Buying with family and friends is the new normal

BUYING with a friend or relative is paving the way to home ownership for a growing numbers of singles who are priced out of the market as solo purchasers.

A national survey by ME Bank of 1000 people found 13.9 per cent of respondents bought a property with their parents and 30.4 per cent would consider doing so.

Another 12.2 per cent had bought with other family members and 34.6 per cent said they would consider this.

The survey found buying with friends was a less popular tactic, with 4.3 per cent of respondents going down this path and 15.3 per cent happy to consider it.

When Darany Maokhamphiou, 31, began to look for a place to buy, she quickly realised she would not be able to pay for it on her own. So the customer service officer teamed up with her younger sister, Annie.

For the past year, they have owned a two-bedroom apartment in Yarraville.

“It was just impossible to buy by myself and to get a mortgage,” Ms Maokhamphiou said. “And it was the same for my sister.”

Ms Maokhamphiou said going into home ownership with her sister was an easier option than it would have been with a friend.

“Because Annie is my sister I wasn’t scared of investing with her,” she said. “If you have that close relationship with your sister, then it is much easier than investing with a friend or a partner.”

Ms Maokhamphiou said she and her travel agent sister did not want to purchase too far from the city. Buying together helped them get a foothold in their desired suburb.

“The inner western suburbs were the most affordable and still close to family,” she said.

ME Bank general manager Luke Easton said “joint buyers” was an emerging trend that was likely to become more popular.

“For some younger first homebuyers, it is difficult to get into the area they want to live,” Mr Easton said.

“Pooling the resources helps them enable that.”

A 2013 Mortgage Choice First Time Owner survey showed just 24.4 per cent of first-time buyers purchased their property alone, compared with 29.81 per cent five years ago.

A further 67.5 per cent bought with a partner or spouse, while 3.8 per cent bought with a sibling.

Five years ago, just 1.79 per cent bought their first property with a brother or sister.

Mortgage Choice head of corporate affairs Jessica Darnbrough said more people were open to the idea of buying with family and friends because it was getting harder to get on the property ladder.

To meet this trend, banks have even come up with loans specifically for joint purchasers.

Commonwealth Bank home loans general manager Clive van Horen said his bank’s Property Share home loan allowed borrowers to co-own a property with friends or family, while retaining individual control of their finances.

In 2006, business consultant Helga Svendsen teamed up with a friend to buy a three-bedroom house in Northcote.

“We had a legal agreement drawn between us which outlined all the circumstances that we could think of that might become a problem,” Ms Svendsen said.

“People buy houses with partners without putting this much thought into it,” she said.

“And they never think how it would separate because they never think about separating with their partners,” she said.

“We could think about separating our property but maintaining the relationship, which made it easier to navigate through the ownership and living together.”

Ms Svendsen, who has since bought out her friend’s share in the property, said she would highly recommend buying jointly.

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