Frequently Asked Questions

General / Definitions

Homer is a home ownership partner. The academic reference to what we’ve built is shared equity, which is when an investor pays a portion of the purchase price of a property in return for a portion of the sale price of the property when it is sold at a later date. You own the home and decide when to sell whether that be in as little 5 years or as long as 30 years.

Homer for the first time has aligned everyone’s incentives. Previously large traditional institutions didn’t have the capabilities to invest in owner occupied real estate before. This allows us to offer shared equity and rebuild homeownership from the ground-up the way home financing should have been built.

Traditional mortgages won’t go away, there is always going to a mix of debt and equity in the future of owning a home. The benefits to using Homer alongside traditional mortgages mean you can own a home today, save money, get higher purchasing power for a nicer home, never have to pay back the investment until you sell the property, and not have as much downside risk because Homer as an investor shares a portion of any loss you make as well as sharing in any gain.

There are two parties that need to make a return for investing in your home. The first is Homer, then the second is the investors that put up millions of dollars to make this happen. Homer makes money by charging a small $7500 origination fee which is a lot less than the $15,000+ mortgage insurance you would likely have to pay if you bought without Homer topping up your deposit. Our investors share in any rise or fall in the value of your property. Because you are in complete control of the property, including when/if its sold our investors get a higher share of any gain or loss than portion of the property value that they contributed. There’s no principal to ever repay if you don’t want. That’s it. Nobody else wants to tell you this, but you don’t need to rip off consumers to make money, just deliver wonderful products.

We let you decide which home to own. Because we always act in your best interest we’ve restricted the purchase of new build properties, no buy-to-lets, no fixer-uppers, or apartments because we want you in a home that is going to appreciate and be the place where you and your family grow up. We’ve built super smart algorithms to decide this automatically for everyone.

Homer has worked hard to build a smarter solution that allows you to own your home with a small 5% deposit needed because we cover the rest, allowing your money can now work for you elsewhere.

We don’t let you own a home if it’s not in your best interests and you can’t afford it. Just like the traditional methods we assess you on your household income, debt, assets, liabilities, but use smarter technology to understand your true earnings potential.

Our investors are some of Australia’s largest institutions, wealthiest family offices and superannuation funds that are aligned on our mission to make home ownership affordable and accessible for everyone.

Homer has built a new concept from the ground-up, so we’ve got a select few lenders that understand the model and have agreed to lend alongside our investment. Saying this, we’re happy for you to go to any lender it just may take longer, and be frustrating for you.

The HPA is a legal agreement that governs the relationship between Homer & yourself with regards to the shared equity investment in your property.

The HPA covers a range of issues including but not limited to:

  • The rights & obligations of both parties
  • Information about our investors share of any rise or fall in the value of your home.
  • The property purchase & sale process.

    • The HPA is customised to match your individual circumstances but a copy of the HPA template will be available to you when you register with Homer.

You have full control over the property including when it is sold. As the property investor doesn’t know, and has no control over, whether they will have to wait 5 years or 30+before the property is sold they need to be compensated for that lack of liquidity in their investment. Without this it would be impossible for Homer to find investors that would be willing to invest under these conditions.

Approval Process

There are a number of steps in the approval process. Firstly you need to provide all the requested proof of identity documents and your financial information for obtaining the loan pre-approval. You will then need pre-approval of your loan amount from your bank. If you choose to use one of Homer's selected banks we will manage this process on your behalf.

Once you have completed all the steps approval process you will need to sign & return your HPA and pay the Homer Engagement Fee.

The Homer Engagement Fee is $7,500. Homer is a business and we need to cover our costs as well as generate a return for our shareholders. But we believe that the engagement fee is set at a fair level for all concerned.

The engagement fee covers the following:

  • provision of the HPA and other legal documents as required.
  • The deposit bank guarantee
  • Our proprietary property investment analysis process that stops you buying a house that is a poor investment for you and our investors.
  • Support from Homers customer evangelist team to help you with any questions or issues you have when purchasing your home
  • Organising & Managing the investment from our investors.

    • The HPA is customised to match your individual circumstances but a copy of the HPA template will be available to you when you register with Homer.

The engagement fee, minus a small administration fee, is refundable at any time prior to purchase, no questions asked and the HPA will be terminated.

Purchasing the Property

You do. Once you have been been approved by Homer you will be able to go and buy any property that satisfies Homers proprietary property investment analysis process. This process looks after your and our investors interests by precluding purchase of properties that are a bad long term investment. As part of this process we will also determine a maximum price (Purchase Price Cap) that you should pay for a particular property. Certain types of properties are not elegible under the Homer scheme. The prohibited property types are:

  • Apartments.
  • Buildings under construction.
  • Support from Homers customer evangelist team to help you with any questions or issues you have when purchasing your home
  • Properties outside the capital cities metropolitan area.

    • If you are in doubt about whether a particular property qualifies just contact our customer team.

The purchase price cap is calculated by the Homer investment analysis tool and is based off a variety of factors related to the property & its location

Once you have been approved by Homer you will be issued with a bank guarantee for the maximum deposit amount calculated as part of the purchase price cap calculation. You will need to check with the selling agent that they are happy to take this guarantee in lieu of a deposit but we are confident that most if not all will be comfortable with this method.

You can only buy at auction if you have approval from Homer and a pre-agreement from the selling agent that they will accept a 5% deposit only.

Living in your Home

You can renovate the home you buy with help from Homer. You must get approval from Homer if you want to do renovations that:

  • cost $10,000 or more;
  • need a building or planning permit; or
  • involve a structural adjustment to the home.

Homer will decide how your proposed renovations will affect the value of your home. We then use this information to decide whether to approve your application to renovate. You must not do renovations that reduce the value of the home. After your renovations your equity in the home must be the same or more than the equity you held in the home before the renovations.

You must tell the Homer team and the bank that provided the home loan if you start to experience financial hardship. Talk to the bank about your options. You are protected under the National Credit Code. Subject to certain conditions and completely at Homers discretion, our investors may be willing to take a larger equity holding in your property, including moving to 100% ownership. See our Changed Circumstances page for more details

No. The Homer scheme is for owner/occupiers only and you will be in breach of your HPA. If for whatever reason you wish to no longer live in your house you must contact Homer and organise to terminate your agreement with us as per the conditions in the HPA.

Yes as long as you continue to live in the house and have appropriate insurance cover.

Selling the Property

You can sell your property after 5 years no questions asked because Homer’s financing is not meant to be for the short-term.

The net sales proceeds are what’s left after the costs of selling the home. The costs can include payments to the real estate agent, advertising agency and legal costs. After these costs are taken out, the remaining net sale funds will be paid out in the following order:

  • discharge the home loan with bank who provided your home loan
  • pay Homers proportional beneficial interest
  • pay the balance to you.
Taxes & Government Assistance Schemes

Homer has been designed to ensure that you do not miss out on the first home buyers grant if you would normally qualify for it. As this scheme can be changed by the government and is potentially different in each state you should seek your own advice as to whether you qualify.

As with the first home buyers grant we have attempted to ensure that if you would normally qualify for a stamp duty concession or discount then you should still qualify when buying with Homer. As each circumstance is different you should seek independent advice on this topic.