OwnHome, an Australian Proptech seeking to help turn renters into homeowners, has raised $3.6 million from investors including Global Founders Capital, Entrée Capital, AfterWork, and InVentures. OwnHome had previously secured seed funding from the Commonwealth Bank’s x15 Xccelerate program.
The company notes that skyrocketing property prices are making it more and more difficult for renters to become homeowners. This Australian rent-to-own scheme has been designed by two millennials to help customers own homes in three months.
Co-founded by Tim Harley, who led the expansion of Wise (TransferWise) into the Middle East, and James Bowe, the duo is motivated by their generation’s struggle to afford a first home.
In brief, OwnHome buys a property for the customer enabling the customer to immediately move into the home straight while making monthly payments to OwnHome. OwnHome allows high credit customers without a deposit, to build purchase credits while they live in their home. The monthly amount is said to be equivalent to the traditional method of renting and saving for a deposit for that same home, but gain two benefits: they move into their home immediately and they benefit from capital gains of the property. Within the first three to seven years, the customer should be able to buy the property off OwnHome at a pre-agreed price.
OwnHome say that demand has been strong with a growing number of aspiring homeowners already on the waitlist.
Co-founder James Bowe says aspiring homeowners are facing soaring property prices:
“It takes up to a decade longer to save a deposit than it did 50 years ago and more and more homebuyers, if they have the option, are relying on the bank of Mum and Dad to get onto the property ladder. OwnHome is the only rent-to-own model that provides a path to home ownership in the area you want to live in that doesn’t require hundreds of thousands of dollars for a deposit.”
Avi Eyal, an investor in OwnHome and the Managing Director for Entrée Capital, says the rent-to-own business model is taking off in the US, and OwnHome is bringing a much-needed solution to Australia.
“We believe James and Tim have the vision, experience, and drive to deliver this new path to homeownership for Australians. Residential housing represents the world’s largest asset class at $160T – the size of the opportunity for OwnHome is enormous. Australia stands out as a country with one of the most acute homeownership issues globally, and OwnHome is forging a new way for hard-working Australians to realise their dream of homeownership.”
OwnHome is available in Sydney, with a plan to expand services to other capital cities in the near future.