Vacation Rental Real Estate Investment Trusts (REITs)

Many investors aspire to own a holiday rental home. After all, it combines a vacation and a way to earn money. Unfortunately, a few drawbacks of owning a short-term rental property keep many investors from achieving their goals. Two of the most significant are the costs of acquiring a property and the hassles of dealing with short-term renters.

The Issues with Buying Rental Properties

The stock market (SPY) has grown exceedingly volatile, and many people are now calling it a bubble. With this in mind, it's not surprising that an increasing number of investors are deciding to own a rental property. Here are some of the common reasons why:

● High Income: Most rentals provide an annual revenue of between 5% and 10%.

● Low Volatility: Stocks are notoriously volatile, especially in light of the current global crisis. Rental properties are far more resilient. Their worth does not alter much from one day to the next.

● Inflation Protection: Many investors worry about inflation escalating as a result of the central bank's rampant printing. Due to the fact that housing is a necessity that cannot be replaced, rental properties are among the best inflation hedges.

● Peace of Mind and Control: You have complete control over your money and make your own decisions. You do not have to rely on potentially conflicted management staff.

At first glance, rental properties can appear to be desirable investments, especially in today's increasingly unstable economy. There are, however, a few substantial disadvantages to investing in rental houses including:

1. Potential illiquidity: Real estate is not a liquid asset, and even in the hottest market, closing a sale might take several months. And if your time is limited due to an emergency or other unforeseeable event, your desire to sell quickly may not result in the best price.
   

2. Taxes and insurance premiums are increasing: Although the principal and interest on your mortgage may be fixed, there is no assurance that taxes won't rise more quickly than your ability to raise rents. The cost of insurance could increase, as it does in the aftermath of natural disasters.
   

3. Problematic tenants: Despite your best efforts to thoroughly research potential tenants, you can end yourself with less-than-ideal tenants. They might, for instance, be needy or demanding, make late payments, fail to turn off the water, and so forth.
   
   Furthermore, they may be destructive, in which case the tax code's depreciation limit may be woefully inadequate.

Professional Management Is More Important Than Ever

The management of a rental property has always been its biggest drawback. Among other things, you have to deal with tenants, toilets, and trash. The importance of having a qualified management team is rising in light of this.

After making your REIT investments, you can put it out of your mind, relax, and take advantage of the dividends. Needless to say, you won't have to deal with late-night calls about clogged toilets or arguments with renters about unpaid rent.

REITs attract the best real estate professionals, and management is very efficient due to economies of scale. REIT management teams collected more rent than private landlords during the COVID-19 crisis.

Interest rates are rising, but no one knows how much higher they will go. This is poor news for first-time or would-be homeowners, but good news for income-generating properties like office spaces, apartments, and warehouses.

Wander REITs may be your best option if you're seeking the greatest approach to begin investing in real estate under the direction of a top-notch investment team. Wander REIT is the first and only institutional-grade vacation rental investment product that allows clients to own their own properties. Join forces with Wander to create the travel experience of the future.

What is Wander?

Think of Wander as a travel company that combines the comfort and privacy of a vacation home with the quality of a high-end hotel. You can have it both ways, as unbelievable as that may sound. Wander provides consistent attention to detail, large open spaces, and privacy.

Wander launched their luxury vacation rentals in February 2022 and has had 3,600+ nights booked with a 90+% customer satisfaction score. In comparison, Airbnb's average is roughly 55%.

Wander now provides smart homes in exciting locales throughout the United States, from Southern Oregon to Joshua Tree, and Hudson Valley to Surfside Beach, with new locations opening every month.

The Team Behind Wander

Wander's CEO is John Entwistle. His first venture as an entrepreneur was Coder, a platform that moved software development to the cloud. After their open-source software was downloaded over 6 million times, John and his co-founders were named to Forbes' 30 under 30 lists.

The remaining members of the 50-person team are property managers, interior designers, and real estate professionals. The team's Head of Capital Markets is Jake Kelley (formerly Morgan Stanley Real Estate).

