The rise of “fractional real estate” spotlights the overpriced, under-supplied housing market — but will the boom bust?

Bingeing “Selling Sunset”... While scrolling Zillow listings under $100K (spoiler: not many). The median price for a previously owned home sold in April hit a record $391K, up 15% from a year ago. Despite soaring mortgage rates, low housing supply is keeping ownership out of reach for many Americans. Now some startups are offering a way to get in on the housing boom — minus the house.

• You've heard of fractional shares. New-ish thing: fractional real estate. You own a percentage of a property (think: a time-share where you never get to chill).
• Split the bill(ding): Jeff Bezos-backed Arrived just raised $25M to let people buy shares in single-family rentals with “as little as $100.” Startups like Fintor, Fractional, and Pacaso have also popped up to make real estate more accessible through co-ownership.

Cry me a duplex... While still small, the rise of fractional home ownership underscores how many people are priced out. Over the past year, US home prices have risen 20%. But as the Fed raises rates, the situation may be shifting:

• Interest up: The rate on a 30-year mortgage has jumped from 3.7% in February to nearly 5.5%, the highest level since ’09. Some homebuilders may be starting to worry that would-be buyers are sitting out.
• Sales down: Existing-home sales fell for the third straight month in April, with more slowdowns expected. In their earnings forecasts this month, Zillow and Redfin also suggested the market is cooling.
• Still: Pension funds are increasingly investing in real estate investment trusts (REITs) — a vote of confidence in the sector.