Today's rising rents have prompted many a renter to contemplate the prospect of buying a property and putting their rent money into a mortgage instead, but the high price of buying real estate is often impossible for the solo buyer. So what to do? Some homeowner hopefuls enter into buy-sharing arrangements, where they split the property purchase with a friend or family member.
Co-owning a home can make an otherwise impossible dream a reality, but you and your co-buyer have to be prepared to continuously communicate with each other on a number of different levels. Here are just a few points to start the conversation:
- Is the home purchase being split 50/50, with all expenses divided evenly between the two of you?
- Are just one, or both of you going live in the home, or is to be just an investment property?
- Are you looking for a move-in-ready property, or a fixer-upper?
- If you buy a property that needs work, is this something you will do yourselves or will you hire tradespeople? Do you have the skills, time and budget to renovate?
Your first priority should be to secure independent legal advice. While you and your buddy get along and share the same dreams now, never lose sight of the fact that buying a home together is a long-term business deal, subject to legal obligations and responsibilities. Once you confirm your co-ownership agreement and sign the necessary paperwork, then you'll be ready to move forward!
From The Shamez Virani/Virani Team August 2016 Newsletter - Courtesy of Market Connections Inc.