The Property Wallet: the ultimate property finance platform

Home Made was founded in order to change the residential lettings industry - a sector impacting millions for whom a rental property represents either their largest monthly spend or the most valuable asset they own. Since our inception, we have grown to become the UK’s largest provider of hybrid lettings services, the partner of choice for the majority of Europe’s largest property funds, and have expanded across the UK and beyond.

Today, I’m very proud to announce an important milestone in our ongoing journey with our biggest new product launch since our founding. Introducing The Property Wallet!

This game-changing product builds on our existing landlord platform to solve even more landlord pain points, offering the option to manage all the rental financials directly through a dedicated tenancy bank account, improve cash flow by spreading the cost of letting fees, and by providing unrivalled transparency in property finance management, thus delivering value at every stage of the lettings process.

What is The Property Wallet?

The Property Wallet is a rental income payment solution that is unique in the residential lettings market. Through the platform, we’re able to open a dedicated bank account for each tenancy to process all property payments.  

With the platform, we provide our landlords with an automated rent collection service: tenants pay their rent into The Property Wallet and then we transfer directly to the landlord, and automatically chase arrears where payments are overdue.

By collecting the rent via The Property Wallet, we can offer clients the option of integrating various property payments, as well as spreading their marketing fee payments. Instead of paying a traditional agency all the marketing fees upfront (~1.5 months’ rent for each rental year, following the payment for the previous tenancy termination and any void period), they can pay us a small monthly fee throughout the tenancy.

For example, a landlord agreeing a 24 month tenancy for a property at £2,000pcm would pay a high street competitor £3,800-£5,760 in tenant-find fees, invoiced upfront at the beginning of the tenancy. With Home Made, they will pay £100pcm for the full duration of the tenancy and begin to see rental income in their account immediately.

Along with their tenancy accounts, landlords can still access all of the functions of our existing platform dashboard as we have integrated them into The Property Wallet. This includes an online archive of compliance documentation, live marketing statistics and pricing recommendations when the property is listed for let (e.g. how many ad views, how many viewings, viewing feedback etc), and live tracking of the tenancy administration process.

Why did we build The Property Wallet?

Making the process of letting and renting property better for everyone is our founding ethos, and The Property Wallet represents a win-win-win solution.

We exist to be disruptive, and we are constantly evolving and looking for ways to address pain points for all stakeholders in the rental process. In that spirit, The Property Wallet addresses specific challenges emerging for landlords over recent years as well as long-standing frustrations that property investors face when dealing with the traditional property sector.

The cost of running a rental property has skyrocketed over the past 5 years. With additional compliance obligations, the loss of most buy-to-let tax relief, and inflation more generally, many landlords are exiting the market as their margins are squeezed to the point that their investment is no longer viable.

The current prevailing letting agent operating model exacerbates these issues. Landlords are required to pay thousands of pounds in upfront expensive letting fees when their cash flow is at its most restricted due to expenses associated with setting up a tenancy (e.g. compliance documents, professional cleaning, void periods etc). Many landlords therefore don’t see a penny of rent until months into a tenancy.

With The Property Wallet, we offer landlords the option to pay their letting fees via low monthly payments instead of all at once at the beginning of the tenancy.

With The Property Wallet, we offer landlords the option to pay their letting fees via low monthly payments instead of all at once at the beginning of the tenancy. This reduces the pressure investors have on their cash flow and improves the liquidity of their asset, thereby taking some of the stress out of tenancy setup and giving investors greater financial control over their property. This is even more important ahead of a potential economic recession. As we receive all the rent directly and deduct our fee each month, we also eliminate risk as landlords will not have to pay our fee until we receive funds from their tenants.

This is a win-win-win for everyone:

• Landlords can spread the cost of expensive marketing fees across the lifetime of a tenancy and remove more of the risk from the lettings process.
• Tenants can offer more attractive terms to a landlord working with us compared with offering through an agent, as there won’t be expensive marketing fees to pay.
• We get to double our ARPU.

This is only the first iteration of our new product. In the near future, we will be in a position to integrate even more financial products into the platform to serve client needs. Landlords and renters will be able to purchase third-party tenancy services through the platform, benefit from smart price comparison recommendations for a range of services and financial products, and (pending FCA approval) gain access to various lines of credit on the strength of the creditworthiness they demonstrate via their use of the platform.

With The Property Wallet, we are democratising visibility throughout the tenancy process and giving landlords the tool they need to slash OpEx spend through better financial management and lower fees arranged into a kinder payment structure. We are also increasing the profitability of our unit economics and positioning Home Made to enjoy significant growth with our unique offering to the marketplace.

Proptech is fintech

In many tech and investor circles, proptech is seen as the distant and less glamorous relative of fintech. In reality property is an asset that shares the same features as many other financial products and requires landlords to utilise many of the same banking and financial services as investors with capital invested in other asset classes. Proptech is essentially the optimisation of a specific financial product.

An investment property is, at its core, similar to other forms of financial bond. A property owner holds their investment with the intention of receiving regular payouts (i.e. a coupon) from their asset that they can leverage to increase their returns. Alternatively, the value of the property can be leveraged to acquire capital via secured loans to expand a portfolio even further.

The only major difference between property and other forms of investment asset is its liquidity. While stocks and bonds can be sold in minutes, it can take weeks or months to sell a property. However, what property lacks in liquidity it more than makes up for in resiliency against recession and its value as an inflationary hedge (as property prices and asking rents tend to rise with inflation while other asset classes may lose value), as well as remaining an attractive tradeable product.

Property - specifically residential property - is the largest asset class globally. In London, the average value of a given residential street is often >$500m-$1bn. There is therefore a crucial need for products and services that allow landlords to manage their property as the financial instrument it actually is.

What makes Home Made special is that we increase the value of an asset for our client by a) increasing their rental returns and b) doing so at a lower cost. This is particularly impactful for our Build to Rent landlords, where we increase the value of a Build to Rent asset by an average of 20%, by securing rental rates that exceed client projections, improving the ratio of gross-to-net yield, and increasing NOI.

We increase the value of a Build to Rent asset by an average of 20%

With The Property Wallet, we help private property owners better utilise their asset by providing more control over returns, reducing risk with our investor-friendly fee structure, and improving the visibility of every transaction associated with a tenancy.

This is just the beginning…

The Property Wallet in its current interaction is only the first step in the integration of financial and property management services into our offering. In the near future, our ambition is for The Property Wallet to act as a one-stop shop for every process and transaction associated with running a tenancy, for landlords and tenants alike. This includes a bespoke adjustment to the proposition to serve the unique requirements of our Build-to-Rent market.

Over the past two years alone, our Build to Rent portfolio has grown to 80 different sites with clients owning >60,000 units, while our property management portfolio grew 600% YoY.

Over the past two years alone, our Build to Rent portfolio has grown to 80 different sites with clients owning >60,000 units, while our property management portfolio grew 600% YoY. This has driven expansion into several cities across the UK and our first overseas location. Our inroads into these markets give us an even stronger platform from which to launch, test, and develop our new product so that it can truly revolutionise the whole sector.

Home Made is building the first truly end-to-end rental ecosystem built to support landlords and renters throughout the entire lifecycle of a tenancy.

Home Made is building the first truly end-to-end rental ecosystem built to support landlords and renters throughout the entire lifecycle of a tenancy. The Property Wallet is the successful fruition of the first stage in our mission, with many new updates to be announced over the coming months and years.

We’re very excited to share this news and we can’t wait to reach millions more renters and landlords with our new and improved offering.