Bilt 2.0 is Coming

Tl;dr: Bilt recently asked cardholders for feedback on some potential future card options—all of which are worse than the current card. But it’s not all bad news.

On Thursday, Bilt sent out a survey to its cardholders asking for feedback on the possibly evolution of the Bilt card, asking members to vote on which of some potential card options they preferred. While those offerings are hypothetical at this stage, all the offerings are, in my opinion, a step down from the current card (not entirely surprising, given the ludicrously good value proposition of that card). But it’s not all bad news. At least one option presented a no-net-fee version of the current no-fee card and the next generation of cards looks like they will also offer the option to earn points on mortgage payments. And with more details yet to be announced, there’s plenty of room for other ways for Bilt to make these cards even more appealing.

What is Bilt 2.0?

Bilt founder and CEO Ankur Jain emailed Bilt members at the end of last year, announcing that the credit card program would evolve to “focus on tiered offerings that better serve different member needs while delivering enhanced value through new benefits on housing spend and our neighborhood network.” Jain identified three main areas of focus going forward.

First, Jain wants Bilt 2.0 to offer points on housing, whether members pay rent or make mortgage payments. This makes sense. Over the past few years, the Bilt card has been an absolute must-have for renters. But while it was an excellent card even for non-renters, it didn’t offer anything particularly special to them. This meant that its appeal to a large and affluent swathe of the market was limited.

Second, Jain wants cardholders to “engage with the broader program” rather than just take advantage of “loopholes.” Currently, with a Bilt card you can get tens of thousands of points for rent payments with no fees after making only five purchases in a given month. It’s an incredible deal, but obviously unsustainable for Bilt, and they need to target the the people who engage more with the aspects of the business where Bilt actually makes money (e.g. swipe fees).

Third, Jain wants to provide more options, specifically no-fee, mid-range, and premium card offerings. Much like expanding rewards to mortgage payments, this would allow Bilt to compete across all sectors of the market. I imagine this would also allow Bilt to develop relationship with young, lower-income renters and then grow with them as their incomes rise over time.

The next evolution of the Bilt card will offer points on mortgage payments.

What options are being considered?

As Bilt executive Richard Kerr made clear in an email to TPG, the products floated in the recent survey are far from guaranteed, it’s a fascinating (and slightly concerning) look at what Bilt has in mind for this next evolution. Here is what survey-takers were asked to consider. All cards have a base of 1x points on all spending, unless otherwise noted.

Note: a lot of the possible cards have various spending bonuses on minor categories like Bilt dining and fitness, Lyft, and Walgreens. These might matter to some users, but will be minor expenses for the vast majority of consumers.

No fee cards

These would both offer 1x points on rent and mortgage payments.

Option A: 1.5x on all spending.

Option B: 2x on dining, gas, and groceries.

The first card has some appeal. Although I prefer the Venture X for base spending with its 2x points and outstanding consumer protections, Bilt points are way better, so the 1.5x may be just as good or better, especially for those who can’t qualify for the Venture X or afford the annual fee.

Many cards offer better earning rates on dining, gas, and groceries than Option B, so I don’t see the appeal of that card, except for those who cannot afford or are not inclined to carry other more lucrative cards.

Mid-range ($95-fee) cards

These would also both offer 1x points on rent and mortgage payments. The fee would be offset with a $50 credit toward hotel bookings via Bilt, a $60 Walgreens credit, and a $60 credit toward Bilt fitness.

Option A: 5x on hotels booked through Bilt, 2x on dining, gas, and groceries

Option B: 3x on dining, 2x on travel

Option B is essentially the current Bilt card, but with a fee and offsetting credits instead of a no-fee structure. That’s not a huge change, but I prefer the simpler no-fee structure. That is, unless the $95-fee card comes with better protections. The current Bilt card is amazing for a no-fee card, but lacks some premium protections like an extended warranty or luggage delay insurance. With those improvements, this card could easily surge to the top of the crowded $95-fee card field.

Option A suffers from the same problems as option B above.

Premium ($550-fee) cards

These cards both come with a $200 credit toward Bilt hotels, a $60 Walgreens credit, Priority Pass membership, and $120 toward Bilt Fitness.

Option A: 5x on hotels booked through Bilt, 4x on flights booked directly with the airline, 2x on dining, and 1x on rent and mortgage

Option B: 1.25x on rent and mortgage payments, 5x on hotels booked through Bilt, 3x on direct flight bookings, 2x on gas and groceries.

