‘Co-Ownership’ Housing Company Comes to Park City as Residents Express Concerns
A new company called “Pacaso” has come to town and offers a streamlined service to co-own a house in Park City. The company is currently offering two Park City properties on their website. Is home co-ownership really that new a concept or have we just not noticed before?
Second-home owners in Park City are nothing new. Drive through a number of neighborhoods in town and you’re likely to see several that sit vacant for large parts of the year.
Austin Allison is the CEO if Pacaso, a new company that offers a co-ownership model for prospective second-home buyers. Sounds like a new concept, right? In fact, Allison says the practice of co-ownership has actually been happening for a long time.
“This is a concept that’s been happening for decades,” he says. “You know, families decide that they want to own a house in Park City or Napa Valley or Lake Tahoe or wherever the second home destination of their dream might be, and they simply come together and buy the home through an LLC and then share access to the home throughout the year. We are basically co-ownership in a box.”
Pacaso offers a step-by-step process that helps home buyers set up an LLC and manage the property after it has been purchased. The company offers second-home ownership in ⅛ shares and Allison says Pacaso’s research shows that, on average, second-home owners only use their homes a few weeks a year.
“We did a lot of research with second-home owners and we found that most second-home owners use their homes, on average, six weeks a year,” he says.
“Five to six weeks a year depending on where you’re surveying and eight is just really that optimal number, one-eighth rather, is really that optimal number of how much time people actually are able to use their second home in a given year, so we set the model up in that way to really align with the consumer need.”
Pacaso is currently offering two properties on their website, valued at $5 and $15 million each in Park City. Allison says that although the company does have millions of dollars in funding, they plan to be smart with their money and won’t be overpaying for properties in order to price-out normal people in the market for a home.
A recent letter to the editor was penned by a resident near one of the properties expressing concern over having multiple different owners. They said multiple owners could cause problems in the neighborhood and the city should look into regulating Pacaso and other companies like it.
Allison says their fears come from a misunderstanding, both in that their research shows 20% of homes in Park City are already co-owned by LLCs, and that the behaviors of homeowners who have large financial stakes in a property, in many cases, differ from renters when it comes to noise, crowds, and property upkeep.
He says an effort to regulate Pacaso and companies like it would mean taking on home ownership through LLCs, something that, at the moment, is perfectly legal.
“You know, it’s really hard to say that LLCs can’t own homes,” says Allison. “If you get into that business, then what do you do about the 20% of other homes in Park City that are owned in the exact same structure? What’s happening here is not actually new at all, we’re just simply making it easier for people to do with a professionally managed solution like the one that we offer.”
With the local real estate market reaching record levels for both home purchases and home prices during the COVID-19 pandemic, Pacaso’s model is something that could definitely catch on in a place like Park City.