Thinking of pooling your resources and teaming up to buy a property? Here’s what you should consider…

In case you hadn’t noticed, the property market moves at an incredible pace. With prices continuing to climb, it’s a pretty tough time to get your first foot on the property ladder.

These days, it takes a solid strategy and a lot of creativity to enter the market. Teaming up with friends or relatives could be the solution you’ve been looking for.

Teaming up isn’t a new concept. It’s been around forever with kids tapping into the ‘Bank of Mum and Dad’ to buy their first house. However, the concept isn’t just limited to family members, and there are some significant pitfalls to be aware of…

Consider creative couplings

Perhaps you and your partner have another couple you want to team up with or a colleague looking for an investment. Two friends could decide to buy together and split the equity. Of course, parents helping their kids buy a property, whether they're loaning or sharing in the investment, will always be a strategy to consider. 

But with property buying already a pretty stressful and emotional process, things can get complicated with multiple parties involved.

Be wary about going in blind

I’ve heard plenty of horror stories from friends and clients who have gone into a real estate transaction without any guidance or a formal agreement in place and have ended up worse for wear. 

One sold off some of his assets and re-mortgaged his property to help his son buy his first home. In theory, his son was going to help him pay off his extra mortgage. Unfortunately, he never saw a cent and didn't hear from his son again!

It’s the perfect example of how money can bring out the worst in people.

Ensure everyone’s on the same page, literally

It should be pretty clear that laying out all of your terms and putting a formal agreement in place (even before starting your search) is the sensible thing to do. And that doesn’t just mean looking at dollars and cents. 

For example, if your parents are helping you buy a home, you need to talk about how involved they’ll be. Will their help be seen as a loan, or do they want to see a return on their investment? Do they get a say in where you buy and the type of property you choose? Even things like how it’s decorated can be a sticking point, so being on the same page from the outset is vital.

Support from an experienced professional is key

Going straight down the legal route may feel like the obvious answer. But working with a Buyer's Agent will also help the process. Having an expert in the middle can help alleviate stress, answer questions and ensure everyone is confidently on the same journey. 

We help you navigate the market and choose properties that fit your brief and make for a sound investment. Everyone with skin in the game will feel that their interests are looked after. We act as an independent mediator between each party and operate as an experienced guide and level head in a highly emotional process.  

If you want to know more about teaming up to buy a property or how a Buyer's Agent can help you safeguard the process, don't hesitate to get in touch.