Allianz GI to provide institutional financing for gradual homeownership model
Allianz Global Investors (AllianzGI) has launched the Home Equity Income Strategy, which will see the firm raise finance from its institutional clients to support the launch of Wayhome, a new way to gradual homeownership without a mortgage in the UK.
The partnership between AllianzGI and Wayhome will open up a new market for institutional investors, one that aims to offer reliable, inflation linked yields that suit the cash-flow profiles of DB (defined benefit) pension funds, whilst helping more aspiring homeowners get on the property ladder.
The capital raised from institutional investors will allow Wayhome to purchase homes with aspiring homeowners who are unable to purchase their own home through traditional ways of buying a home. Wayhome’s model enables customers to part-own, part-rent a property. Customers can purchase with as little as 5 per cent deposit, and then rent the rest. They can then buy more of the property, reducing their rent, whenever they want.
Hugh Boyle, CEO Wayhome, says: “Our partnership with AllianzGI means ‘reluctant renters’ – those who would prefer to own their own home - will soon have a new way to homeownership, without a mortgage.
“AllianzGI’s involvement will help us unlock the institutional financing we need, to open a path to homeownership for hard-working families, like those currently paying off somebody else’s mortgage.”
Irshaad Ahmad, Head of European Institutional at Allianz Global Investors, says: “AllianzGI has a great track record of helping open up new markets for our institutional clients, giving them access to new types of cash-flows that help them match their liabilities. We did it with infrastructure debt and now we plan to do it again through Wayhome’s gradual homeownership model.
“We continue to see significant institutional investor demand for the type of cash-flow matching that this partnership with Wayhome is set to provide. We have been impressed by the concept the Wayhome team have created over the past few years and look forward to helping them bring this innovative new idea to market”.