Gaining a foothold on the property ladder is becoming harder and harder for more and more people. The cost of housing sufferers who receive the most attention are the young looking to buy their first house plus the essential workers (nurses, teachers, emergency services personnel) who cannot afford to live near to the places they work, particularly in the South of England. But what of the recently divorced, separated or widowed? What of the asset rich but cash poor elderly? What of the expatriate returning to the UK after an extended time overseas? Could buying a house with a stranger provide all of these groups with a viable alternative to taking out 100% mortgages or continuing to muddle along in the rent trap? Angela Roberts, founder of the co-buying property network You to Share believes that co-buying, also known as joint ownership, can indeed solve many of the current home ownership issues. Co-buying can provide a variety of would-be home owners with a safe and seamless first step onto the property ladder, says Roberts. Finding people to co-buy with might have been a problem in the past but sites such as www.youtoshare.co.uk provide access to a host of useful services in addition to contact details of others looking to share the cost of home ownership. In a nutshell co-buying involves up to four people dividing the cost of a mortgage. Like renting each person must take responsibility for a share of the costs associated with the property but unlike renting each co-buyer is investing in the property. Many banks, building societies and other mortgage lenders are comfortable working with a four way mortgage and as long as a Deed of Trust is signed by each co-buyer then all eventualities, including a get out clause, will be covered. So, returning to our cost of housing sufferers listed above how could co-buying benefit each of these very different kinds of people: Young First Time Buyers Having saved for a deposit, either individually or with assistance from their parents, many young people will realise that the house of their dreams is still a fantasy as house prices continue to rise every few months. Two or three young people could combine their deposits to co-buy a larger property and then manage the mortgage and other household costs between them. After a few years they will each be able to move on to purchase their own properties having made a profit (equity share) on their initial co-buying investment. Essential/Key Workers Since those entering the world of nursing, teaching, policing, emergency services or social work do not receive the highest of salaries, co-buying may provide the property access solution. Two junior nurses or two junior fire fighters could co-buy a property in an area close to their place of work. Divorce/Separation Many people find that coming out of a long term relationship can not only cause tremendous emotional problems but also means that one of the partners becomes a first time buyer all over again. Co-buying following a relationship breakdown can mean being able to afford a property close enough to be able to be available to assist with child care plus, by using a co-buyer network such as You to Share, meeting others in a similar situation could lead to a support network. Widowed Losing a long time partner can often be the trigger people need to decide to move house possibly to something smaller or perhaps to a new area, closer to family for example. Co-buying a property has numerous benefits for this group of people including releasing equity from their previous property so they can enjoy themselves and of course having someone to share the property with. Asset Rich but Cash Poor There are a growing number of elderly people investigating various equity release plans as their houses increase in value yet they do not have access to the cash needed to paint/maintain the said property. A new equity release option, presented by You to Share, involves children or indeed grandchildren co-buying a portion of their parents/grandparents house and so providing immediate capital release to the home owner plus a means of investment for the relatives. An added benefit of this element is a reduction in the full impact of Inheritance Tax. Expatriates Since co-buying networks are mostly internet based, expatriates may be able to invest in property with a co-buyer prior to returning to the UK. This investment could be made over a number of years or perhaps closer to the expatriates return. Services such as You to Share provide ample opportunity for potential co-buyers to specify their needs and wishes so expats could explain that eventually they will want to live in the property they are co-buying. With so many people unable to access the property market Angela Roberts believes that co-buying could be the way forward. With any kind of partnership there are compromises that have to be made. The security provided by a Deed of Trust and other legal documents, which are free when co-buyers use the You to Share conveyancing provider, ensure that all parties are protected and can feel secure in their investment. Further information on co-buying can be obtained from http://www.youtoshare.co.uk |
