In this article:
- PadSplit Hosts do well while doing good. But what does that really mean? Learn how PadSplits benefit their communities and provide an effective fix for the affordable housing gap.
- As a Public Benefit Corporation, PadSplit serves the workforce. The platform’s innovative technology makes this both possible and profitable.
- The pandemic disrupted the housing sector, raising rents for traditional apartments to unsustainable levels. PadSplit gives workers a quality place to live within their communities, as well as the opportunity for financial uplift.
- PadSplit has already saved taxpayers hundreds of millions of dollars. It’s an immediate and efficient way to boost the affordable housing supply without relying on public subsidies.
The affordable housing shortage in the United States has long seemed like an impossible problem. Millions of hard-working individuals urgently need homes, but every fix requires too much time and public spending.
Is there a role for real-estate investors to play to help the growing number of Americans who can’t afford a place to live?
Fortunately, PadSplit offers an expedient solution. Its innovative technology platform makes it easy for investors to gain value from unused spaces in larger homes by converting them into safe and accessible single-person occupancies.
According to PadSplit’s Founder and CEO Atticus LeBlanc, the company’s philosophy is that “we can make affordable housing possible by also making it profitable.” Essentially, PadSplit allows investors and property owners to do well while doing good.
The doing well part is all in the numbers, with PadSplit Hosts seeing an average 2X increase in returns across the board. But what about doing good? As Atticus explains in an episode of The Millionacres Podcast, it goes beyond simply providing affordable housing.
PadSplit is a mission-driven Public Benefit Corporation aimed at creating “a legacy for positive change in the world.” PadSplit owners, or Hosts, get to be part of that mission by helping to address some of the most difficult problems our society faces today, like systemic inequality and support for essential workers.
Read on to learn more about what it really means when we say PadSplit owners are doing good.
PadSplit reduces barriers to access for an underserved audience
As part of PadSplit’s charter as a Public Benefit Corporation, it is required to provide housing for people earning below 80% of the area median income.
This makes PadSplit the only co-living organization serving the workforce. But PadSplit isn’t a charity; it’s a for-profit company. In fact, its target audience is much larger than that of other co-living platforms.
To capture that potential, Atticus had to get creative and utilize new technologies and processes to support underserved individuals.
One innovative strategy is to include all living costs in a single membership payment, with billing cycles tied directly to residents’ pay periods. “If every fee you can think of is baked into that same payment, it is much more likely to be made on a consistent basis,” said Atticus.
The result is that owners can serve the workforce without worrying about chasing down multiple payments, securing their revenue streams.
PadSplit provides financial uplift for essential workers
The pandemic has disrupted society in ways that nobody could have predicted. But Atticus says that when he founded PadSplit in 2017, he “had some event like this very much in mind” and wanted the company to be “prepared for the next downturn.”
In fact, COVID made PadSplit’s services more necessary than ever. “We recovered much more quickly than most housing sectors and have consistently outperformed the apartment industry,” said Atticus.
The average income of PadSplit Members is around $25,000 a year, and that includes many of the essential workers who were on the front line during the pandemic, like grocery store employees, retail and administrative staff, and EMTs.
As home prices and rents skyrocket, Atticus has seen demand for PadSplits increase, since “the reality is, these folks just don’t have any other options.”
Beyond providing a safe place to live, one of PadSplit’s goals is to address the systemic housing inequality that the pandemic has laid bare. Atticus points out that zoning policies disproportionally affect minority populations and that his organization “strives for economic uplift” for its Members.
PadSplit gives residents “the opportunity and access to find stable housing that creates savings, that can eventually build income and wealth.”
In fact, Atticus has even seen a virtuous cycle unfolding among some PadSplitters: people begin as PadSplit Members, build credit and save money, and eventually buy their own homes and rent rooms on the platform to help cover their mortgage payments.
“We love to hear it and love to see it, and I think it’s certainly possible in just about any jurisdiction,” Atticus says.
PadSplit is an efficient fix that saves taxpayers money
Atticus believes that “the workers who serve our communities also deserve the opportunity to live in them.” However, the supply gap is currently around 12 million units nationwide.
One of the most successful government programs to address this problem has been the low-income housing tax credit, which has created 3 million units over the last 30 years. But at this rate, it would take 120 years to fully close the gap. By comparison, PadSplit offers a fast and efficient solution.
Not only that, the average cost to create a one-bedroom apartment is more than $200,000 in taxpayer-funded public subsidies. Meanwhile, PadSplit has created over 4,000 units with no public funding whatsoever. That amounts to taxpayer savings of more than a billion dollars, not counting any additional ongoing subsidies that may be required.
PadSplit creates affordable housing for workers who often have no better options while letting investors make a real difference in their communities. The benefits are tangible, both in terms of increased returns and in helping to address one of the most difficult problems our society faces today.
“Our goal is to create a world-class marketplace that is literally solving the affordable housing crisis one room at a time, and to be able to create access to economic opportunity for people in need who have historically never had that access,” said Atticus.
Ready to join the mission and start doing well while doing good? Contact our Host Specialists who can walk you through the entire process and provide important guidance for adapting your property to become a PadSplit. The sooner you get started, the sooner you’ll be able to start making a real difference in your community.
This article is based on PadSplit CEO Atticus LeBlanc’s interview on The Millionacres Podcast. Check out the full episode to learn even more about how PadSplit benefits communities through shared housing opportunities.
Want to learn more about managing a PadSplit? Visit our Help Center for everything a Host needs to know about PadSplit onboarding, listing, and operating procedures.