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Learn more about HOPE's social impact
We partner with the Centre for Social Impact at UNSW to measure and report on the social impact of HOPE’s homeownership solution for Essential Workers and our communities.
Frequently Asked Questions
Capital growth in the properties in the portfolio. These are realised and distributed to investors under three scenarios:
- Full sale of the property
- When the homeowner buys out part or all of the HOPE Fund share. In this case the price they pay for a greater equity stake will be determined by the market price of the property, at the time of the transaction.
- Partial or full refinance of the property, as determined by the market price of the property, at the time of the transaction.
Long-term growth in the Australian property market has averaged around 8 – 9% every year according to Oxford Economics Sydney House Price Index. HOPE believes it can achieve an out-performance of this long-term average of 2 – 3%, based on superior asset selection, pre-purchase due diligence with property experts and valuers, weighting the properties added to the portfolio towards high-growth areas and regions and excluding new builds.
HOPE’s Fund target return of 10% p.a. is net of fees and expenses, before tax. #
What are the returns projected to be and given your non-profit status how will returns be distributed?
We are targeting 10 per cent per annum (net of management fees and other fund expenses, before tax). The HOPE corporate entity is not for profit meaning that management fees will be charged on a cost recovery basis. The HOPE Fund itself will aim to realise a competitive and commercial return to investors distributed on a quarterly basis.
Funded by private philanthropic investment, HOPE is a Not for Profit entity. Hope Fund is an unregistered managed investment scheme and is now open to wholesale investors.
HOPE will provide capital for all types of housing except for off the plan developments. HOPE conducts full pre-purchase due diligence on all assets, including an onsite valuation, which sets the purchase price limit for our co-investment.
The homeowner and the HOPE Fund are not tenants in common. The homeowner is on title as sole owner of the property. As owner of the property they are responsible for all the normal outgoings: rates, utilities, strata fees and property maintenance and insurances.
The Centre for Social Impact at UNSW has helped us to develop a system to measure the social impact our new housing solution will have on individuals, employers and our communities. Enabling essential workers to live close to their place of work reduces travel time and improves work/life balance and physical and mental health. This in turn increases work productivity and decreases absenteeism. It’s all about strengthening our communities. You can read more about our first social impact returns here.
HOPE has accepted investments from a number of individuals and organisations, ranging from $100K to over $5m. This includes well known foundations like the Vincent Fairfax Family Foundation and Private Ancillary Funds like The Paramor Family Foundation. The HOPE Fund is open to any Australian based investor who meets the Wholesale or Sophisticated investor definition.
The Corporations Act 2001 defines a Wholesale and/or Sophisticated Investor as a type of investor who is deemed to have sufficient investing experience and knowledge to weigh the risks and merits of an investment opportunity.
Net worth and income restrictions must be met before a person can be classified a Sophisticated Investor. The distinction makes an investor eligible as a Wholesale and/or Sophisticated client.
Typically, a Sophisticated Investor in Australia must meet one of the following requirements:
1. Has net assets of more than A$2,500,000
2. Has income of at least A$250,000 per annum over the last two financial years
3. Is investing $500,000 or more into the opportunity
Any party investing less than $500,000 will be required to provide proof of the above by providing a certificate from a qualified accountant. Examples of certificates are shown here.
Australia needs more supply, as well as new models of financing home ownership that make existing and new supply more affordable. That’s because new supply on its own doesn’t correlate directly with affordability. If you’re interested in exploring the supply and price dynamic, head here.
We hope that shared equity becomes a financing tool that enables more Australians to achieve home ownership sooner, enabling a more secure future and retirement outlook.
Quite the opposite. As part of the due diligence on every asset an essential worker is looking to buy, HOPE, through its partnership with property valuer Opteon, sets a limit on the purchase price for every property.
Homeowners must stick to this budget, which ensures properties enter the portfolio at the best price possible. This budget process does mean homeowners sometimes miss out, as HOPE will not allow bidding beyond the set budget.
To date 78% of properties that have entered the portfolio have been purchased below the pre-purchase valuation, with the remainder at the budget limit.
THE FINE PRINT
#Target returns only. Investment returns are subject to risk and are based on assumptions. Actual returns may differ and are not guaranteed. Investments will be available to wholesale investors only on terms to be described (including risks) in a private placement memorandum available on request from HOPE.
* Refer HOPE Housing Initial Impact Report – May 2023.
(i) HOPE refers to HOPE Housing Fund Management Limited
(ii) HOPE offers an investment opportunity for sophisticated investors to access the Australian residential real estate market which has had 40+ years of historical growth rate of 7.89% according to BIS Oxford Economic property index. The HOPE Fund’s return may not correlate to the historical returns of the Australian residential real estate market.
(iii) An investment in HOPE Fund gets you access to a diversified portfolio of residential real estate. Homeowners are on title and required to maintain the home and all pay costs. HOPE has priority on all properties within the portfolio