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Austin Allison, CEO of the second-home ownership platform Pacaso, believes co-ownership can pose a solution to the housing crisis gripping second-home destinations amid the pandemic housing market.
On a virtual Inman Connect session sponsored by power buyer Knock, Allison told Knock CEO Sean Black he believes the co-owning model can help alleviate the pressure on mid-tier housing that’s currently pricing year-round residents out of homeownership in vacation destinations.
Pacaso’s model of co-ownership allows groups of customers to own shares of a house. This allows buyers to upgrade their purchase by going in on a share of a luxury home for the same amount of money that could have been used to become the sole owner of a less opulent home. This makes more mid-tier homes available to year-round residents, Allison said.
“What co-ownership does is it consolidates demand away from the median tier and it moves it into the luxury tier, thus relieving pressure at the median tier and making it possible for locals to afford primary homes,” he said.
Co-owning could also prevent vacation homes from sitting empty — which most of them do for all but a few weeks out of the year, he pointed out.
“Every empty second home means another needs to be built to absorb demand,” Allison said. “Which creates a larger carbon footprint and it starves local businesses during the shoulder season because owners aren’t even in the home supporting the local businesses for all those months.”
Allison predicts the co-ownership model will become more prevalent, especially as remote work becomes more long-term for certain workers and some families embrace a nomadic lifestyle.
“I do think we’ll see fully nomadic families emerge where instead of buying one home in San Francisco, imagine if you could buy a quarter of a home in San Francisco and a quarter of a home in three other locations and spend your time in three other locations throughout the year,” he said. “I definitely think that’s going to be part of the future.”
The model brings benefits for agents as well, he pointed out, as Pacaso partners with agents for the purchase and sale of Pacaso homes, while managing the co-ownership process, so agents make their commission without any additional headaches, and find added business instead of competition from a new model.
“It’s icing on the cake,” Allison said. “You get a full commission and we do all the heavy lifting.”
Black’s appearance at the virtual event came two days after Knock announced it would be laying off 46 percent of its staff and stepping away from its plans for an Initial Public Offering.