As read in MortgageBusiness Oline -The major bank has developed a new mortgage product in partnership with a co-ownership platform, positioning the product as a potential solution to Australia’s housing affordability crisis.
Launched this week, Kohab is an online marketplace for co-ownership of property and helps potential buyers in three ways: by co-living (whereby one or both parties choose to live in the property), by co-investing in property and by co-lifestyle — facilitating two or more parties to share a holiday home or second home.
The platform, which the group is calling a “world first”, helps like-minded buyers purchase a home together, connecting them with property, real estate agent, legal, mortgage and insurance providers.
Kohab has selected platform partners such as National Australia Bank for their expertise in property co-ownership.
“While CBA has a co-ownership-type product called Property Share, we worked with NAB very closely in developing one that is a little bit more bespoke and targeted to co-ownership of family and friends specifically,” Kohab’s Andrew Thain told Mortgage Business. “That’s an area that they think is critically important.
“It is called the Co-Borrower Loan. It has been developed specifically for Kohab.”
The introduction of co-ownership mortgage products holds each party responsible for their part of the loan only. This means that individuals do not have to guarantee their co-buyers mortgage repayments, and if buying half or a quarter of the property, their deposit and repayments are based only on that percentage ownership.
The platform’s co-ownership agreement has been specifically developed by legal firm Sparke Helmore to provide a safe, transparent and secure way to buy and sell property together.
“We believe that co-ownership is an often overlooked method of owning property and may hold the key to that dream being reignited, allowing many Australians to take the first step on the property market ladder,” Kohab founder and CEO David Dawson said.
Research commissioned by Kohab in February involving over 1,700 Australians found that of those who currently don’t own property, the challenge of saving enough for a deposit and being unable to afford a property in their preferred location were cited as the main reasons for being unable to accomplish that life goal.
The research also found that 27 per cent of respondents would consider buying a property with someone else, while a further 9 per cent would consider co-ownership if they were equipped with more information.
“The phenomenal growth of brands such as Uber and Airbnb has clearly demonstrated that the share economy is alive and thriving,” Mr Dawson said.
“These types of concepts have created a seismic shift in how society views co-sharing in general. As such, Kohab aspires to be the global platform and marketplace for property co-ownership.”
The platform will soon enable existing property owners to unlock equity and sell a portion of their property, which may appeal to existing investors or an older demographic.
“With Sydney and Melbourne now ranking the second and fifth most unaffordable cities in the world, Kohab will offer one of the key answers to the housing affordability issue in Australia,” Mr Dawson said.
“We want to see more Australians ultimately owning their own home, and we are committed to educating the market on co-ownership options and facilitating those opportunities.”
Kohab’s partners and stakeholders include Laing+Simmons Corporation managing director and REINSW president Leanne Pilkington; Sparke Helmore partner David Reid; NAB EGM global institutional banking Spiro Pappas; Austbrokers ABS general manager Rebecca Wilson; and former CoreLogic CEO Graham Mirabito.
John can be contacted on 0749722081 or 0410433919. Or email him at jwhitten@ihl.net.au or net www.ihl.net.au. John Whitten is a credit representative (CRN 399796) of BLASSA Pty Ltd (Australian Credit Licence No 391237).
