Why Downsizer?
Sell your stock faster
The requirement to prove a minimum of 100% debt cover through presales has long been a hurdle faced by developers.
“97% of all sales our company has achieved over the past 11 years are to downsizers, who are typically asset rich, but cash poor. For this reason, we believe the Downsizer product will be perfect for our downsizing purchasers"
– Mark Monk, Helm Properties
Benefits for developers
De-risk your presales and achieve ROI sooner
More buyers in the market means sales happen more quickly
Downsizer instantly obtains a digital valuation on the owned home of each potential buyer, directing eligible leads straight to the developer. Our system also allows for land title verification nationally.
Developers get real time info on sales
The presales progress of each project stays updated in real time at every stage of the process – ready to update your bank in a click.
98% of downsizers close the sale
Having downsizers as potential buyers is the best segment to target because they are 98% likely to settle the deal. The lower age brackets are less likely to transact, sitting at around 72%.
Understand your buyers
Knowledge is power and data is knowledge.
Downsizer captures and aggregates crucial anonymised data on a micro and macro level, at every stage of the process, to the benefit of all parties. So, what does this mean?
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Developers get the early inside track on key suburbs where demand is likely to spike, to make the best possible decision about what and where to build.
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Estate agencies can focus sales efforts on fully qualified and motivated downsizer purchasers
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Developers are better equipped to anticipate the needs of downsizers proactively – not years later.
Credeq Australia Pty Ltd (Deposit Power), a subsidiary of the HDI Global Specialty SE, guarantees the bond. HDI Global Specialty SE is a specialty lines insurer. It is owned by HDI Global SE, part of the Talanx Group. HDI Global Specialty’s focus is on writing agency and specialty insurance business with operations in 9 locations and access to a global network of more than 150 countries through the HDI Global SE network. To ensure a local, timely, and independent claim process, HDI Global Specialty SE established a custodian fund with Perpetual Corporate Trust Ltd (Perpetual) to be used solely for the payment of deposit bond claims. As the Authorised Manager of the Guarantor, Deposit Power is authorised to accept, assess, and instruct Perpetual to pay valid claims. Authorised staff at Deposit Power have sole authority to instruct Perpetual to make payment. Such authority to instruct Perpetual is made independently of and without reference to Lombard.
Downsizer offers a new, secure, and cost-effective way to buy property with zero cash deposit and without having to sell first. We streamline the process by using equity in existing property assets to help secure the new home. If buyers have sufficient net equity in their property assets, they could be eligible for a Downsizer deposit bond which is a cash deposit replacement and the full purchase price is paid at settlement.
The bond fee is variable and can sometimes be paid by the developer on a new build or otherwise by the purchaser, the vendor or split between the two on an existing property. A transaction fee of $1,500 applies to all long-term bonds. This is payable by the purchaser following bond issuance.
Deposit bonds are legally valid and available in all states and territories in Australia and widely accepted as a cash deposit substitute. Credeq Australia Pty Ltd (Deposit Power) has been issuing deposit bonds in Australia for over 30 years and our product is very familiar and acceptable to estate agents, solicitors, conveyancers, and sellers (vendors).
Credeq Australia Pty Ltd (Deposit Power), a subsidiary of the HDI Global Specialty SE, guarantees the bond. Bonds issued by Deposit Power have an S&P (Standard & Poors) AA- rating which means it is financially secure and those using the Downsizer deposit bond can feel safe that they are using a globally rated business. The payor is Perpetual Corporate Trust Ltd (ABN 99 000 341 533).
If the purchaser defaults under the terms of the contract of sale, the vendor will be entitled to make a claim on the deposit bond upto the bond amount. The claim is assessed by Credeq Australia Pty Ltd (Deposit Power) as Authorised Manager for the Guarantor, and if valid, payment is made to the deposit holder noted in the contract of sale through Perpetual Corporate Trust Ltd. Deposit Power will then seek to recover the deposit amount from the purchaser.
The purchaser is legally contracted to settle with the developer or vendor on completion of the new property and pay the full contracted price. If the purchaser needs to sell their existing property to fund the new purchase, this must be done prior to settlement.
If you have reached the eligible age of 55 years, you may be able to contribute up to $300,000 (each spouse) or $600,000 (per couple) from the proceeds of the sale (or part sale) of your home into your superannuation fund. For more information please see the ATO site by clicking this link:
Downsizing contributions into superannuation