Let’s face it, despite economic issues, global pandemics, and even unjust wars, the price of houses in Australia continues to rise. That’s great for people selling and the real estate agent Campbelltown looking after them.
But, it doesn’t help the younger generation achieve the Australian dream. The average age to buy a first home is now 40 and it’s getting more and more difficult for people to believe they will ever own their own property.
This, and environmental concerns have been one of the main reasons tiny houses have grown in popularity. But, there is another option that many people may not be aware of, co-ownership.
What is co-ownership?
Co-ownership is exactly what the name suggests when ownership of a house is split between two or more parties. It isn’t just popular with first-time buyers, many people looking for a luxury home are turning to co-ownership.
The premise is simpler, you pay for part of the home, usually half. This allows you to pay a deposit and get a mortgage while living in a house that you shouldn’t be able to afford.
The other half of the house is owned by a third party who charges you rent. As long as you pay the rent you can live in the house as though it’s yours. There is often an option to buy out the other party later on.
In general, the house bills will be paid by you as you live there. Regular maintenance bills are shared but only those that are directly linked to the property.
Why it’s a good investment
There are several reasons why you should consider co-ownership.
Use of the property
If you co-own with a finance or housebuilding business then the house is for your use only. That means you can treat it like a house you own completely. The result is you live in a property that you shouldn’t be able to afford and can enjoy every aspect of it.
Long term savings
It may sound surprising but, in the long term, co-ownership can save you money. Because you will already be living in a luxury home you won’t be interested in moving. That saves you the costs and hassle of moving. Ultimately, you’ll be able to purchase the rest of the property. While this does involve paying back a mortgage for many years, you’ll be much better of as the value of the house becomes part of your estate.
If you are in a co-ownership house, you’ll find it easy to rent when you’re not there. In most cases your co-ownership firm will handle everything, allowing you to earn money when you’re not at your home.
It’s a great way to improve your finances further and even improve the chances of buying the rest of the property early.
If not, you can always keep half the property, buy yourself another place, and enjoy collecting half the rent from a tenant. That can be a lucrative deal.