Aussie Home Loans boss John Symond is urging first-home buyers to consider buying with friends or family, rather than miss out on a good opportunity.
In a blog post, Symond says co-ownership allows buyers to get a foot on the property ladder by combining their borrowing power and splitting the cost of buying property.
Symond says timing is everything when it comes to making a purchase and believes it can be a better idea to buy with someone else than to not buy at all.
“If you see an opportunity where prices have come off, it may be a good idea to buy with a friend or relative if you can’t afford to buy yourself,” he says.
“But you really do need professional advice to do this.”
Symond points out that buying under a co-ownership agreement means you can split all the fees that come with buying a home including stamp duty, legal costs and inspections.
And, he says, there is a good chance you’ll be able to reduce the length of the mortgage and own your half of the property faster.
Symond says improved housing affordability, stable property prices and low interest rates have made shared property purchases more uncommon in recent times, there are still plenty of people who are opting to co-own.
Symond highlights the many things to consider if you are serious about co-ownership.
“Get advice with structuring the purchase. What happens if your friend or relative changes their mind somewhere down the line? What happens if one of you wants to keep the property and one wants to sell? Or if one wants to rent and the other wants to move in?
“There are a lot of scenarios to consider and you really do need to tick all the boxes.”
PodProperty, which specialises in shared buying of property, recommends that buyers enter into a legally- binding co-ownership agreement.
This is a contract between parties who own property together as "tenants in common".
“It can cover many different types of relationships, including groups of friends, family members, defacto partners (either heterosexual or same-sex) or any combination of these types of relationships,” says PodProperty.
PodProperty charges $350 to write a co-ownership agreement and also offers a free guide to co-ownership on its website.