- Ember is a startup that allows you to buy as little as a 1/8th share of a turn-key vacation home.
- Co-owners split up time in the vacation home each year, like an updated timeshare.
- Repairs, landscaping, and cleaning are all handled by Ember's management company.
Vacation homes have taken off during the pandemic thanks to the expansion of remote work and availability of cheap mortgages. But just as home prices nationwide have spiked, they've risen even higher in popular vacation spots — 4% higher than non-vacation destinations, according to the National Association of Realtors.
Now a new startup is helping people buy vacation homes — even if they can't afford the entire thing.
Ember, a fractional-ownership firm based in Salt Lake City, Utah, creates an limited-liability corporation, or LLC, for each property in its portfolio and divides ownership for each one into eight parts that can be individually purchased or resold. Ember currently operates 12 homes in 10 vacation destinations from Palm Springs, California, to Galveston, Texas.
Properties currently available on the Ember site begin at around $190,000 a share. Anyone who buys a 1/8 share is guaranteed 45 nights a year and one holiday weekend. Individuals and families can buy up to a 1/2 share of a property, which increases their allotted time to 180 nights a year.
The buy-in price of $190,000 is much cheaper than the median home price in the US in 2021, which was $361,700, according to National Association of Realtors.
On Thursday, the company announced a $17.4 million round of Series A funding led by billionaire tech investor Peter Thiel. Appetite for second homes has only increased as pandemic restrictions have eased. In a survey of homebuyers completed by real estate consultants Knight Frank, 13% of respondents said a second home will be their next purchase. Ember faces fierce competition in the house-splitting space, most notably from Pacaso, the fastest American startup to reach a $1 billion valuation.
Ember CEO and cofounder Kurt Avarell told Insider part of the inspiration for the company came from a houseboat his family shares with seven other families on Lake Powell in Utah. Maintenance, repairs, and scheduling are all handled by a management company. He said his family shows up for vacation and walks away without any of the hassle of full-time ownership.
"It's amazing that this exists on water. Why doesn't it exist on land?" Avarell said.
Ember currently buys or builds properties in what it calls "super pockets" — destinations that are "outdoor playgrounds" within a two or three hours' drive of metropolitan areas. Take the Wisconsin Dells outside of Milwaukee, or Bend, Oregon, outside of Portland. The company targets locations that are far enough to be a getaway, but close enough to warrant multiple visits a year.
"Anywhere that America goes to vacation is really a potential market for us," said Jeff Lyman, Ember's chief experience officer.
Co-owners book time at their properties through an app that has a calendar with available dates and way to communicate with an Ember concierge. The company outfits its homes with storage for owners not currently occupying the house to stow their golf clubs or mountain bikes. Maintenance, landscaping, and cleaning is all handled through local contractors employed by Ember.
The goal is to make a vacation home that Avarell calls "totally turn-key" for owners.
Chris Baird of Kaysville, Utah, had been looking for a second home near Zion National Park in St. George, Utah in the early days of the pandemic. After nine months of searching, the married dad of four became deflated after being constantly outbid in a hyper-competitive market.
"To get the property we really wanted would have overextended us," he told Insider.
In October 2021, Baird, who discovered Ember via social media, purchased a share in a seven-bedroom house in nearby Coral Canyon, Utah, that has a pool and golf course access. He and his family have already visited four times.
"To be able to spend one-on-one time with my kids has been incredibly awesome," Baird said.
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