Has anyone ever co-bought a house?

[cpals]

My friend and I who I've known a long time have talked in the past about renting a place together when we move out. Recently he has purchased a plot of land for a good price and asked me if I wanted to split the cost with him. The house would be more of an investment because neither of us really have plans to live there for more than a couple years together since one of us might be married in that time. We have about equal income and get along pretty well. One person would get one half of the house and the other would get the other. We both don't really mind who gets the master since the other would get the two smaller rooms.

Has anyone done this or have experience with it?

Thanks.

 

[NightCrawler]

Two gay guys buying a home, seriously this is a bad idea. If your young and unmarried then I suggest waiting til you find a wife.

 

[Bateluer]

Co-buying, good way to split the costs. But VERY risky, but I guess if you built a duplex house, it'd have a higher chance of success.

 

[cpals]

Originally posted by: NightCrawler
Two gay guys buying a home, seriously this is a bad idea. If your young and unmarried then I suggest waiting til you find a wife.

Yeah... isn't it past your bedtime? Guys have roomates all the time and this would be a good investment since the homes in my area are skyrocketing. I cannot afford to own a house by myself and would rather not rent.

 

[Wallydraigle]

OMG, my head hurts just thinking about doing that.

 

[nageov3t]

seems like an ok idea, as long as you guys sign a contract beforehand.

 

[NightCrawler]

Originally posted by: cpals

Originally posted by: NightCrawler
Two gay guys buying a home, seriously this is a bad idea. If your young and unmarried then I suggest waiting til you find a wife.

Yeah... isn't it past your bedtime? Guys have roomates all the time and this would be a good investment since the homes in my area are skyrocketing. I cannot afford to own a house by myself and would rather not rent.

Senario:

1. Two guys buy a home to split the cost.

2. One of the guys meets a nice woman and decides it's time to marry and buy a home together, he wants his friend to buy his share out. The problem is the guy can't afford to buy it out and is resentful the friend is leaving him high and dry.

3. Shots fired

4. Heaven has nice condos and the women all sunbath naked or Hell has barbeques unfortunately your the hotdog.

 

[cpals]

There would be a legal contract written up just to cover all the bases... the other one could either buy out or we would sell the home and split the profits. It's an investment and neither of us consider we will be staying there for more than 3 or so years. We both have been with our girlfriends a long time and if one of us did get married we could move into the house or sell it.

 

[cmv]

Originally posted by: cpals
There would be a legal contract written up just to cover all the bases... the other one could either buy out or we would sell the home and split the profits. It's an investment and neither of us consider we will be staying there for more than 3 or so years. We both have been with our girlfriends a long time and if one of us did get married we could move into the house or sell it.

Do you have enough $$$/credit to buy him out and vice versa? If so, go for it. It sounds like he is a close friend but I wonder if you have some doubt by your posting here. If you have any doubts, just pass it up.

 

[cpals]

No, I'm pretty gung ho for it... just wanted to know if anyone has done it before so I can cover all the bases that should be covered. If I ever did get married and he wanted to sell, the combination of both incomes could buy him out.

 

[mugs]

My brother bought a condo with one of his friends. The friend made the down payment, my brother makes the monthly payments. It sounds like in your situation it would be a simpler, because you're splitting everything down the middle. I don't think my brother and his friend are smart enough to figure out who owns how much of the condo when they sell it.

Definitely get a lawyer to write up a contract though.

 

[chowmein]

my name is on my aunt's house, does that count

 

[Evadman]

One person should buy the house, the other rent from the first. Anything else is just asking for trouble.

 

[vi edit]

Originally posted by: Evadman
One person should buy the house, the other rent from the first. Anything else is just asking for trouble.

That's kinda what I was thinking. I've known a couple people that did this and *so far* there haven't been any problems (assuming one person alone can get pre-approved).

 

[Beau]

I bought my current house with my best friend. It's been an okay arrangement, and a good investment, but I definitely would recommend making an agreement IN WRITING between the two of you stating exactly what eachother is responsible for and exactly how much of what goes to whom -- just in case sharing a financial obligation sours your friendship.

