A new single-family rental firm will spend $750 million in its strategy to buy customers’ preferred homes and lease them back while offering various paths to homeownership.
Pathway Homes, backed by real estate giants, will offer houses in the Phoenix and Atlanta metro areas in its first step to accommodate customers facing rising prices, constrained supply and competitive markets, it said Thursday. It’s the latest player in the space
The company was formed by ResiLabs, itself established by Regis Group, in partnership with the massive single-family rental investor Invitation Homes and venture capital firm Fifth Wall. Invitation Homes is investing $250 million of equity capital in the launch, it said.
"With the launch of Pathway Homes, we are focused on helping underserved populations who have a steady income, but still struggle to qualify for a conventional mortgage because of rising down payments or high credit score requirements,” said K.C. Cleary, the company’s co-founder and chief strategy officer, in a press release.
Pathway Homes will buy houses with cash offers and set up rent-to-own options with what it said are fixed, below-market annual increases over a five-year term. It also won’t impose financial penalties if renters decide to leave the property. Invitation Homes will provide property management services to Pathway.
The company’s rent-to-own options include HomeStart, which allows renters to move in after providing only a security deposit with an option to buy. Its Savings Match plan lets renters build toward a down payment, with Pathway Homes providing a fixed return and matching contribution over time. A third option to be available in the second quarter this year, Equity Builder, allows customers to buy half of their home with a 5% down payment while renting the remaining half.
Pathway Homes said it will soon expand to the West Coast and Sun Belt regions, home to
