Boost your buying power

Teaming up with a family member or friend can beat the affordability challenge

- NICOLA FIELD

Buying a home is no cheap exercise. It’s tough for couples to muster up a deposit, but for solo buyers high prices can make home ownership little more than a pipe dream.

One solution can be co-buying. Combining forces with a like-minded buyer can boost your purchasing g power. The catch is that it can also be a minefield with plenty of potential pitfalls to ruin a relationship.

We talk to the experts to know what to avoid – and the steps to take – to make co-buying work.

Caylum Merrick, team leader of finance at Perthbased Momentum Wealth, says co-buying arrangements are quite rare. “Most people buy property either by themselves or with their partner. However, given the affordability pressures we are seeing, especially in Sydney and Melbourne, it’s possible we may see rising interest in co-buying.”

Where co-buying does happen, Merrick says it usually involves siblings, or parents and an adult child buying together. “Occasionally you will see friends go into a shared investment, but in this case there is usually a development angle to the purchase.”

David Thurmond, mortgage broker and principal of Mortgage Choice in Melbourne’s Berwick, agrees that co-buying isn’t the norm. “It’s generally not something I encourage with my customers. There are a lot of risks involved,” he says.

That said, Thurmond believes co-buying has a better chance of working where it involves family members because “there is more trust, and both buyers have a stronger alignment to future goals”.