Episode overview

Steve Grace sits down with Stephen Zilioli, founder of PostLock, to work through one of the most fundamental problems in housing policy: the savings gap. Most products tell a first home buyer to save 20% of a target price without acknowledging that the target is moving faster than any savings rate. PostLock is built around closing that gap through a government partnership that links the saver’s return to actual property price growth in their chosen suburb.

The problem with every existing savings product

Standard savings accounts give savers a fixed return, currently around the RBA cash rate. Property prices in Australia have historically grown at 7 to 10 percent per year in major markets. The brutal reality is that every standard savings calculator showing a saver their “target” is lying by omission: the target is not static. It grows every year. A saver putting money away at 4.35 percent while their target suburb grows at 8 percent is falling behind every single year regardless of how disciplined they are.

Stephen identifies this as the core problem PostLock solves. Not the deposit size itself, but the fact that the goalpost moves faster than the savers can run. PostLock neutralises that dynamic by giving savers a return that matches the growth of their target suburb.

How PostLock works in practice

A saver selects a suburb they aspire to buy in. They open a PostLock account and their money goes to government, not to PostLock. They earn the RBA cash rate as a base return immediately. If they ultimately purchase a home in their selected suburb, they receive an additional return equal to the local property price growth over their savings period, capped at 10 percent total to protect taxpayers.

The product is not a locked-in instrument. Stephen is clear that people’s lives change and the product needs flexibility. If you move, change suburbs, change cities, or never buy, you can access your money at the base rate. The premium return is tied to the purchase outcome, not the savings journey itself. The data PostLock holds, where you live, where you saved, and where you bought, is what allows the model to function while managing the risk of people gaming the system by saving in high-growth suburbs they never intend to buy in.

Why the UK and why government as the counterparty

Stephen’s background in Australian banking included an early conversation with a Mercer Consulting contact who explained clearly that banks would never do this product. They carry quarterly mark-to-market pressures and do not want long-term exposure to property price indices. Government, by contrast, is perfectly aligned: it wants homeownership rates to rise, it has no profit motive to extract fees, and it is the safest possible counterparty for consumer savings.

PostLock pursued government engagement in both Australia and the UK. The UK proved more receptive at an earlier stage. Progress in the UK has given PostLock a real-world proof point and reference case for Australian government conversations, which Stephen characterises as moving slowly but steadily in a positive direction.

Six years of incubation and the leap to full-time

Stephen spent two to three years developing the concept as a side project, during which he was having substantial conversations with banks and politicians while his LinkedIn profile still listed a different employer. That gap between where his energy was and what his business card said created a friction he describes vividly. Going full-time was simultaneously terrifying and liberating: the conversations could finally match the commitment, and the outcome, whether success or failure, would be fully his to own.