How Wander Operates

Wander takes care of everything. This hands-on approach allows them to provide the best possible experience for their customers. Here’s a quick rundown of how they operate:

● Smart and compelling acquisitions: The locations of Wander's properties must be distinctive and in high demand. On the fringes of a breathtaking lake or in the center of a forest.

● Superior design: The designers begin their work after the property has been secured. Modern furnishings, opulent extras (having as many showers as feasible is a recurring theme), and an abundance of innovative products.

● Easy booking: The Wander website or mobile app is used to manage all reservations. Customers can split their reservations straight in the app, which is a terrific feature. Therefore, there is no need to struggle with splitting the money in 11 ways.

● World-Class Property Management: Each property at Wander has a specialized team to keep it in peak condition.

● You get a Tesla: High-end hotels frequently provide their visitors with a Tesla to use for transportation. Wander has noticed and is currently acting similarly. Each and every vacation property has a Tesla tucked away in the garage!

Wander will scale far more slowly than Airbnb since it is a lot more resource-intensive enterprise. Airbnb outsources its hosts and properties to anyone who can be bothered. However, it also implies that the holiday experience is vastly different.

Wander is a short-term rental company that recently announced a $100 million loan structure from Credit Suisse in order to expedite the acquisition of additional residences for its portfolio. Their goal is to have a Wander property within three hours of 80% of the United States population.

This news follows the launch of their new investment arm, a captive REIT. Atlas, a real estate investment trust, drew millions of dollars in investment interest within 48 hours of its initial public offering.

When properties in the Wander short-term rental inventory are ready for paying guests, they are transferred to Atlas. The approach includes an agreement that Wander has the right to run and maintain the properties even if they are under the Atlas umbrella, with revenues dispersed to investors monthly or if a property is sold.

Wander's mission is to efficiently create a superior guest experience by vertically integrating the fragmented $100B+ vacation rental sector. With the Wander REIT, investors can own a piece of travel's underlying infrastructure while benefiting from everything put on top of it - a first-rate visitor experience paired with a cutting-edge technological platform.

REITs are tax-exempt investment vehicles that invest in one or more real estate properties or related assets such as mortgages. REITs are obligated to pay out at least 90% of their net income in dividends to shareholders.

REITs often invest in a certain type of real estate asset, such as apartments, office buildings, or hotels. As far as we know, Wander REIT is the first and only vacation rental REIT.

Because of the Wander REIT's special status, there is no corporate-level taxation to the extent the REIT distributes 100% of taxable income. A significant benefit provided to non-corporate REIT investors is a 20% tax deduction on some REIT distributions.

The Benefits of Investing with Wander

● Wander is the owner and operator: We choose properties in the most beautiful locations, buy them, improve them, and maintain them to the greatest standards so you can have the nicest vacation ever.

● They choose the most inspiring locations: We hand-pick each breathtaking site and put our hearts into making it as magical as we can because we own every home on our platform.

● 24/7 Wander Concierge services: Their text-based Concierge service is available 24/7/365 to assist you with everything from restaurant reservations to activity reservations.

● Pricing that is clear: There are no hidden fees or cleaning expenses. Everything from super-fast WiFi to a private gym is included in a single nightly cost that you can easily divide with friends.

● Unrivaled customization: The Wander app is your magical key for the duration of your stay. Total home control is at your fingertips, from unlocking the door to adjusting the warmth of the fireplace.

● Amenities to enhance your visit: Wander makes your stay comfortable with luxury brand collaborations, including a Tesla in the garage, a gym and sauna, and refreshments in the refrigerator.

Why Invest in Vacation Rental REITs?

Vacation rental real estate investment trusts (REITs) have grown in favor among investors looking for income-generating assets in recent years. REITs are companies that own and run income-producing properties, such as holiday rental properties. REITs invest in properties that are rented to tourists.

Here are some of the benefits of investing in vacation rental REITs:

● Diversification: Investing in vacation rental REITs diversifies an investor's portfolio by exposing them to a different sort of asset than standard stocks or bonds. Furthermore, these REITs invest in a diverse portfolio of vacation rental properties in several places, which can minimize risk and boost returns.

In general, there is little correlation between equity markets and REITs. As the first and only vacation rental REIT, it is one of the few ways to gain exposure to a growing asset class with minimal correlation to public equities.

