Explainer: Our partnership with Abodable in more detail

Some history before we get started

It has never been a tougher time to buy a property in Australia. Decades ago houses and apartments cost around 4 - 5 times annual household income. Over the last 30 years this has gone north of 10 times average household incomes, but that doesn't tell the complete story. Nearly two decades of cheap money (low interest rates) meant that whilst houses cost more the monthly repayments on those houses offset a lot of those rises in terms of affordability.. Many commentators suggest that the low rate environment even caused the rise in prices but it’s more complex than simply rates and that is an article for another day.

What it looks like now, how rates are set

Since the RBA started their ‘belt tightening’ exercise in mid 2022 (alongside other federal banks globally) rates have been going up. At the time of writing the federal rate has gone from 0.1% to 3.60%. Whilst not the only factor that impacts  the rates you and I pay on our home loans it's the main one. Most lenders get money from either depositors (banks) or other investors and they price their expected return (cost of funds) on some measure of the cash rate plus a set margin. As a result when RBA cash rates go up the cost of funds go up for lenders and thus the cost of mortgages goes up. For those in the industry we have simplified this greatly but the principles at play here are accurate. As Australian and other governments globally have increased cash rates the overall cost of money to lenders has gone up.

In practical terms for the typical consumer this means rates have gone from 2 - 3% to 5 - 6%. In turn this means the monthly repayment on a $600k loan has gone from $2530 (3% over 30 years) to $3597 (6% over 30  years).

As well as being over $1000 more a month for the customer it also has another impact. Borrowing power has gone down drastically.

Link between rates and borrowing power

Lenders/Banks each have a unique calculation for their borrowing power or ‘serviceability’. The calculation that looks at your personal and financial situation and says ‘this is how much we are prepared to lend you’. The amount between the 25+ lenders we have at UNO varies hugely for the exact same customer scenario (yours!). It’s one of the key reasons people should see a broker. At UNO we’ve built a real time calculation engine for working out lenders borrowing power highly accurately in a single place. It’s one of the reasons you shouldn’t just see a broker, but a UNO broker.

In any case, back to borrowing power. Whilst they all vary widely in how they determine how much you can borrow ALL of them take into account the repayment you will make on the new loan you are going to apply for.

Put bluntly, as rates go up, borrowing power goes down. A lot.

A single person earning $90k per year, with a credit card of $10k and a side hustle for some extra income could potentially borrow between ~$350k and $800k from the 25 lenders we work with assuming rates at 3%. When rates move to 6% this goes down to $325k - $600k, every single lender goes down.

Property buyers aren’t the only stakeholders who are impacted. When people can’t afford to buy homes this is bad for buyers but also impacts the developers of property who will find it harder to sell the homes they have built or are building.

This problem for both buyers and sellers of property has created the perfect storm for a shake up in the way property, especially new property developments are sold

Enter Abodable

Abodable was started a few years ago by Jake Baird, who had both bought property and had sold it. On going through the property buying process himself and being part of a property marketing and sales company he observed the flow of money.

Property developers typically pay around 3% to a property marketing and sales company for selling their developments. Translating this it’s around $18,000 on a $600,000 unit or $27,000 on a $900,000 house and land package. That’s big money for what is essentially a matchmaking service.

It’s done that way as that’s the way it’s always been done.

Property development is ultimately a numbers game. The sooner you can build and sell your current development the sooner you free up the capital to fund your next (larger) development. The marketing cost is seen as a cost of sales that every just wears and ultimately factors into the price of the property (ie you, the customer, wears it)

Abodable asked the question. Why? Why not operate a leaner organisation, built on technology that could showcase a far wider range of available properties?  And why not pay its team to provide more of a concierge than a sales experience? and why not take the lion’s share of that sales commission and literally hand it back to the customer?

It may seem too good to be true but it isn’t. Hundreds of happy customers later Abodable is leading the way in making the purchase of newly developed property more enjoyable and financially rewarding. It depends on the property but Abodable will rebate up to $50k back to the buyer on settlement. It depends on the value of the property and the development itself (some developers pay higher commissions).

So why did UNO get involved?

First and foremost UNO wanted to find a way to partner with Abodable as we have a shared set of values. We jointly believe in innovation and delivering higher value to customers (even if it means giving up some of our margin). We are both focused on customer experience and creating more transparency. More than that we both believe in a fair go. The current model doesn’t feel overly fair on consumers so if more people knew and used a service like this we at UNO think that would be a step in the right direction.

But our reasons for partnering with Abodable run deeper than this. If you remember back to borrowing power, there has never been a more critical time for how you buy a property and how you organise your property finance to be coordinated.

Put simply, if you can’t borrow enough to buy the place or the finances don’t stack up then even with a hefty rebate you’re not going to be buying a property. Borrowing power is a moving target. Rates change, lenders change, customers finances change. Keeping your property buying concierge in close quarters with your mortgage broker can streamline and improve the customer experience and the outcome.

However, whilst keeping the lines open is key, ensuring the broker and property concierge are not conflicted is also critical. This is why there is no flow of money from referral in either direction for the services provided. If Abodable refers you to UNO, we don’t give them a referral fee. Our UNO brokers don’t earn a referral fee for suggesting you explore using Abodable to find and buy a property either. In the spirit of full disclosure UNO founder, Vincent Turner, is a mentor to Abodable founder Jake Baird. Vincent mentors/advises half a dozen startup founders at any given time.

