The idea of buying a property with a family member or friend seems attractive at first glance; the subject frequently fuels numerous discussions.
Many do not skimp on formalities and take action without asking questions. However, if it is not carried out adequately, the experiment, although initially motivated by good intentions, can end in a bitter failure, forever breaking the close bonds that united individuals.
Before we get there, let's take a look at how to proceed so that the adventure has every chance of succeeding. There are two possibilities: purchasing a rental property to make an investment or purchasing a house to live under the same roof.
Investing in rental property
The process to follow includes many steps that should not be overlooked, although some elements may seem unimportant.
- Specify each person’s share in the building.
- Carry out a description of the tasks: administration, maintenance, renovation, etc.
- Evaluate the value of these tasks in terms of time and money.
- Divide tasks equally between parties.
- Sign a partnership agreement which will specify all aspects of the collaboration. What is each person's share? Who does what ? How will decisions be made whether or not to carry out the renovations? What happens if you lose your job and fail to meet your obligations? How to sell your share? Etc.
- Maintain good communication at all times. Do not let problems and frustrations linger that can overshadow the success of the project.
Buying a house and owning a home
Buying a house with loved ones with a view to living in it takes essentially the same steps mentioned above, but in addition, there is an added degree of difficulty: the fact of living together. Sharing someone's daily life and meeting them from time to time are very different concepts. Here are some ideas for discussion to consider before committing.
1. Compare your lifestyles.
Are they compatible?
2. How will guests be handled?
3. Can we organize parties?
How often ?
4. Who will do the cleaning?
The kitchen ?
5. How are invoices paid? Do we make a pot that we renew when it is exhausted?
Living under the same roof is not for everyone. If one partner does nothing and lets things go, the other co-owners will experience a lot of frustration.
In conclusion
Buying a property as a financial investment vehicle or for housing remains a good idea in itself.
However, all aspects of this collaboration must be defined beforehand. Do not assume that disagreements and conflicts will not arise because you belong to the same family or are part of a group of friends. If it is impossible to define the project and sign a written agreement, it is better to pass.
ADVICE
- Consult a lawyer who will inform you about all the legal aspects of your project.
- Sign a partnership agreement.
- Do not avoid problems and difficulties by maintaining good communication.
Source : Article by Ghislain Larochelle on the journaldemontreal.com on the 19th december of 2023
Link : https://www.journaldemontreal.com/2022/12/19/acheter-une-propriete-avec-un-ami-est-ce-une-bonne-idee
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