The Passive Income MD Podcast #280 Home Equity Agreements: A Different Way to Invest in Real Estate
Sep 8, 2025
Jesse Stein, Chief Investment Officer at HomeShares and a seasoned expert in real estate securities, joins the conversation to unravel the world of home equity agreements. Discover how these innovative agreements allow homeowners to access liquidity without selling their properties. Jesse elaborates on the blend of downside protection and strong returns they offer investors, even in fluctuating markets. Explore the future of real estate investing and the potential for portfolio diversification as you unlock hidden value in home equity!
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Founder Background Shapes Strategy
- Jesse traces his path from equities trader to building niche real estate products and platforms before joining HomeShares.
- His background includes starting firms, partnering with E-Trade and NASDAQ, and leading real-estate investing platforms.
Home Equity Agreements Explained
- Home equity agreements give homeowners upfront cash in exchange for a share of future home value without adding debt.
- These contracts are typically 10 years with repayment on sale or refinance, letting homeowners access illiquid equity.
Overcollateralization Creates Downside Protection
- HomeShares structures deals with an exchange rate that overcollateralizes their position to boost returns and protect capital.
- That structure provides downside protection similar to debt while preserving upside like equity.