For many first time buyers, purchasing a home has simply become unaffordable. In order to make the process cheaper and to prevent renting, many people have recently started buying properties with their friends. But, is this a good idea? In this post, we take a look at the positives and negatives of this new trend.
Positives of Moving in With Friends
Moving in with your friends is undoubtedly a great way to lower your expenditure when you’re moving home since you can all save for the deposit and split the bills together. If you’re planning to buy a property and then rent it out, it’s also an excellent idea as it helps you lower your investment/risk.
In addition, not only will you not have to spend as much on a mortgage, but you should be able to save a higher deposit amount between you and your friends much sooner. This way, you can lower your monthly repayments.
Finally, as long as you choose your friends wisely, as advised in this House Network blog, you’ll have great company and sensible living arrangements. As long as you’re all invested in the process, then you really should have very few problems with your new venture.
Negatives of Moving in With Friends
However, in stating the above, choosing the wrong friends can prove problematic to say the least. This is why it’s important to not rush into choosing the friends you’re going to live with. Make sure that you’re all long-term friends and that everyone is friends with each other, rather than belonging to individual friend clusters.
In addition, it should also be noted that only four people can legally own a property and the land it sits on, with anyone under the age of 18 also banned entirely. As a result of this, if a number of you are buying the property, you’ll have to closely consider whose names will be on the deeds to the house.
Finally, think about the long term impacts of your move. After all, a house is a long term investment, so you’ll have to be certain that all of you are planning on staying there for a very long time. After all, a mortgage is generally around 25 years, so there’s little chance of moving too soon.
To conclude, moving in with friends can be a great move if you’re looking to buy a new property more cheaply. However, there are still certain considerations to make. Choose your new housemates carefully and ensure you’re all fully committed.
My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.