London-based startup Ahauz, a PropTech firm seeking to help first time buyers get on the property ladder, has raised £300,000 from early-stage investor Forward Partners.
Additionally, the team at Ahauz raised an additional £2.6m from high-net worth property investors.
The money will be used to fund contributions towards the deposit of first time buyers in the UK.
The business was founded by Karthik Srivats and João Rocha after they became aware of the challenges faced by first time buyers in London.
After attempting to buy a house, the co-founders realised they couldn’t afford to pay the deposit required despite having relatively good incomes.
Srivats and Rocha then realised many of their friends had faced similar issues and those who had managed to buy property had received help from family.
AR startup Blippar raising $37m amid losses
Ahauz’s product is similar to the government’s ‘Help to Buy’ equity loan scheme, but it does not restrict consumers to purchasing new build houses. Ahauz does not enforce price caps.
The startup says it is able to provide buyers with a contribution towards their deposit for up to 15% of a house’s value – meaning buyers can afford to purchase a home with a 5% deposit.
Ahauz has partnered with mortgage lenders to make sure its contributions are accepted as a viable deposit.
Rocha said: “We are excited to officially launch Ahauz and to be able to increase the options for so many aspiring first time buyers, while removing the need to save for a back breaking deposit.”
EY’s Olivier Wolf on why tech M&A activity is rising in 2018
Srivats added: “Getting that first foot on the property ladder has seemed impossible for so many young people in recent times and we hope that we’ll be able to help them bridge that gap, making homeownership realistic for all.”
Nic Brisbourne, managing partner at Forward Partners, went on to note why his firm decided to invest.
“We’re incredibly pleased to invest in João and Karthik and in their vision for Ahauz and the housing market. We see huge potential in the business and its model to help a generation to stop renting and start owning,” he concluded.
Check out our UK tech investment tracker for all the latest industry deals.