Co-Buying 101: Your Guide to Buying a Home With Friends or Family
Homeownership is a big deal y’all, and a major life milestone for so many people. Traditional homeownership has often looked one way – a married couple buying a house together. But with the world changing, prices rising, and community building being at the forefront of so many minds, the idea of homeownership is expanding.
If buying a home has felt out of reach, you don’t fit the traditional mold, or you’re just interested in learning about your options, I’m here to guide you through the wonderful world of co-buying. This blog post will break down what co-buying is, why it’s becoming more common, and every part of the process so you and your crew can feel confident taking this exciting step.
Expanding the Idea of Homeownership
Let’s toss out this idea that there is a single right way to buy a home – there is only the right way for you. We are all uniquely human, with our own values, our own community, and our own financial situations. What works for your friend or your family member, may not work for you, and that’s okay! It’s okay if you fit within the traditional box, and it’s also okay if you operate outside of it. No matter what, you’ve got options.
Co-buying is all about making steps towards homeownership with those that don’t fit into the traditional box. Maybe you’ve been renting with a roommate for years and want to turn that into something more permanent. Maybe you and your sibling want to build equity instead of paying someone else’s mortgage. Or maybe you’re a group of friends who’ve dreamed of owning a property that doubles as an art and community space.
This path is all about getting clarity on what the idea of home really means, and investing not just in a property, but also in your people. It’s an opportunity to say “this is my life, and I am going to make it happen”. And as your built-in cheerleader, I love that for you!
Why Co-Buying is Becoming More Common
Look, it’s no secret that prices are going up and living wages are struggling to keep up. Many of us have the same dreams of homeownership as people did twenty years ago, but not the same level of access to make those dreams a reality.
Beyond inflation, our idea of chosen family and value we put into our community is growing. So many folks are finding connection and fulfillment outside of a traditional marriage, and lean on their friends, their chosen family, or even their regular relatives for that feeling of home. Expanding our idea of homeownership allows us to not only dream about the who, but also the what – we are able to really consider what we want home to feel like and provide for us.
Here are a few things I think are big benefits to buying a property with your people:
More buying power: being able to pool together resources to quality for a bigger loan and/or provide a bigger down payment
Shared expenses: help covering the cost of the mortgage, utilities, repairs, and more
Built-in support system: being able to share tasks like chores, pet care, or child care
Creative living options: many options to divide the space, whether it’s living in one space together, dividing it into separate entrances, or even living in an ADU out back
Co-buying can open the door (literally) for so many folks who feel ready to make this big move, but aren’t quite sure how to make it happen. Whether it’s financial worries, pressure to wait for a spouse, or just a desire to be surrounded by your community, co-buying can create some incredible opportunities.
The Co-buying Process
Hopefully by this point, y’all are excited – I know I am. So what’s next? Here’s where the fun stuff starts. You have your dream, it’s time to connect with your people, and make it a reality.
Get to Talking
The first step of any co-buying experience is making sure you and your crew are on the same page. This is sometimes the most exciting, but also the most daunting step for so many folks because it can feel overwhelming trying to figure out where to start.
But don’t fret! I’m here to help!
Here’s a list of some good conversation topics, as a starting point:
What are our home-buying motivations? Investment, community, something else?
What do we value in a home? What do we want it to feel like?
What is the ideal home set-up? Are we all sharing one space, or do we prefer a division (like a duplex or home with multiple entrances), or maybe a home with an ADU?
What do our finances look like? How much can we contribute to down payment, ongoing mortgage, ongoing maintenance, or even chosen renovations?
What are some of our must-haves? What about nice-to-haves?
These questions aren’t all glamorous, but will really help to get your team on the same page. Aligning on these now means that everything else – from working with a lender to touring homes – will be that much easier. You’ve got this!
Build Your Super Team
Having the right team around you can make a huge difference in your co-buying process. These are the people that will educate you, advocate for you, and guide you through the ins and outs of buying a home.
You’ll want to find a real estate agent (hi, that’s me!) who really gets co-buying, from both a process and values perspective, as well as a lender who is familiar with shared ownership loans. Your real estate agent should be able to connect you with the lender, as well as anyone else you’ll need as things pop up, such as vendor referrals.
Many also find it helpful to work with a real estate attorney to develop a co-ownership agreement that covers details like ownership percentages, how decisions will be made (repairs, refinancing, selling, etc.), what happens if someone wants to sell their share or move out, and more.
Get Pre-Approved
The next major step is to work with that trusted lender to get pre-approval. When multiple buyers apply for a mortgage, their income, credit scores, debts, and assets are all considered. This can work for you or against you, so transparency with your people and your lender is key. For example, a strong credit score can help balance a weaker one, but one person’s debt may impact the other buyers. This is why financial conversations are so important to have early on!
And as a heads up, the lender may approve you for more than y’all want to pay, so it’s important to remind each other of your goals and budgeting from early conversations when going through the pre-approval process.
Let the Search Begin
Your pre-approval is essentially your golden ticket to moving forward with the house-hunt – my favorite part! A good agent (hi again!) will take the time to really understand your goals, your needs, your budget, and help make it happen. They are your resource for any and all questions, and will help provide additional ideas and vision. They’ll know the ins and outs of the neighborhoods, how to write a competitive offer, and guide you through every step.
As you’re touring houses, remember to slow down and really envision how this space fits your goals. Does it have an ADU out back or a separate entrance? Does it have a big enough kitchen for your crew? Is there room for a garden out back to grow meals for your community? Are there opportunities for fun renovations or house projects to help grow your investment? There is so much more than aesthetics that matter when it comes to a home (although that matters too!), so it’s important to always bring it back to your what and why.
Finding the One
Once y’all find the right house, your agent will help write a competitive offer, schedule inspections, get repair bids from vendors, handle all negotiations, and close the deal. This time can be intense for many, but the right agent will have your back every step of the way.
Final Thoughts
Homeownership is a major milestone for so many people, so with the world changing and values shifting right along with it, people are redefining what it looks like to buy a home.
An increased value in community, a letting go of there being a right way to do things, and a desire to make homeownership more accessible has led to the rise of co-buying, and all the benefits that come with it. With co-buying, homeownership may not just feel within reach, but even more desirable for so many folks who are dreaming of building a community with friends, having multi-generational living arrangements, and more.
If you’re interested in learning more about co-buying and want to work with an agent who gets it, I would love to support you through this awesome experience. Everyone deserves a home that feels like them, and I’m here to help make that happen.
