‘Lease to own’ housing scheme to make Australian property ownership more accessible

A novel ‘lease to own’ housing model is poised to revolutionize the Australian property market, offering a lifeline to many aspiring first-time homeowners grappling with affordability challenges. In Sydney, where the average individual currently requires over 12 years of savings to afford their first home, this new model developed by Ownlea aims to significantly shorten the timeline for property acquisition.

James Alexander-Hatziplis, co-founder and CEO of PLACE Studio, the company behind Ownlea, has detailed their mission to “democratise property ownership, by empowering occupants to build equity gradually by leasing with the ability to purchase, rather than renting with no end in sight.” Pacific Community Housing has also joined the initiative as a partner, with Director Matthew Daniel expressing his enthusiasm for the project that promises to provide “sustainable pathways for Aussies to get into a new home sooner.”

The ‘lease to own’ model mirrors arrangements found in car leases or mobile plans, allowing eligible individuals the opportunity to purchase their property and pay it off throughout the life of the plan. Unlike traditional purchasing methods that demand substantial initial deposits, the average Ownlea buyer only needs $12,500 to enter into a contract.

This innovative agreement includes a 5-year term, during which tenants can opt to buy the property at any time. It encompasses a fixed sum covering utilities and strata, with rental increases kept below 4% annually. Additionally, tenants are encouraged to make supplementary payments towards homeownership without the pressure of obligatory extra contributions.

Alexander-Hatziplis highlighted the simplicity of the process, saying, “When you choose an Ownlea property, you enter into a 5-year agreement. Think of it as your stepping stone to owning your home.” He went on to explain that Ownlea’s unique model benefits not only the tenants but also investors and developers by providing “security along with consistent returns.”

Moreover, Ownlea’s approach supports local communities through neighborhood stability and encourages long-term investment. The company’s extensive network of suppliers and service providers also stands to gain through continued collaboration.

Expressions of interest for the pilot project will commence in February, with construction set to begin in mid-2024 at the inaugural development site in Sydney. This venture represents a significant step forward in making property ownership within reach for many Australians, particularly in a market where traditional pathways have become increasingly unattainable for younger demographics.