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Jay-Z-backed Landis wants to make home ownership more attainable

Landis is a startup that uses tech and data science to help Americans reach homeownership.

Homeownership is the proverbial great American dream. Yet it’s off-limits to many, says Cyril Berdugo, co-founder of Landis, a New York City-based real estate technology company on a mission to make home buying more accessible. The company is backed by Jay Z’s Roc Nation’s Arrive and Will Smith’s Dreamers VC.

“There’s an affordability crisis in the U.S. that’s mainly due to a lack of inventory,” he explains. “The people who get disadvantaged are those trying to reach homeownership for the first time but can’t afford to buy. These people are often competing against cash offers.”

To solve this problem, Landis came up with a system to make the process easier and more attainable. Here’s how it works: Prospective buyers (some referred by their real estate agents or mortgage lenders who’ve turned them down) apply to the Landis program. “By working with us, mortgage lenders don’t need to fully turn people down,” Berdugo explains. “They can give them an option they would not have had if we didn’t exist.” Then, within 24 hours, the company lets prospects know if they pre-qualify. Prospects then submit income verification documents.

While they look for a home with the help of their real estate agent (or an agent Landis refers), a Landis Homeownership Coach helps them improve their credit score, save up for a down payment, and understand the mortgage process. Once they find a home they want to buy, Landis takes over, handling the appraisal and inspection processes and buying the property in all cash. The prospect just needs to pay 2% of the purchase price as their initial down payment.

“We’re able to make a bet on our clients’ success by telling them they can find a home they love,” says Berdugo. “This is also good news for the brokerage community since agents who send us clients make their full commissions.” Not surprisingly, thousands of agents nationwide plus the National Association of REALTORS now partner with the company.

Once Landis purchases the home, the buyer rents it for up to two years. During this period, the Landis Homeownership Coach continues to help them work towards their goal of owning the home. At any point during the rental period (up to the two-year mark), buyers can get a mortgage from a lender and buy the home from Landis.

The pre-set sale price is the appraisal value at the time of Landis’ purchase plus an additional 3% (during the first 12 months of rent). After 12 months, the percentage increases, totaling 6% by 24 months. “We’re completely aligned with our clients, meaning we only succeed when they succeed in reaching homeownership,” Berdugo says.

The formula seems to be working. Founded in 2018, Landis now serves more than 50 cities in the U.S., recently adding Florida to the mix. “Florida is a massive priority for 2022,” Berdugo says, revealing that the company already covers Orlando, Tampa, Jacksonville, Miami Dade, and Broward Palm Beach.

“The opportunity to transition Floridians to first time homebuying is huge,” he adds. “While the nationwide homeownership rate in the U.S. is about 65%, it’s lower in Florida. So, the state needs to catch up with the rest of America. A lot of minorities in Florida have been disregarded or marginalized by mortgage lenders.”

To help its brokerage and mortgage lender partners continue to help would-be first-time homebuyers, Landis makes its program simple. “Everything’s online and automated. Partners can create a log-in and start referring clients.” To help them succeed, the company has a team dedicated to partner onboarding and education. This win-win approach for all parties should fuel Landis’ continued expansion, predicts Berdugo.