Renting often feels like a necessary evil, one which is compounded by the fact that renters are unable to build equity – through no fault of their own. A company called Viva thinks they have a solution for this systemic issue: third-party equity.
Viva is a startup with the main goal of allowing renters to earn a certain amount of equity per month.
The process itself is fairly straightforward: Renters in Viva-managed properties have the opportunity to earn up to eight percent of their rent back in equity per month. This equity is stored in the form of a rebate that can be reclaimed once the renter’s lease is up.
I say “up to” eight percent because, according to Viva, certain tasks–mild, “unskilled” maintenance and general upkeep of the property–are assumed to be the renter’s responsibility (unless otherwise dictated elsewhere); failure to maintain a presentable property can result in a lower percentage of rent going to your equity.
While that sounds like it opens the door for picky landlords to dock renters for arbitrary issues, Viva assures them that they “expect the vast majority of all tenants to earn the full 8% every month.”
That equity can be tracked via Viva’s online portal and payment receipts from each month of rent.
Once a renter’s lease expires, they can request their equity in the form of a rebate; it can also come in the form of a housing credit should the renter want to put it toward their next property.
On the landlord side, Viva charges a relatively high 16 percent for management: eight percent for renter equity, and eight percent for general management fees.
While this sum is higher than the average 10 percent cited on Viva’s FAQ, they point out that their eight percent covers more things (maintenance and “community engagement”) than a usual maintenance fee.
Viva also posits that people who live in properties they manage will be more dedicated to maintaining those properties, thus cutting down on long-term costs.
Viva’s goal of creating a third viable option that nestles between renting and buying couldn’t come at a better time in terms of the housing market. Both renters and landlords will want to keep an eye on this venture as they develop.
This story first ran here in October 2021.
