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Vessel Tutorial
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Vessel Tutorial

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Introduction to Vessel

⁠
Vessel
⁠
is a "home equity exchange" that lets owners of residential properties sell "shares" of the value of their properties to investors, who get
income
⁠
and
appreciation
⁠
in return.

For property owners, Vessel is an
alternative
⁠
to getting a
home equity loan
⁠
or
selling their property
⁠
. For people with money to invest, it is an
alternative
⁠
to
buying rental properties
⁠
or
investing in REITs
⁠
.
The following are the key components of how Vessel investments work:
1.
Appreciation & Equity Sharing
⁠
⁠
2.
Interim Home Value
⁠
⁠
2.
Yield & Income Payments
⁠
⁠
3.
Conversion of Income to Equity
⁠
⁠
4.
Home Value Estimation
⁠
⁠
These concepts are all brought together through our
financial model
⁠
.
Other components worth understanding:
5.
Legal structure of Vessel investments
⁠
⁠
6.
Owner-cased value increase or reduction
⁠
⁠
7.
Maximum contract length & hold period
⁠
⁠
8.
Recourse in case of owner noncompliance
⁠
⁠
9.
Reselling investment stakes
⁠
⁠
10.
Vessel's fees
⁠
⁠
A simple example (click the arrow next to “View Example” below) and the
flexible financial model
⁠
demonstrate how the math of this program works in practice. You may
schedule a demo
⁠
to go over the financial model and discuss this entire program.
First Topic:
Equity Sharing
⁠
⁠

View Example

To offer a rough idea of how these investments work, see the example below, which shows results in different scenarios. As can be seen, as the property value (appreciation) increases, the annual payments and proceeds to investors from sale increase as well.

Assumptions

⁠
Initial Property Value
⁠
$
1000000
⁠
($1m)
⁠
Investment
⁠
: $
100000
⁠
($100k)
⁠
Yield
⁠
:
5
⁠
%
⁠
Percent of Income Owed Paid With Cash
⁠
:
100
⁠
%
⁠
Year of Property Sale
⁠
:
10
⁠
⁠
Results
Scenario
Property Sale Price
Avg. Annual Payments
Investor Proceeds From Sale
Total Cash Returned
IRR (%)
1
Depreciation (-2%/year)
$817,073
$4,529
$81,707
$131,524
3%
2
No Home Value Change
$1,000,000
$5,000
$100,000
$150,000
5%
3
Appreciation (+5%/year)
$1,628,895
$6,458
$162,889
$233,923
10%
There are no rows in this table
3
Count
⁠


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