US startup Rhove partnered with its first property owner this quarter, in Ohio, to offer renters a financial stake in the building they’re living in. Rhove aims to help young adults build wealth, even as they pay large portions of their income to landlords, and receive some of the monetary benefits of ownership. When renters join a Rhove partner’s building, they can claim a USD 50 share in the property. Every year they live in the building yields another USD 50 share. Renters can also purchase fractional shares (starting at USD 5) throughout their time on the property, and will earn 5% returns on their investment (paid out by the owner). As the value of the building increases, the shares’ value increases, with residents earning a portion of the proceeds if their building is sold.
This concept isn’t brand new. Rhove reminds us of a similar scheme from 2018, designed to help young adults floundering due to Hong Kong’s housing crisis — the OPods were 9.29-square-meter homes made from concrete water pipes, and young adults could receive some of their rent money back upon moving out (to help them save up for a larger home). Although we’d venture to say Rhove’s setup is more appealing than living in a concrete tube!
But both the Rhove and OPod strategies take on new relevance today, as COVID-prompted unemployment places an especially large toll on younger consumers in the “lockdown generation.” At least 1 in 6 young adults globally stopped working since the pandemic emerged and those still working have had their hours slashed by around 23%. And those Gen Z-ers who haven’t begun working yet, whose next life stages have kicked off with Zoom or Minecraft graduation ceremonies, know they face an uncertain future.
The focus on helping young people reach difficult-to-attain “adult” milestones (saving up for a home, investing, etc.) existed pre-pandemic and is perhaps an even more urgent opportunity today. What could your brand deploy not only to help younger consumers hit those benchmarks of adulthood, but also do so during times of unprecedented change?
Stay healthy,
The TrendWatching content team
