Gravy Raises $2M to Give Renters Taste of Home Ownership

Home-buying platform Gravy said it has launched out of beta and completed a $2.6 million seed funding round.

Gravy gives renters a place where they can save money to purchase their first home, as well as guidance for how to approach home buying.

“Homeownership is the primary way Americans build wealth, but between surging rents and home prices, it’s never been harder to buy your first house,” Co-founder and CEO Jeff Dinter said in a Tuesday (April 26) news release. “We started Gravy to help renters save up, prepare, and ultimately buy their first home with confidence.”

The company says its flagship feature, Gravy Rewards, lets members earn money toward a future home purchase. Once they’re ready to buy, Gravy connects them with its national network of real estate agents and lenders.

Users can earn rewards for things like taking homebuyer education modules, achieving saving milestones and referring friends. These funds are stored in a digital rewards wallet, redeemable only for buying a home.

To date, Gravy said its members have raised more than $100 million in goals for their first home purchases and Gravy has issued more than $4million worth of rewards.

See also: FinTechs, Issuers Rally to Ease Rental Housing Crunch

As PYMNTS reported recently, a growing number of consumers are facing soaring rental prices and fewer home options. In its Quarterly Residential Vacancies And Homeownership, the Census Bureau said the rental vacancy rate was at 5.6% in the last quarter of 2021.

The National Association of Realtors called that it the lowest supply in nearly 40 years in a blog post in February, adding, “With a low vacancy rate, asking rents have increased at an average of 11.2% year-over-year over the past 12 months.”

And real estate brokerage Redfin said in March that rents soared between 2020 and 2021, finding that “The average monthly asking rent in the U.S. increased 15% year over year to a record high of $1,901 in February.”

“When the cost of homeownership increases, many potential homebuyers opt to rent instead, which drives up rental prices,” Redfin Chief Economist Daryl Fairweather noted in a news release, noting that mortgage rates are rising faster than rents. “Americans should brace themselves for continued inflation across the board and try to find ways to cut costs.”