Going halves in investment property with a friend

[Brits]

Hello
A friend of mine and I are thinking about going halves in an investment property.
I am not in a position to buy the house 100% myself and neither is he.
We got very excited about it yesterday and then last night I realised it might not be a good idea.
We are not 'involved' together and never will be. He is very reliable and so am I however I was wondering has anyone ever done this? What could go wrong?
I'm sure I have not thought this out completely.
Any advice most welcome.
Thanks
Marie

 

[TMNT]

my piece of sexist advice,

I think investing with friends/family etc, there is always more risk then two complete strangers

I also think there is more risk if its a man and woman (of comparable age)

I also think its more of a risk for the man if this is the case,

 

[wylie]

my piece of sexist advice,

I think investing with friends/family etc, there is always more risk then two complete strangers

I also think there is more risk if its a man and woman (of comparable age)

I also think its more of a risk for the man if this is the case,

Why do you think it is more of a risk for the man?

I think it is a risk for both of you insofar as the probability that one of you will meet someone and want or need the money invested to put towards a family home.

I did this very early (around age 20) with my brother and my father. My brother then got engaged and wanted his money out, and we had no option but to sell up without having held the property long enough to make any money (except forced savings).

 

[macca446]

Hi,
Buying a investment is long term and although this is a friend so many things can happen over time such as you have a falling out at anytime,arguments over the investment which once friendship is broken then the investment will come into play,such as he wants his half back and depends your buy in price to sell time you can lose money,please by all means just look at all the possibilities before entering into a contract like this and this is only my opinion
Macca446

 

[TMNT]

Why do you think it is more of a risk for the man?

I think it is a risk for both of you insofar as the probability that one of you will meet someone and want or need the money invested to put towards a family home.

I did this very early (around age 20) with my brother and my father. My brother then got engaged and wanted his money out, and we had no option but to sell up without having held the property long enough to make any money (except forced savings).

I find that when it comes to financial responsibilities women seem to feel less obliged when all hell turns to hell, and if they get divroced they get the bigge rchunk of the pie , and hence when things go sour, they subconsciously expect more then what i feel they deserve

I know its sexist but just my opinion

 

[wylie]

I know its sexist but just my opinion

That is the truth... it is just your opinion.

 

[Terry_w]

What could go wrong?

1. Death
2. Family Law
3. Bankruptcy
4. Incapacity
5. Being liable for whole debt

are the main ones

But also
6. disputes
including
- who does what
- who pays for what
- one wants to sell when the other doesn't
- accessing equity
etc

Imagine in 5 years his girlfriend slaps a caveat on title just after he has been in a car accident with his uncle being the attorney and wanting to sell - you don't have the abiity to buy out but will incoveniently he up for a large CPT bill if you do sell. He then dies, probate takes 8 months and then the caveat issue is still hanging around...

 

[moridog]

. Brits, I did this with a friend, there is another thread in investor psychology. I will not comment on the female/male angle, that is simply irrelevant. People enter into and need to exit, all sorts of arrangements all of the time. My friend and I bought an investment property three years ago, we used my PPOR for the loan, he had a good wage but no no assets, I really wanted to get into the investment market but had little serviceability.
Ultimately, I moved in, and pay him half the rent it would fetch on the market. The house has appreciated steadily, we have not had the slightest issue, really, about anything. I realise this a bit of a dream run, but, if you trust one another and have similar goals that you can not achieve alone, go for it.

 

[Brits]

Thanks everyone. I'm thinking it's probably not such a good idea.
I have three investment properties and he has none. He will eventually find a woman to live and share with etc and undoubtedly he will want to buy with her and get out of it before I will.
We are at different points in our lives so that makes it risky I guess.
I think perhaps I was being somewhat greedy wanting to buy again when I really am not able to.
I do like being totally independent of anyone else when it comes to what I do with my properties. I believe in this guy but once someone else gets involved like a new woman I could find myself up S#%t Creek.

 

[Corey Batt]

Thanks everyone. I'm thinking it's probably not such a good idea.
I have three investment properties and he has none. He will eventually find a woman to live and share with etc and undoubtedly he will want to buy with her and get out of it before I will.
We are at different points in our lives so that makes it risky I guess.
I think perhaps I was being somewhat greedy wanting to buy again when I really am not able to.
I do like being totally independent of anyone else when it comes to what I do with my properties. I believe in this guy but once someone else gets involved like a new woman I could find myself up S#%t Creek.

Definitely sounds like a rational decision. Everyone runs their lives differently, and their needs change at different times. The last thing you'd want to do is investment in a property, only having to sell out of it before making a solid return.

Your current situation seems to be dictated by a lack of serviceability, is this based on a banks servicing, or brokers? I've come across many a person who believed they were 'tapped out' only to find out that their particular lender they've been using for years was turning off the supply, whilst there was a line of other banks willing to lend for their needs.