The Wander REIT allows investors to diversify away from standard equities and bonds by investing in a portfolio of high-quality vacation homes. Wander REIT's revenue and value are ultimately derived from rental income and property appreciation, both of which tend to rise during inflationary periods (such as the one we're currently experiencing).

● High Yield: Vacation rental REITs can offer a high dividend yield, making them an appealing option for income investors. These REITs often return a considerable amount of their rental income to owners, resulting in a consistent and predictable stream of income.

● Passive Income: Investing in vacation rental REITs provides passive income because investors do not have to actively maintain the properties. An easy and hassle-free investment choice, Wander REIT's management team manages all property management, maintenance, and repairs.

The Wander REIT delivers the advantages of vacation rental investing without any of the hassles. That means no more organizing reservations, changing light bulbs, or cleaning up after guests. Investing with Wander means you have the potential to receive payouts every three months straight to your bank account.

● Growth potential: Vacation rental REITs offer substantial growth potential due to the expansion of vacation rentals and short-term rentals. As more people choose vacation rentals over hotels, the demand for holiday rental properties is likely to rise, potentially leading to better rental income and capital appreciation for investors.

The total return on investment is computed by adding the dividends paid plus any appreciation (or subtracting any decline) for the time the Wander REIT stock is owned. The Wander REIT seeks to give investors an annual return of 8%.

● Lower Barrier to Entry: Purchasing a vacation rental home requires a substantial investment. Investing in vacation rental REITs, on the other hand, can be done with less money.

Individual investors can now obtain access to the holiday rental sector more easily. In fact, you can start investing in Wander REITs with just $2,500!

With their high yield, diversification, passive income, growth potential, and low entry barriers, vacation rental REITs can provide investors with a unique and appealing investment opportunity.

However, like any investment, it is important to conduct proper due diligence and assess the risks before investing. Contact Wander to experience REIT investments on a whole new level.

How the Wander REIT Operates

Investors can visit the Wander REIT page, open an account, and get pre-approved for investing. The funds received from investors are utilized to purchase new properties for the REIT.

Wander REIT will distribute at least 90% of the income generated by its five properties (and counting). Quarterly distributions are placed into each investor's bank account. Meanwhile, third parties are responsible for revising the REIT's NAV on a regular basis in order to establish its share price.

Wander REIT maintains the right to sell any of its assets at any moment. Profits might be reinvested or paid to shareholders.

Returns on Investment

Wander REIT provides accredited investors with the ability to earn an annual dividend of 8% and an annual return of 14%. This equates to a 2% annual increase in equity over a seven-year period.

Of course, yield is everything with holiday rentals. Wander is aiming for an annual dividend yield of 8%. Rental revenue and property price appreciation contribute to the total predicted return of 14%.

Based on a number of variables, Wander pays Wander REIT a monthly rental on the properties, and Atlas distributes the bulk of this revenue to investors as the anticipated 8% annual dividend. In case you were wondering, this yield is roughly twice that of public REITs.

Questions to Consider

​​What is a REIT?

Companies that own or finance real estate that generates an income are known as REITs or real estate investment trusts. To be eligible as REITs, these real estate firms must fulfill a number of conditions, including generating at least 95% of their revenue from rent, mortgage interest, or other passive sources, and paying out 90% of that revenue to shareholders.

The Wander Atlas REIT is set up as a REIT because we believe it to be the most reliable and well-known way to give investors real estate returns.

Do I have to have accredited investor status? What exactly is a qualified investor?

Yes, as of right now, only "accredited investors" are allowed to make investments in the Wander Atlas REIT. Individuals or organizations designated by the SEC as qualified to invest in sophisticated or complicated securities are known as accredited investors.

Specific requirements must be completed in order for someone to be accredited, such as having a total net worth of over $1,000,000 or an average monthly income of over $200,000. The Wander Atlas REIT onboarding procedure includes a verification of each investor's status as an accredited investor.

Get In Touch With Wander Today

If you want to invest in a vacation rental home, this could be an excellent choice because you can start small. Wander has a proven track record of offering attractive real estate deals to its marketplace, making their team worth looking into further.

Get in touch with Wander today!