Mike Schneider of Acre Homes: The Generational Housing Question, the Broken Affordability Math, and Shared Ownership

The affordability math from the 1970s, 80s, and 90s is broken. Mike Schneider, founder of Acre Homes and longtime real estate operator, joins The Ryan Vet Show to walk through what actually happened to home ownership in America, and what comes next.

Mike Schneider has spent the last decade and a half rebuilding the math of home ownership. He co-founded First in 2012, using machine learning and AI to predict who would sell their home, and sold that company. He is now the founder of Acre Homes, a shared appreciation model that lets people own without taking on a $670,000 mortgage. In this conversation with host Ryan Vet, two Durham millennials walk through how home ownership got this expensive, why blaming Wall Street is missing the real story, and what a generation of would-be buyers actually needs.

The episode opens with the conversation that started this episode: Ryan spotted Mike walking down a Durham street wearing wired headphones. Two millennials, both Durham-based, both quietly recalibrating away from the trendy and back to the durable. That instinct, going analog, is showing up in housing too. Mike unpacks the three primary drivers of the affordability crisis (broken income-to-price math, delayed household formation, the disappearing starter home), the data on which generations are actually buying houses (Gen Z is outpacing millennials at age 28), and why the 50 or 60 year mortgage is a political move that does not solve the underlying problem.

Then Mike walks through the shared ownership model. In the United Kingdom, Zillow's equivalent lets you filter for sale, for rent, or shared ownership. In the United States, that third option does not exist. Acre Homes is building it. Five percent down for fifty percent of the appreciation. No transaction costs on the front end. Lower total cost of ownership through what Mike calls the "Costco effect" of bundling debt, insurance, and operations across thousands of homes. Mike explains why two-thirds of Acre's customers are not first-time buyers (as expected) but previous homeowners who have lived the pain of buying and selling under the current model.

The conversation closes on the data Mike thinks gets buried under the doom headlines. American home ownership is at 65 to 66 percent, higher than the 1980s. Eighty-three percent of Americans still prefer to own rather than rent (Lending Tree, October 2024). The country is between 1.5 and 5 million homes short on inventory. The American Dream is not dead. The math just needs new models.