Even with today’s very affordable mortgage rates, the real
estate market can still present a challenge to many people wanting to step onto
the property ladder. First-time buyers
in particular are finding they have to make adjustments as they plan for their
dream of home ownership. Some young
people are staying at home longer in order to save for a down payment. Other would-be homebuyers are scaling down
their expectations, while still others are choosing a home with a rental unit
to help with mortgage payments.
There are some other creative alternatives available to help
First Time Buyers start to build some equity in the real estate market that
entail multiple ownership of the same property.
One option that may be of interest to family groups or close friends is
the joint purchase of a multiple-unit dwelling, such as a duplex. Such a property might be jointly purchased by
two groups of buyers, with each family occupying one of the property’s
units.
The duplex approach can work well in situations where young
people plan to marry, leaving their parents as “empty nesters”. In this scenario, the family home is sold,
with the parents buying one unit of a new duplex outright, and then banking
their surplus funds, perhaps for retirement.
The younger generation then assumes the more manageable mortgage
payments on the remaining half of the property.
In this way, they can start to build equity immediately, without having
to come up with a large down payment, or taking on a big mortgage.
In less formal arrangements, two couples may elect to
jointly buy one single-family residence and share all the living space. This
can sometimes be a stressful situation, and the best chance for success is
usually when there is a family relationship between the two couples, such two
siblings with their spouses, where there is already some history of living
together in a shared space.
In addition to the terms of ownership, the ongoing care of
the property should also be considered.
Who will be responsible for the ongoing maintenance of the
property? What services such as
landscaping or snow removal will be contracted out to service providers, and
how will this cost be shared? How will the cost of major repairs be
handled?
As you can see there are a lot of variables to
consider. Such important issues should
not be left to chance. Don’t expect that
they’ll be sorted out easily when the time comes. The best course of action is
to get a lawyer involved and draw up an agreement that clearly sets out the
rights and obligations of all co-owners.
Remember, when you’re thinking of creative ways to ease the
cost of owning a home, talk it over first with the expert. Tell your real estate salesperson all about
your plans, so they can ensure that you are shown homes that conform to the
appropriate zoning and municipal by-laws.
Best of all, your Coldwell Banker
real estate salesperson may be able to suggest options that you’d never
considered, and help you make your home ownership dream a reality.
Contact me today for a Free Homebuyer's Toolkit!
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