Stewarding Societal Capital: Our assets of wellbeing
Debt lets us trade future potential for value today, for a commitment to repay, with interest, over time. An early cornerstone of civilisation, it’s built on a sophisticated set of ideas that only humans have mastered: trust, the future, potential, medium of exchange, methods of account, and protection of rights.
These are the foundational elements of a free world where commoners can own property. Today, the right to homeownership is taken as granted but access to the debt that makes it possible is receding. Long accepted as the foundation of middle-class wealth generation, homeownership is no longer a middle-class rite of passage.
Most free societies recognise this, and many are working to treat symptoms such as constrained supply and high prices. Results vary but trends are clear, we’re falling back toward becoming a society of renters, with private landlords replacing the nobility. And the longer each generation’s access to homeownership is restricted, the more this trend accelerates.
OSQO exists to improve access to the debt that makes homeownership possible, approaching it as an investment in our future, where each generational middle-class wealth base becomes a foundation for the next. A healthy system with homeownership as the main engine for growing middle-class wealth and intergenerational wealth transfer, is the best investment we can make in our assets of wellbeing, societal capital.
OSQO lends homebuyers the money they need for their deposit gap. Investors (which can include mum and dad) provide the funds as a managed investment and earn the same interest rate that the homebuyers would pay the bank while they pay down their mortgage.
Once there’s enough equity, through value growth and principal repayments, they refinance their mortgage and pay back the deposit gap loan plus a pro-rata share of the value growth of their property.
Mum and dad get a structured investment arrangement with their kids, other investors make up any shortfall. Homebuyers can access the property market without having to save for a 20% deposit or buy lender’s mortgage insurance to insure a bank.
If we’re to sustain middle-class wealth in the next generation, we cannot simply democratise access to the stock market while denying access to homeownership.