- The startup aims to help buyers overcome the deposit hurdle
- CBA's entity x15ventures has become a a minority investor
- Over 3,500 applicants have already joined the waitlist
Commonwealth Bank of Australia (CBA) has backed the startup OwnHome who say they are building a new path to ownership by helping prospective buyers overcome the deposit hurdle.
Through its venture-scaling entity x15ventures, CBA has contributed a minority investment to OwnHome’s fundraising round which was raised $31 million in total.
OwnHome, Co-founded by James Bowe and Tim Harley, was the winner of the Xccelerate2020 event which along with mentorship, secured them $150,000 in funding.
“Xccelerate2020 helped set us up for success in the early days of OwnHome, providing us with the funds and expertise to take us from a small team to a growing alternative for those eager to secure their path to homeownership today,” Mr Bowe said.
How does OwnHome work?
With the average house deposit reported to have reached over $100,000 mid last year, saving for a house deposit is becoming increasingly out of reach for many Australians.
The rent-to-own model allows aspiring buyers who may not have the savings for a deposit but can afford regular mortgage repayments to act as a homeowner in their homes. They simply pay an upfront fee before moving in and make monthly payments which contribute to their deposit over time.
After three to seven years of living in their home, the tenants can choose to buy it at a predetermined price, putting their accrued deposit towards the purchase.
Managing Director of x15 Toby Norton-Smith, acknowledged that housing affordability is a challenge for many Australians, particularly young people and their families.
“We believe OwnHome will provide an alternative path to home ownership, particularly for first home buyers who are responsible savers but aren’t able to rely on the bank of mum and dad for help with the deposit.”
Toby Norton-Smith, Managing Director of x15
“This is a particularly satisfying investment to make, given we’ve worked with the OwnHome team since they first founded and launched with the support of our Xccelerate program, and because our strategic VC partner SquarePeg is leading the round,” Mr Norton-Smith said.
What does the future hold for OwnHome?
Over 3,500 applicants have already joined OwnHome’s waitlist. The firm intends on purchasing 200 homes for approved customers over the coming two years.
“In just over a year, we’ve continued to grow our team and customer base, partnered with :Different, and have recently expanded into the Queensland property market.”
“As we scale and shape the model in Australia we will continue to benefit significantly from the support of like-minded partners in CBA and x15, who share our mission to help more people on the road to home ownership.”
James Bowe, OwnHome Co-founder
