Historically, rental real estate has been very transactional. Owners get rent. Renters get a place to live. Temple believes there can be more to it.
Many renters want more than just a place to live. They want a home.
Specifically, they want to own a home. For many young people that can feel out of reach.Temple creates a foundation of alignment by helping its tenants cross the bridge from renter to homeowner.
A successful, durable business requires several key ingredients: Long-term thinking, independence, conservative debt policy, and unified purpose for stakeholders.
The closer the alignment, the more durable the company becomes. That benefits the customers, the owners, and the investors.
At Temple we want to build something that can last for 100 years and beyond. Not “just a startup”.
This philosophy is what drives Temple’s dedication to its future owners.
Temple’s future owner model provides many unique benefits for both renters and investors that standard rental models don’t:
- Giving an individual or a family a vision and roadmap for their home and for their household’s future. It not only attracts better tenants. It creates them.
- A tenant who views the property as their own long-term home will take better care of it, reducing maintenance costs.
- Tenants who stay longer lead to better, more-stable communities and lower turnover costs.
- This model reduces the cost of capital as the future owners contribute part of the equity needed to buy buildings.
- This model reduces information asymmetry. The more a purchaser knows about a home, the safer they feel paying a higher price for the home. The ability to “test drive” a property gives the tenant valuable information, reassuring purchasers of the quality of the home and increasing the price they are willing to pay for it.
References
J.Mauboussin, M.J.M., Majd, D. and Callahan, D. (2017) Corporate Longevity Index, Turnover and Corporate Performance, Credit Suisse. Available at: https://research-doc.credit-suisse.com/docView?language=ENG&format=PDF&sourceid=csplusresearchcp&document_id=1066439791&serialid=4uA2wHojCvFKzqWfwIyDvkSN1pkXRpb43LvyclLcJsk%3D&cspId=null (Accessed: 26 June 2023).
Temple (2023) Century-old businesses surviving secrets:, JustPaste.it. Available at: https://justpaste.it/cayzb (Accessed: 26 June 2023).
Wei, W. (2019) Corporate longevity, Brunswick. Available at: https://www.brunswickgroup.com/corporate-longevity-i10173/ (Accessed: 26 June 2023).
The market for Lemons (2023) Wikipedia. Available at: https://en.wikipedia.org/wiki/The_Market_for_Lemons (Accessed: 26 June 2023).
