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

Sally Mackenzie
February 19, 2024
We chose Uno Home Loans from their impressive web site knowing we were going to find it hard, on many fronts, to qualify for a home loan. We were incredibly fortunate to be assigned Mike Parsons as right from the get-go, despite the complexities, he hit the ground running for us. He was incredibly knowledgeable, with years of experience but what was immediately apparent and impressive was that he was totally invested in getting us over the line, doing absolutely everything possible, including working around the clock. Despite it being a relatively small loan in the order of things, Mike never missed a beat, getting docs ready, following up and answering every request from the proposed funder immediately. He kept us informed on progress the minute anything happened, and again if anything needed to be done, he was right on it. In short, we highly recommend Uno, and Mike, knowing what a remarkable job he did, over many weeks, to get us our loan. He got us a great deal, with far better rates than we expected, so we couldn't be happier. In fact, without doubt, you'd be hard pressed to find a more personable, sharp, hard working, dedicated professional who clearly prides himself on getting his customers standout results.
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February 13, 2024
Scott and his team were just A-mazing. We felt supported through the whole process with the greatest quality and care. Every question answered right in time, or even before we asked. The process was smooth and we got the best outcomes we could have wished for.
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Angela Biddle
February 6, 2024
Our mortgage recently came up for renewal, and with interest rates skyrocketing we were looking for ways to minimise the impact. Michael and his team were proactive and attentive. Michael spent time with us to understand our circumstances. He found mortgage options that worked with our current financial situation and longer investment plans. He presented clear options, providing guidance where needed. He and his team were helpful and responsive - streamlining the process and keeping us updated through the negotiations. In the end, Uno did the heavy lifting and secured a significantly better rate than our current bank offered, all with friendly, personal service. We would highly recommend UNO Home Loans.
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Fotis Bikas
January 15, 2024
I cannot help but congratulate Scott Wilkinson of UNO Home Loans for being an absolute credit to both his company and the entire loans industry. Scott is a truly rare gem of a broker in that he will not only go the extra mile to achieve for each customer the very best deal, but his knowledge of all and sundry within the industry is unsurpassed (you will see what I mean if you speak to him). Additionally, Scott has a clear passion for imparting his wealth of information with each customer, whereas the conversation with most other brokers would simply be over if they could not get you the best deal. For me, Scott Wilkinson of UNO Home Loans stands head and shoulders above the competition and I feel privileged to benefit both from his expertise and professionalism whenever it is time for a refinance or new loan.
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Tomoharu Matsui
January 11, 2024
Michael Parsons helped me a lot when it's difficult to establish my capabilities in loan.
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Gillian Kearon
January 9, 2024
I highly recommend Mike Parsons as a mortgage broker. I couldn't fault the service provided by UNO. Thanks Mike!
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Taner T
December 20, 2023
Thank you Eren Tan for the amazing service and support. Our Loan was a little tricky and complex for other lenders but Eren managed to get it over the line in record time. His professionalism and dedication to our needs was exceptional. If you need a Loan no matter how complex your situation, make sure you contact Eren at UNO Home Loans.
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Karaipu Brown
December 20, 2023
Buying & selling a house at the same time is very stressful but Scott Wilkinson from UNO home loans made sure we knew what was happening & took most of the stress away. He always kept us up to date and if we had a concern or wanted clarification on something we were able to call him, if he didn’t know the answer straight away he will find out and contact us back.. now we are enjoying our new house and turning it into a home :)
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Chris Anderson
December 18, 2023
Just completed my first loan with UNO which was so much easier than with other other brokers I have used in the past. Our broker MIKE PARSONS always had time for me and broke things down for me in the simplest of terms and was very patient with my silly questions and my constant changing of plans. I wish I had used them in the past as I wouldn't be in the situation I'm in now. Can't recommend them highly enough. Thanks UNO and Thanks MIKE 😊
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Stephen Broomfield
December 11, 2023
To be able to recommend Scott Wilkinson for your mortgage broker was a privilege. We had deals fall through but Scott supported, guided and stuck with us, proper partnership. The whole team at UNO helped us and supported us right through to after settlement. Made sure everything was correct and how we are progressing. Communication was amazing and straightforward and easy to understand. Transparent. We can not Recommend Scott and the team as Uno high enough. Use UNO with confidence.
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Tarek Hussain
December 6, 2023
Can't thank Amy enough for her hard work, dedication and determination on getting multiple loans completed for me. I wouldn't hesitate in recommending Amy and the Uno team to any of my associates. Will definitely be back in the near future!
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November 3, 2023
If you’re looking for a trustworthy, thorough, reliable & knowledgeable Mortgage Broker then you must call Anita Callaghan! I can’t even imagine how stressful this process would’ve been without her. Anita went above and beyond to make sure she answered every question, responded to every text (even on weekends/after hours), and followed up on every detail to ensure we had all the info we needed. Anita is a true people person who is warm, empathetic, kind and supportive. You can tell she loves helping people and loves what she does, which is probably why she’s so good at it! Can’t thank you enough Anita, or recommend you more highly! You’re the best!
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