{"version":"1.0","type":"rich","provider_name":"Acast","provider_url":"https://acast.com","height":250,"width":700,"html":"","title":"EP191: Down Payments for Airbnb Hosts","description":"Airbnb is often cast as the villain in discussions around affordable housing. Aspiring home owners struggle to afford the 5% down payment required for a conventional mortgage, and as increasing numbers of real estate investors use platforms like Airbnb to accommodate tourists, prices get further out of reach for would-be residents.
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\nYifan Zhang is re-casting Airbnb as a force for good in affordable housing with the launch of her new startup. Yifan is the co-founder and CEO of Loftium, a service that provides prospective home buyers with up to $50K for a down payment with the caveat that they list an extra bedroom on Airbnb for 12-36 months, and share the profits with Loftium for the length of the contract.
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\nA 29-year-old Harvard grad with experience in the startup world, Yifan became an Airbnb host when she and her husband bought a townhouse in Seattle. The revenue stream from their spare bedroom covered the couple’s mortgage payments, and Yifan got the idea to help prospective home buyers come up with a down payment based on the potential profit of listing a spare room on Airbnb. Today she discusses rising home prices in the US, the strict mortgage regulations in place, and the media attention Loftium has received since its launch. Listen in to learn how the application process works, what happens if a customer breaks their contract, and how Loftium shares Airbnb profits with its hosts.
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\nTopics Covered
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\nHow Yifan got the idea for Loftium
\n•\tTried hosting herself in apartments, always got caught
\n•\tBought townhouse with husband in Seattle
\n•\tListing spare bedroom on Airbnb covered mortgage
\n•\tSeeing revenue stream gave her idea to solve down payment problem
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\nHow much a typical down payment costs in the US
\n•\tConventional mortgage requires minimum 5%
\n•\tFirst-time home buyers who meet qualifications can get 3%
\n•\tAverage price of home in Seattle is $700K (5%=$35K)
\n•\tDifficult to save for down payment
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\nThe strict mortgage regulations in the US
\n•\tCan’t use just any funds
\n•\tMust save up for years
\n•\tOnly other option is gift from parents
\n•\tLoftium is first regulator-approved source of down payment funding
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\nWhere Loftium operates
\n•\tProduct launch in Seattle
\n•\tPlans to scale to other cities
\n•\tVote for expansion cities on website
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\nLoftium’s current partners
\n•\tMortgage provider Umpqua Bank
\n•\tApply down payment to conventional Fannie Mae loan
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\nHow the Loftium process works
\n•\tGo to loftium.com
\n•\tLook up home for sale
\n•\tPlatform gives estimate of down payment
\n•\tUse funding to make offer
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\nWhat happens if Loftium customer breaks contract
\n•\tPay back pro-rata amount of time remaining + termination fee
\n•\tNo consequence if hosting traffic declines
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\nHow hosts and Loftium share Airbnb profits
\n•\tSplit varies, adjusted based on how much customer needs for down payment
\n•\tTypical split is 70/30
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\nHow Loftium handles changes in regulations
\n•\tOnly open in markets with regulatory approval
\n•\tRestricted to spare bedroom in primary residence
\n•\tIf rules change, Loftium has second lien on property
\n•\tCompany gets paid back when customer sells house
\n•\tNo cash burden on customer
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\nLoftium’s competitors
\n•\tClearBank (Canadian lender)
\n•\tWorks exclusively with existing hosts
\n•\tLoans for furniture, renovations
\n•\tRecently added property
\n•\tMost Loftium customers are first-time hosts
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\nHow Loftium supports its customer-hosts
\n•\tProvides automation, software
\n•\tPartnering with existing companies
\n•\tPlan to supply suite of services
\n•\tAutomated keypad, smart messaging, pricing tool
","author_name":"Freewyld Foundry"}