So what does the partnership deliver?

The UNO and Abodable partnership is focused on creating three things for you the customer

  1. A financial benefit for using the service, in the form of the Abodable rebate, up to $50k
  2. A coordinated experience where the UNO Broker and the Abodable Concierge are able to jointly assist you in their respective areas (requires your specific consent)
  3. A bonus for using both services together, the UNO bonus cashback, set at $1k regardless of property purchased

The entire financial outcome for you is funded through the commission that would have otherwise gone to a more traditional property marketing & sales agency (or avoided if you went to the property developer directly)

As a customer you can start in either place, either by checking out some of the hundreds of developments available on Abodable or by booking in a time with your UNO broker or our customer care team who will assign you a UNO broker

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What our customers are saying

Marlon Baena
July 22, 2024
Karis dedication to assisting with our home loan, even while I was on holidays, truly exemplifies a commitment to excellent service. It's the small things that often make a big difference, and it seems Karis attention to detail and clear communication were key to our smooth home purchase. I highly recommend using UNO and Karis for your home loan needs.
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Olivia Gill
July 18, 2024
We recently used UNO Home Loans to assist us with securing our new mortgage in AU (had moved here from NZ). We had Michael Parsons as our mortgage broker and he was extremely responsive and helpful the whole way through the process. Was a great experience and definitely recommend :)
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Yash Karma
July 18, 2024
Andrew Wyers and team have been amazing. Andrew is very knowledgeable, offers practical advice and he has been pivotal in helping me secure a mortgage at a very competitive interest rate. He was highly responsive to my queries and,being a new immigrant to Perth, he was very patient with my many many questions. An added benefit for me was his knowledge of how superannuation here works. A hec of a great guy to work with, reliable and he goes above and beyond. I would recommend highly recommended him, especially for new immigrants. In fact, I will be using him again very soon!
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Rosie Deiath
July 2, 2024
Karis from UNO was so supportive throughout the entire process of buying our first home. She was contactable at any time, and answered all our silly questions for us. We couldn't recommend Karis and her team enough, as it always felt like she was in our corner with our best interests at heart.
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Jack Mikkelsen
July 2, 2024
We dealt with Karis Churchill as the mortgage broker for our first home. Karis was so supportive and knowledgeable through the whole process! A+ mortgage broker. Definitely utilise her expertise if you’re buying a house!
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Kapil Baldota
June 25, 2024
Eren Tan is absolutely one of the best mortgage brokers in Melbourne! Keeping us well informed throughout the process. Eren gave us a helpful hand in managing to get our loan over the line in a quick and efficient way which is what we wanted and he delivered on that. Thank you Eren Tan!
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June 21, 2024
I only have praise from my Uno experience! I was a broker sceptic, having done all of the hard work myself for my first two property purchases and sale. I'm now a proud broker advocate having used UNO (Karis Churchill) for two refinances and purchase. The value add Karis brought cannot be underrated! Not only has Karis got me the best rate, with a bonus cash back (nearly unheard of in this climate), she has done it with the least back-a-forth and with the least administrative burden on me (the thing that can deters people from refinancing to begin with). Karis is always on top of everything. Karis knows her stuff. She is the most responsive of any professional service provider I've ever used (my banker never text with an update at 7pm on a Sunday) without being overbearing. You know she's got your back and in my experience the value speaks for itself. Thank you to the whole UNO team, thank you especially to Karis.
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Leanda Cawdry
June 8, 2024
Very pleased with the outcome of this process, Michael Parsons and his team at UNO were helpful, communicative, and took all the stress out of the process of finding me a refinance deal that met my needs. Would definitely recommend Michael and UNO, and I already have!
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Glen Matthews
May 29, 2024
Regarding UNO Home Loan services. I had great experience with uno home loans, Michael parsons was my broker for UNO Home Loans we had excellent communication throughout the whole home loan application. If I had any questions on home loan application which were many were answered in great detail. He had the time to assist me in filling out endless application forms at anytime through the day or night which made the application process stress free. So I would strongly recommend Michael parsons from UNO Home Loans to try his services you will not be disappointed. Thanks to Michael parsons I have the lowest home loan interest rate I could ever hope for which I particularly ask for. It’s was a pleasure working with him. And will be using his services in the near future.
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Gillian Anderson
May 28, 2024
Thank you to Michael and UNO for their help in securing our home loan. I like the way they break everything down in simple terms to ensure that you can make the right decision. Michael was polite and very patient to help us get things across the line. We are now sitting in our first home away from rental circus. Can't recommend them enough. Thanks Michael and thanks UNO
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Andy Song
May 17, 2024
Amy has been absolutely wonderful as a broker. I would not hesitate one bit in recommending her services.
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Troy H
May 13, 2024
Scott Wilkinson did a great job as my broker. He was very patient and always happy to answer my numerous questions throughout the considerable period of time that it took to secure a suitable property. Would certainly recommend Scott and the team at UNO for anyone seeking a broker.
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