One Las Vegas developer is getting creative to attract potential residents to its apartments: cash to eventually leave.
Cherry Development introduced its Path to Homeownership program for residents at its two shareDowntown apartment complexes, totaling some 150 units. Those who opt in can have Cherry put $200 of their monthly rent in an account that can later be used to help buy a home.
Jason LeDell, Cherry's managing partner, told CoStar News that residents can build up to $4,800. The program is designed to last two years, but a resident who needs more time to get ready for homeownership can extend their participation. The accrual, however, is capped after 24 monthly rent payments.
LeDell called the idea a "triple win" for the company, its renters and Las Vegas at large. While the program is designed to create turnover in its apartments, his firm can quickly find tenants to backfill units.
"They're going to tell their friends, their family and anybody else that they were able to obtain homeownership, which is going to gather more people for our residences," LeDell said.
The funds, which can be accessed as soon as 12 months after opting in, must go toward buying a home in the Las Vegas and Clark County area. Should a resident relocate and purchase a home outside of the area, that money goes back to Cherry.
"Residents won't be losing anything. This is money that they're already paying for rent," LeDell said. "If they decide that they have to go and move out of state, well, they didn't lose anything."
A few residents have already opted into the program, per LeDell, but it's too soon to say if it will translate into the purchase of homes.
A priority amid market appreciation
Cherry partnered with financial institutions, mortgage lenders, title companies and credit improvement specialists to provide discounted services along with educational guidance to help residents get ready for homeownership.
The offer is available to current and future residents at Cherry's two shareDowntown apartment complexes, in the Arts District and the Fremont East area. Cherry plans to open another project, called shareWestside, in the coming months and add over 100 new apartment units to the Historic Westside neighborhood.
Financial paths for a renter to become a homeowner are more commonly directed by local and state government agencies than by a private builder, LeDell said.
In Phoenix, national homebuilder Taylor Morrison rolled out a cash incentive last year for residents of its built-to-rent brand Yardly, up to $5,000 in discounts on a new home built by Taylor Morrison that they can own outright.