The proposed premium cards are, on the surface, strikingly lackluster. The $290 net fee would be the most expensive in the category. I see nothing to like about Option A, as 4x points on flights is the only bonus category that is competitive, and isn’t as good as the Amex Platinum’s 5x and isn’t dramatically better than the Chase Sapphire Reserve’s 3x.

Option B’s 1.25x earning on rent and mortgage payments might be worthwhile if Bilt allows a higher limit on rent points for this card than the current 100k cap. If a high earner spent 100k on housing and then get 125k Bilt points, that’s at least $312 in extra value that would get closer to justifying the annual cost. But very few people would actually generate that much value. For someone paying $3,000 per month in rent, the extra bonus on rent would only amount to an extra $100-150 worth of points.

What does it mean for Bilt going forward?

Bilt has offered tremendous value for several years now, but as it grows it has to both keep that value high to retain customers while making that value sustainable. It will be interesting to see how it balances those objectives. The hypothetical card offerings they presented addressed annual fees, credits, and bonus points, but left many questions unanswered. Here are some things that could greatly affect the value proposition of Bilt 2.0 cards once they hit the market.

Will there be welcome bonuses?

Bilt has never offered welcome bonuses on its card, and rightfully so—the bonus points on rent are a bonus that keeps on repeating year after year, and can easily outpace traditional welcome bonuses for higher-income users in more expensive housing markets. But progressively better welcome offers has long been a way of differentiating higher-tiered credit cards. Could the $550-fee premium Bilt card really compete with 60k-plus welcome offers on its rivals when the rent benefit is available on Bilt’s own no- and mid-fee cards?

Are changes coming to purchase minimums?

You currently need to make 5 purchases in a month to earn points on rent. Given Jain’s desire to see more people invest deeply in the Bilt-verse and few people taking their rent points and running, this seems like an obvious area for possible change. Could there be new minimums in number of purchases and/or purchase amounts to qualify for rent points, and might those vary depending on the card tier you have?

What about caps on rewards?

In the same vein, might we see changes to the cap on rent points from the current 100k? Having progressively higher points caps might be a way of pushing higher-income consumers into the more premium range of Bilt products.

Will the cards have any effect on Bilt status?

One of the ways Bilt promotes dedication to its ecosystem is its Elite Status tiers. Progressively higher involvement with Bilt comes with benefits, first and foremost extra benefits on Rent Day, like higher transfer bonuses and occasionally incredible benefits like airline elite status. Bilt might funnel users to its premium cards by offering an accelerated path to elite status. Perhaps the mid-tier card would come with Silver status and the premium card could come with Gold. Or maybe the higher-end cards might come with a spending bonus toward status qualification. For example, with a 25% bonus, a cardholder could qualify for Gold after spending $20,000 rather than $25,000.

Will the cards be stackable?

The earning rates on the prospective cards listed above were underwhelming, but might look better if they could be combined. For instance, if Bilt offered the no-fee card earning 1.5 points on base spending, the mid-tier card offering 3x on dining and 2x on travel, and the premium card offering 1.25x on rent and 2x on gas and groceries, you could build a Bilt-universe equivalent of the Chase trifecta.

Will Bilt allow you to hold multiple cards? I would think and hope they would. The minority of the population that are credit card nerds will just take the best bonus categories Bilt has and spend on them, while using other cards with higher bonuses on purchases where Bilt is less competitive. Allowing a trifecta would keep these people in the fold, putting more spending on Bilt cards more often. But whether they will agree remains to be seen.

What kind of perks will the premium card get?

It will be interesting to see how the premium card will compete with cards like the Amex Platinum, Chase Sapphire Reserve, Capital One Venture X, and the incoming Citi Strata Elite. The first three have their own network of proprietary lounges and the Chase and Amex cards also offer access to certain airline lounges. Amex also offers elite status with Marriott and Hilton.

Will the premium Bilt card offer anything comparable? It has offered Hilton status in the past as a Rent Day promotion. Could that be made permanent? With the Sapphire Reserve no longer offering benefits at Priority Pass restaurants, maybe that is an area where Bilt could stand out.

What will happen to Rent Day?

We all love Rent Day, but the promotions have died down a little recently, while Bilt has also capped Rent Day bonus points at 1,000. We certain hope it will survive into the Bilt 2.0 era!

Conclusion

That was a lot of analysis based a survey that proposed a handful of possible card offerings, subject to change, that may be available at some time in the indefinite future. But we love the Bilt card and hope that the next round of changes will allow the company to keep offering the great value it has come to be known for.

In the meantime, the no-fee Bilt Mastercard remains among the best cards on the market and is my personal favorite and a must-have for renters.

If you want one (and you should!), consider using this referral link when you get your own to help us out.