A scheme that offers renters a way to step onto the ownership ladder was given a boost this week, with the Commbank announcing it has invested $31m in rent-to-own startup OwnHome.
With the deposit hurdle rising, the ‘Bank of Mum and Dad’ has become one of the dominant lenders for young Australians. Yet for those who cannot or prefer not to use their parents’ help, building a deposit can be a long process.
OwnHome provides an alternate path to home ownership for aspiring buyers who can afford regular mortgage repayments but don’t want to wait out years while they save the deposit.
The scheme works by enabling approved, credit-worthy customers to move into their own home without the need for a deposit, by paying an upfront fee and making monthly payments that build their deposit over time. After three to seven years, customers have the option to buy their home at a pre-agreed price and put the accrued deposit toward the purchase.
While it might not work for everyone, the scheme offers another path into home ownership. It is always wise, however, to research options carefully and consult with a financial advisor before making any decisions.