It can be hard to raise the money to buy a property if you don’t have a spouse or partner to boost your borrowing power with a second income.
Not only do deposits take a long time to stow away in the current low interest rate environment, but there is stamp duty and other fees to take into account.
Not to mention the fact that in a number of markets, property prices are on the rise.
One option to get on the ladder is to joint buy with a friend, or family member.
Of course, if you’re anything like me, going into business with a family member and most friends is not exactly a welcome proposition, so a well-selected business partner with a similar interest might be a better choice.
You might be able to source these through a buyers’ agent or looking at online property forums. Buying a property now may mean selling in five years with enough equity to part ways and to each buy your own home.
Or, you might hold the property as a long term investment and use that equity to build a bigger portfolio.
Whatever the reason, it’s important you get all the terms of agreement down in writing, to avoid any legal difficulties later on.
Having everything split down the middle, or however else you desire it and clearly defined according to the law will ensure your interests are looked after.
You also need to look after your serviceability in the future and it’s important to realise that in this age of cautious lending, which is only likely to become stricter as time passes, there are many things that you don’t know about which could affect your financial status in the future.
One example is that your partner in a purchase can directly affect your own credit rating.
This means that when joint purchasing it is vital that you set up separate loans for each buyer, so that if your partner struggles to make payments, or defaults on the loan, it won’t affect your borrowing capacity or credit record.
Tim McIntyre is the senior real estate reporter for the Daily Telegraph and News.com.au.
Over the past decade, he has attained widespread knowledge of Australia’s many unique property markets and is an authority on all things buying, selling and investing.
His commentary appears every Saturday in the Daily Telegraph Real Estate lift out, as well as online at news.com.au