Zillow® recently released its list of five housing market predictions for 2023 and there was one that I found particularly interesting. With rising interest rates and high home prices, home buyers are finding creative ways to make mortgage payments and one of these ways is to team up with friends and family to purchase a home.
A Zillow® survey found that 18% of successful home buyers purchased with a friend or relative who wasn’t a spouse or partner. Buying a home with someone else can have many benefits. To start, it can make home ownership much more affordable. You will be splitting the down payment, mortgage payment, and the costs of upkeep. Buying a home with someone else can also help boost your debt-to-income ratio. This is one of the main qualifying factors for a home loan.
Make Sure You Have the Right Partners
If this option of buying a home sounds like a good idea to you, we suggest consulting an attorney before making such a big purchase with someone else. It is also important to work with a good real estate agent who can help you navigate any zoning issues or restrictions on how the home can be used.
What Type of Home Should You Buy With a Friend?
Before you purchase a home with a friend or family member, you need to think about how you want to live in the home. Do you want it to be like a roommate situation where you share common spaces such as the kitchen and living room? Do you want completely separate units? Do you want a duplex? In addition to the type of home you are going to buy, you need to discuss how you are going to split the payments. Are they going to be based on room size, split down the middle, etc? Lastly, you need to have a plan of what will happen if someone wants to move out. Will one of you have the opportunity to buy the other one out? These are some of the big things you need to keep in mind and discuss before purchasing a home with someone who is not your spouse.
Ready to Start Your Home Search?
Whether you are purchasing a home with a friend, family member, significant other, spouse, or on your own, I will be here to help you every step of the way! Contact me today at 919-961-3277 or Annie@HudsonResidential.com.