Co- Ownership: Is it for you?

With the uncertainty surrounding European markets and what the RBA, and big banks for that matter, will do next, it seems property seekers are turning to friends and family to get a foot on the Australian property ladder.

More Australians are now combining funds in order to purchase a property, whether it be with a spouse, friend or family members.

So, would you go down the path of sharing a mortgage with your best mate?

It seems you would…well some of you anyway, in fact truthfully, it’s about a 50/50 split!

Realestate.com asked some of their online followers and the reactions were definitely mixed.

There were many who gave a flat out ‘No, never’, some who had already signed up to a co-ownership agreement and others who said they would ‘definitely consider it’.

Paul indicated co-ownership of a property was not for him.

“People’s life situations change at short notice causing selling when it’s not the right timing,’’ he wrote.

Trace had a different view.

“I bought a house with my best mate years ago – must have been good because now we are married!’’

Western Australia’s Centrewest Insurance Company took the cautious approach.

“Situations can change drastically from when you decide it’s a good idea to a couple of years down the line, so always a good idea to draw up a legal document just in case,’’ they explained.

HQF Lawyers shared Centrewest’s sentiments.

“It can be the only option for some, but before doing so both friends should discuss with each other their short, medium and long term goals in respect to the property. Putting in place an agreement setting out what is to happen if one owner wishes to sell and the other doesn’t should also be considered.’’

Joely believes it is the best thing he’s ever done.

‘’We agreed on an exit plan and set up a joint account that we contributed to evenly each fortnight to cover all and any issues that arose. Sold it 7 years later for more than double the purchase price and allowed me to invest in my own property.’’

We couldn’t help but acknowledge David’s approach to co-ownership as one of the best…

“My wife and I bought a property together with her Dad and then built a Grandpa flat (actually a small house!) out the back. Fantastic setup. Got us into our own home and free babysitting and lawnmowing!!!’’

Hope this has shed some light on your property purchasing options. If you need any advice give us a call on 4965 7299.