Your Dream Home, Right Now

New real estate startup brings easier homebuying model to Austin

Don't let a large down payment stop you from getting into your dream home.

Photo courtesy of ZeroDown

Another real estate startup is coming to Austin, aiming to disrupt the expensive and stressful process of buying a home.

Called ZeroDown, the company offers a uniquely modern solution to the rent vs. buy dilemma through its "lease-to-own" product. It works like this: Customers go shopping for their desired move-in-ready homes listed on the market, which ZeroDown buys for cash and rents back to them.

Customers pay rent to ZeroDown and have a valuable option to buy the home on their own timeline at an attractive price. That's because ZeroDown will increase the purchase price for the customer by 2.5 percent per year during the three-year option period, a small fraction of the 12.1 percent year-over-year home price appreciation calculated by the Austin Board of Realtors for September 2020.

All of the upside above the 2.5 percent annualized level can be captured by the customer if and when they choose to buy the home from ZeroDown. Unlike a mortgage, there is no upfront down payment involved, even for pricier homes above $1 million, and the customer can decide to leave the home anytime after two years without the intense friction of having to list and sell the homes themselves.

"We created ZeroDown so that you don't have to wait to live in the home that you want," says co-founder and CEO Abhijeet Dwivedi. "You can find a home you love, move in, and then build toward ownership."

Austin is the third market for ZeroDown, following successful launches in Seattle and its hometown of San Francisco.

ATX's status as a hub of major real estate innovation — with companies such as OJO Labs; Opcity, which was acquired by Realtor.com in 2018; Archetape; Upequity; and Homeward — played a role in ZeroDown's decision to make the region its third market.

Like San Francisco and Seattle, the area is home to a fiercely competitive housing market, and committing to a big down payment is a challenge for many buyers, even those with high incomes and strong credit.

If you're wondering how ZeroDown makes any money with this model, here's your answer: Commissions from agents. The company also offers a "white-glove concierge service" that includes help with cleaning, moving, furnishing, and more.

The company has raised over $150 million of debt and equity capital in its lifetime, with equity from Y Combinator, the accelerator's former president Sam Altman, and Goodwater Capital, and a credit facility from Credit Suisse and Blackstone to buy homes for customers.

"The housing market has changed," says Dwivedi. "Why should our approach to it stay the same?"

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Visit ZeroDown.com to search available listings, review market data, and learn more about the process.

promoted home-for-sale

buying in the big city

Austin ranks among 20 best large U.S. cities for first-time homebuyers

14608 Minifee Street, Austin home for sale

Photo courtesy of Zillow

This charming home in far East Austin is on the market for $310,000.

As Austin's real estate market slowly bounces back after several years of high housing prices, a new WalletHub analysis has revealed it is the 19th best large U.S. city for first-time homebuyers, and the No. 1 big city in Texas.

WalletHub's study ranked 300 U.S. cities across 22 metrics based on affordability, quality of life, and the status of each city's real estate market, including factors like active listings per capita, homeownership rates for millennials, and more. Cities were ranked overall and based on population size: Large cities with more than 300,000 residents; midsize cities with populations between 150,000-300,000 people; and small cities with fewer than 150,000 people.

Palm Bay, Florida ranked as the No. 1 best housing market for first-time homebuyers regardless of city size. Meanwhile, the report determined Tampa is the best large city for first-time buyers.

Austin earned a favorable No. 10 rank in the report's "real estate market" category, though it didn't earn quite such stellar rankings in the quality of life (No. 120) or affordability (No. 257) categories.

Despite the city's abysmal affordability ranking, there are many ongoing initiatives to bring more affordable housing to Austin. A local nonprofit recently broke ground on a new housing development specifically geared toward Austin's senior-aged LGBTQ+ community, and 104 deeply affordable tiny homes are currently under construction in southeast Austin.

Habitat for Humanity has also expanded its qualifications to help middle-income families buy homes in the city, and local nonprofit SAFE Alliance is developing its own affordable supportive housing community for family violence survivors.

Austin has the 9th highest rate of new home construction in the nation, with several more housing developments underway in some of the city's most popular suburbs, including Manor, Bee Cave, Bastrop, and Georgetown.

In the overall rankings — regardless of city size — Austin landed as No. 105 best place for first-time homebuyers out of all 300 U.S. cities.

According to the National Association of Realtors, only 24 percent of all home purchases in the nation were made by first-time buyers in 2024, down from 32 percent in 2023.

"Buying a home for the first time is a very stressful and difficult process, especially when housing prices are through the roof and interest rates have risen sharply in the past few years," said WalletHub analyst Chip Lupo. "The best cities for first-time home buyers not only are affordable both in terms of buying a house and living there afterward, but they also have a lot of housing choices as well as low crime rates and good schools."

Here's how other Texas housing markets fared in the report's ranking of the best large cities for first-time homebuyers:

No. 27 – Fort Worth
No. 31 – El Paso
No. 37 – Corpus Christi
No. 38 – Arlington
No. 39 – San Antonio
No. 51 – Dallas
No. 56 – Houston

austin real estate housing market first time homebuyers wallethub