By Louisa Sanghera, Director, Zippy Financial
Ever thought about buying a property with a friend or family member? You are not the only one! The rising cost of property and the fear of missing out (FOMO) has led to more than a quarter of Australians considering buying a property with a ‘non-traditional’ partner.
Most of us long for a place to call our own, but what do you do if the price of your dream home seems to be rising out of reach? More and more young Australians are shedding the “mine” mentality and adopting the “ours” approach in order to get a foot on the property ladder.
According to a 1,000 person, nationwide survey by CommBank, a quarter of home buyers have considered buying a property with their friends, siblings or parents because of increasing concerns about housing affordability. This co-ownership mentality is strongly driven by FOMO, with 35% of respondents admitting to being bitten by the FOMO bug.
What is driving the trend?
In a nutshell: housing affordability with more than 60% of survey respondents worried about being priced out of the market.
Other driving factors for teaming up with a friend or family member include being able to buy a bigger and better property as well as spreading the financial risk if anything goes wrong.
Also, more than 4-in-10 prospective buyers admitted to feeling pressure from friends and colleagues who have already bought or their parents and family who want them to buy.
Co-ownership hurdles and challenges
So, if purchasing a property with family or friends is a viable option, why don’t more people do it? Well, that is because there are several challenges involved.
For example, most respondents said they harboured concerns about putting their relationship with a family member or friend under pressure. Meanwhile, 1-in-10 respondents didn’t even know co-ownership with friends or family was possible. Another hurdle is that co-buying or co-owning can be a more complicated process.
But rest assured, if it is possible and suitable for you, we can help guide you through it, including making sure that all involved parties are across their financial and legal obligations.
Get in touch to explore your co-buying or guarantor options
Co-ownership with friends or family, or having a parent go guarantor for you, isn’t suitable or possible for everyone, but there are people out there for whom it might be a good fit. If you think that could be you, and you want to learn more, then get in touch!
We would be happy to run you through a number of possible structured options and opportunities, as well as the challenges, hurdles and pitfalls you will want to consider. And if co-buying does not look like a good fit for you, we can run through a range of other buying options including federal government schemes that might be more suitable for you.
