Wednesday, April 25, 2012
The NAEA offers top tips for buying a home with friends
Would-be first time buyers struggling to raise large deposits or
secure finance from reluctant banks could consider buying with
family or friends as a potential solution to help spread the costs
of buying and maintaining a home.
But with a house likely to be the biggest purchase of a
lifetime, it is important for anyone considering a joint ownership
arrangement to get it right from the start, according to the
National Association of Estate Agents (NAEA).
Wendy Evans-Scott, President of the NAEA, said: "Despite a
slight increase in the provision of mortgage finance, many first
time buyers are still struggling to get on the housing ladder. This
problem has been exacerbated by the Government's refusal to extend
the stamp duty holiday for properties under £250,000 in
particular.
"Splitting the cost of a substantial deposit, maintenance and
mortgage repayments could make owning a home a more realistic aim
for many would-be first time buyers. I would, however, advise
anyone looking to enter into joint ownership that a transparent
relationship between all parties is imperative if the process is to
go smoothly. That is a vital step whether you are buying with
family, friends or another third party."
To aid buyers, NAEA recommends the
following:
Consider your mortgage options -There are mortgages that exist
specifically for this type of purchase, so shop around for the best
deal. Remember that, with a combined income, it may be possible to
attain a mortgage of higher value, giving you greater choice of
properties
Think about the worst case scenario-One of the benefits of
buying with friends or family should be a high level of trust, but
that shouldn't be to the detriment of legalities. Consult lawyers
about a legally binding co-ownership contract and agree in advance
what will happen if one owner's circumstances change
Keep paperwork in order-Remember, this is a business
transaction, and any paperwork relating to the property or mortgage
must be in the names of the co-buyers. Ensure copies are made of
all documents associated with the purchase to allow them to be
readily accessible to both parties
Don't forget who owns the TV -Drawing up a comprehensive
inventory of non-shared items or other costs, and keeping a note of
who pays for things like paint, at the start of the shared
ownership can reduce confusion months or years down the line. This
should also help if one party decides to move out
Set a realistic timeframe-If you are buying with a friend it is
likely that the relationship is, ultimately, temporary. For this
reason, co-ownership should always be treated as an investment
decision and buying a house with a good potential resale value
makes sound business sense
ENDS
Editor Notes:
About the NAEA
The National Association of Estate Agents (NAEA) is the UK's
leading professional body for estate agency personnel, being part
of a group representing 13,000 members who practice across all
aspects of property services both in the UK and overseas. These
include residential and commercial sales and lettings, property
management, business transfer, auctioneering and land. The NAEA is
a sister organisation to the Association of Residential Letting
Agents (ARLA), as is
PropertyLive.co.uk, the UK's only regulated property
portal.
The NAEA is dedicated to the goal of professionalism within all
aspects of property, estate agency and land. Its aim is to reassure
the general public that by appointing an NAEA member to represent
them they will receive in return the highest level of integrity and
service for all property matters. Both NAEA and ARLA members are
bound by a vigorously enforced Code of Practice and adhere to
professional Rules of Conduct. Failure to do so can result in heavy
financial penalties and possible expulsion from the
Associations.
For further information contact:
NAEA PRESS OFFICE
Tel: 020 3128 8181
E-mail: press@nfoppmedia.com