 

[cpals]

Definitely... everything would be in writing. The house would be split 50/50 so there wouldn't be any problems figuring out how much goes to who and stuff... If say I rent from him, I don't create any credit rating for myself as I would if we split the house, right?

 

[FlyLice]

Contract, CYA, Contract, CYA CYA CYA!!!!!!!!!11

 

[spidey07]

bad idea, nothing good can come from it.

nothing.

 

[everman]

Definitly have an attorney write up a contract if you go through with it. That way the worst thing that happens is you are forced to sell the house and split the cash. You also need to go over any liabilities that may come up.

 

[spidey07]

Originally posted by: cpals
There would be a legal contract written up just to cover all the bases... the other one could either buy out or we would sell the home and split the profits. It's an investment and neither of us consider we will be staying there for more than 3 or so years. We both have been with our girlfriends a long time and if one of us did get married we could move into the house or sell it.

gee, novel solution - marry your girlfriend and start your life.

There are so many things that will go wrong with your plan it is unfathomable.

 

[spidey07]

Originally posted by: everman
Definitly have an attorney write up a contract if you go through with it. That way the worst thing that happens is you are forced to sell the house and split the cash. You also need to go over any liabilities that may come up.

problem is the emotional attachment to a home. one will want to keep it, the other will want to get out. One will get screwed financially no matter what the outcome.

 

[DainBramaged]

Don't do it. You are asking for trouble in the form of relationship problems with your friend and unneeded stress.

 

[rahvin]

Originally posted by: cpals
Definitely... everything would be in writing. The house would be split 50/50 so there wouldn't be any problems figuring out how much goes to who and stuff... If say I rent from him, I don't create any credit rating for myself as I would if we split the house, right?

Just remember when you own property things can happen. Things like furnaces or water heaters going bad or the house catching fire. Who is responsible for repairs? Is one of you going to try to fix it themselves and the other wants to hire someone? What about survivership? In addition what happens if the housing market sours and you end up losing money if you sell the place? What happens if one of you becomes unemployed or has to move away?

 

[1sikbITCH]

Make damn sure you write up the deed with some conditions.

If he owns half and you own half, what's to stop him from selling his half to someone else? Then suddenly you have a new roommate. Maybe that roommate is a freakshow.

What if he gets married, and keeps his half? Then his evil wife divorces him and takes it, and then shows up at your door with the 3 kids and new boyfriend, demanding keys and the big bedroom?

You have to both protect yourselves from that stuff.

 

[dullard]

I didn't see this thread earlier (I don't post on weekends). I would be a little cautious doing this if I were you. A few things caught my eye that I'd like to highlight.

[*]It appears that you haven't lived with this friend yet. It can work out quite well to live with a good friend, but I bet in the majority of cases, it won't. I can't think of a single person I knew in college who moved in with a best friend, and who didn't hate each other at the end. But those people who moved in with a complete stranger had a great time and a new friend at the end. Often you enjoy being with your friend but not spending 100% of your time with him. I would personally try renting a place for a few months with him (sometimes in college towns you can get a 3 month lease) before diving into a major committment like a home.

[*]Buying a home comes with upfront costs. Minimally you'll need to pay for the title inspection (~$500), bank fees (~$500ish), termite inspection ($100), and other fees which depend on house price (say 1%-1.5% total). When it is all said and done, you can often have $3-5k worth of closing costs for an inexpensive house. Then you have house maintenance, property taxes, house insurance, etc to consider. But you do save on rent and you can get a potential tax deduction. In order for the savings to overcome the expenses, you have to live there for a while. A rule of thumb is 5 years. If you spend less than 5 years in a house, you often lose money. You said you wanted to "live there...a couple years". The end result is that for such a short time period, you very well may lose money when compared to renting an equivalent house. Of course if housing prices skyrocket this might not be true. But likely it will be.

[*]You mentioned in your other thread a lot of problems. Banks won't like this. You are at a new job with high credit card debt. That screams high interest rate mortage (if you can get one at all).

If you really want to do this, I'd suggest following Evadman's advice. Have your friend buy it, and sign a legal contract where you rent from him. If you want to share a part of the costs and potential profits of the house, build that into your rent agreement, or sign a seperate agreement.