quarter. This was helped by 17 new leases signed in Q1. It’s also worth noting that the average term on these 17 leases was 24 months, and 74% leased above our forecasted rent.<h2>Closing Thoughts By Arrived VP of Investments, Cameron Wu</h2>Despite affordability challenges, we're continually impressed by the resilience of the residential real estate market. While sustained higher interest rates and persistent inflation have tempered expectations for rate reductions, home prices remain steady. This underscores the importance of strategic precision and market selectivity. We're focusing on areas with strong macroeconomic tailwinds such as population and job growth, and favorable tax schemes, aligning with our strongest convictions.As we enter the peak season for long-term rentals, our leases are strategically structured to mostly expire between March and June, minimizing lease-up times and maximizing new rents. This positions us well to capitalize on seasonal demand for rentals. Additionally, our vacation rental portfolio is experiencing robust growth, boasting nearly 60% occupancy rates across our portfolio, with 11 properties managed internally by Arrived.Our targeted approach and operational enhancements continue to create valuable opportunities for our investors. Despite challenges in the real estate landscape, we remain optimistic and committed to delivering excellent investments to Arrived.<h2>Watch our Q1 2024 Financials Webinar and Q&amp;A Session&nbsp;</h2>Join us on April 30th at 12:00 PM CST for our upcoming deep dive into Q1 2024 financials. Sign up <a href="https://my.demio.com/ref/fsdjFjNUpMcnN5Ei" rel="noopener noreferrer" target="_blank">here</a>.&nbsp;<img src="https://lh7-us.googleusercontent.com/bna_CnkzPvQejVi1fXtvWWDVsCrxYEImqAlRclNfNsyLtqwH8k__koslIijT9fq7-H_bDOJydkXFcxqWiPtuMrThxyYgvqfrYo1j8hvuzVVz-nSsRps4fP3LyJoTQoHz9FuYmSYXrJfJOsKzlAkxAQo">

Arrived Q1 2024 Financial Performance

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