Divvy Homes
Divvy bought homes for renters and let them build equity toward buying within three years. When prices dropped below purchase price, tenants walked away. Rent-to-own transfers timing risk from buyer to company, and the company held the bag.
Home ownership increasingly requires something most first-time buyers lack. A down payment, the median home crossed 400,000 and 20% down means 80,000 in savings. Divi homes proposed a workaround. Buy the home for you and rent it back while you build equity toward ownership. The model worked like a modernized lease to own. Divi purchased homes tenant selected, charged rent including a savings component, and gave the option to buy within three years at a pre-agreed price. By 2021, over 600 million raised, valued at over 2 billion, operating in 16 Sunbelt markets. When prices surged during the pandemic, Divi's homes appreciated faster than expected.
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