A new rent-to-own housing platform has launched in Atlanta and Phoenix and plans to expand into Florida, North Carolina, Texas, California, Washington, Colorado and Nevada in coming months. 

Pathway Homes was formed by ResiLabs, a new partnership between real estate private equity investor Regis Group, single-family rental landlord Invitation Homes Inc. and venture-capital firm Fifth Wall. The initial program has $750 million of funding commitments. 

Under Pathway, potential buyers identify their ideal home, Pathway purchases it on their behalf and then provides them with options for purchasing the property in the future. In the meantime, the client selects among rent and home-purchase option prices with fixed, below-market annual increases, typically over a five-year term. 

“With the launch of Pathway Homes, we are focused on helping underserved populations who have a steady income but still struggle to qualify for a conventional mortgage because of rising down payments or high credit score requirements,” co-founder and Chief Strategy Officer K.C. Cleary said in a press release. “We offer unique programs designed to meet peoples’ needs depending on their financial situation and ownership timeline.” 

Pathway’s initial program offers three products: 

• HomeStart, which allows customers to move in with only a security deposit. The customer then rents with the option to buy when they’re ready. 
• Savings Match, which enables customers to save for a down payment while they rent with a deposit of just 2.5% of the home’s value. Pathway provides a fixed return on the deposit and a matching contribution that will provide the customer 5% toward purchase. 
• Equity Builder, under which customers can buy half of a home with 5% down while renting the remaining half. This product will be offered beginning in the second quarter. 

“As a single-family home rental provider, we focus on providing choice and flexibility in housing options, and we are excited to now also support those who want to move into homeownership but may not have the financial capacity to do so through traditional options,” Invitation Homes President and CEO Dallas Tanner said.  

All Pathway homes will receive upfront investments to get them in good condition and updated with energy-efficient smart-home technologies. Residents will also have access to Invitation’s property management services, including proactive maintenance and 24/7 access to their maintenance teams.