Uber Co-Founder Wants to Scrap Traditional Mortgages, Co-Invest With Home Buyers

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July 22, 2019

By Taylor Craig

Uber revolutionized the way we get from point A to point B. Now, co-founder Garrett Camp hopes to shake up the real estate industry so more people can buy a home of their own.

Haus, which launched on Thursday born out of Camp's startup studio Expa, helps buyers finance the purchase of a property in exchange for equity. The company aims to make homeownership more affordable, claiming that the monthly payments it collects are on average 30 percent less than what a homeowner would pay in a traditional mortgage.

"We are not a bank or a lender. We are a co-investor," said Haus CEO Jonathan McNulty, a former Trulia executive brought on to lead Camp's company last October. "In our model, you put up 10 percent … and you buy more equity with every payment."

A 2018 survey found that 68 percent of millennial homeowners said they regretted buying a home — a number McNulty calls "awful."

"It's really stemming down to the fact they are spending too much. There's a lot of unexpected expenses," McNulty said, explaining Haus' attempt to lower the monthly burden on homeowners. "We can help people save that money and they can choose to invest in more of the house if they want to at any time."

Haus' success is predicated on a property appreciating in value, so while it shares the reward of having equity, it also takes on some notable risk.

"If you think about what happened in 2008, you had a lot of people putting 5 or 10 percent down, borrowing hundreds of thousands of dollars ... and when the market crashed, they were exposed completely," McNulty said. "We designed [Haus] first to protect consumers … we believe investors can take the long-term view on this."

McNulty re-affirmed Haus' belief in the long-term viability of the real estate market, saying that if homeowners held on to property purchased in 2006 or 2007, their home could be 15 or 20 percent higher in value today.

"From a consumer perspective, we're trying to remove all that debt and that leverage that they've been taking on in this traditional mortgage space and push that away so they're now protected in case the market turns," McNulty said. "The investors can take on that risk."