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While home ownership appears increasingly elusive for many, co-ownership is helping a good number of Aussies realise their quintessential Aussie dream.
Co-ownership essentially means that a single piece of property is owned collectively by two or more individuals. It’s a lifeline for those who find it challenging to make a solo entrance into the real estate market, enabling them to combine resources with like-minded folks and step onto that elusive property rung.
The trend is gaining traction among various demographics:
Before you go rifling through your phone’s contact list, there are some key considerations.
In Australia, there are two primary types of property ownership:
While joint tenancy is the go-to for couples, it might not be ideal for co-ownership scenarios. Be sure to understand these classifications when you’re sorting your finances and making the purchase.
You and your friend might be keen about co-owning a property, but life is unpredictable. What happens if one wants to sell but the other disagrees? Or what if unexpected, costly repairs pop up? How about in cases of job loss, insolvency, or demise?
Disputes among co-owners can lead to legal battles, a hassle that could be side-stepped with a well-drafted Co-Ownership Agreement. Consulting a solicitor or property conveyancer before making any decisions is imperative.
You’ll likely chat about your contributions towards the down payment, loan repayments, insurance, and local council rates. But what’s the plan for utilities and internet? Considering a common bank account or a kitty for repairs? Will there be a division of groceries and living spaces?
Dual-occupancy properties could answer some of these questions. However, a comprehensive Co-Ownership Agreement is essential to lay down rules and avoid misunderstandings.
Up until now, we’ve delved into the nitty-gritty, but let’s switch gears and ponder the perks:
And hey, you might even become eligible for a government first-home-buyer package!
Though the prospect is enticing, remember the old adage about the peril of mixing money and mates. Like any financial undertaking, risks can be alleviated through sage advice and prudent choices. Consulting with legal professionals is non-negotiable for clearing up any uncertainties.
So, do you think your best friend could be your ticket to that Great Australian Dream?
The information contained on this website has been provided as general advice only. The contents have been prepared without taking account of your personal objectives, financial situation or needs. You should, before you make any decision regarding any information, strategies or products mentioned on this website, consult your own financial adviser to consider whether that is appropriate having regard to your own objectives, financial situation and needs.