Would you buy a house with a stranger?
The new millennial ‘dating’ trend is all about scouting out potential property partners, finds Cara Mcgoogan
In a dim basement bar in the shadow of St Paul’s Cathedral, the day after Valentine’s Day, 20 young professionals met for a night of alternative matchmaking. Fuelled by free cocktails, platters of fried finger food and a list of revealing questions, they had five minutes in which to make an impression, share vital statistics and gauge if they could see a future with any of the rotating cast of strangers sitting in front of them.
Welcome to the reality not of dating but house buying in 2018, where pooling your money with someone you’ve never met before might be the best option for millennials trying to hurdle the huge generational divide in the housing market gap.
This week, new research by global property adviser Savills revealed over-50s hold 75per cent of Britain’s housing wealth, to a total tune of £2.8trillion in equity. A fact that might be unremarkable (after all, they’ve had 25 years to pay off the mortgage on wildly appreciating assets), if it weren’t also for figures from the Institute for Fiscal Studies, showing home ownership has more than halved among middle income 25 to 34-year-olds since the Nineties, as spiralling house prices have far outstripped wages.
If the bar for first-time buyers is tough for young couples to clear together, it’s near-impossible for single people. Last year, research by London & Country mortgage brokers suggested millions were willing to stay in a relationship they no longer wanted to be in, purely to max out their mortgage income multiples.
This is where HSBC hoped to play matchmaker, tapping into the growing market of young people exploring their options.
Armed with 25 questions provided by the bank, the prospective property partners had to discuss their home and housemate preferences, schedules, hobbies and DIY skills. Crucially, they also had to reveal how much money they have for a deposit, their credit rating and any financial impediments. For those who passed muster, there was a pile of blank business cards on each table, for them to swap details.
For some, the prospect of buying with a stranger is actually a more attractive option than investing with a romantic partner. “I wouldn’t want to live with someone in a romantic way,” Olivia, a 23-year-old photographer, tells me – echoing others, nervous about the potential of ruining friendships, or losing out financially in the aftermath of a break-up, who would rather invest with someone with whom they have fewer emotional ties.
Three pairs emerged from the two hours of timed introductions, including Joe, a 24-year-old actor, and James, a 30-year-old technology consultant. Despite having £40,000 each for a deposit (James has been saving for five years and Joe is paid well for acting), both want a better property than they could afford on their own, but have struggled to find someone they know who’s in a position to share a mortgage.
“A lot of my friends are in relationships and didn’t want to buy,” says Joe. “If I went on my own, I’d get a crummy place. But if we double up we can get somewhere a lot nicer.”
The pair are on the same page when it comes to what they’re looking for: a two or three-bedroom place in north London, preferably with a garden or balcony. They want to live with someone they get on with, who will be relaxed, yet responsible. To date, they have been lucky with their living situations: Joe lives alone in south London and James with two friends in West Hampstead.
So what if they don’t get on? “You can always rent a room out,” says James. “Put it down to experience, take the capital growth out and move.”
If a 2006 experiment is anything to go by, they needn’t worry. Although the housing market was by no means as impenetrable 12 years ago as it is now (the average house price was £177,000 compared with £227,000 in 2017), a BBC reality show, Would You Buy
With a Stranger?, matched two prospective homeowners to help them buy their first property.
The main contestant Kate Matthews, now 43, had found it hard to find a place to buy alone: “I’d been renting for years and was fed up of putting money into landlords’ pockets.”
Kate went on “property dates” with prospective matches, and chose Matt
Scrimshaw, with whom she played virtual golf in Soho on their first “date”.
“If you’re buying a house together, it’s nice to have someone you can’t see yourself falling out with,” she says. A secondary schoolteacher in a rut, Matt was the same age as Kate, 30, and bored because his girlfriend was away travelling. When he saw a flyer for the show, he thought: “‘Why not?’ It was mainly based on adventurism.” That spirit carried him through the first stumbling block, when the pair had to stump up £8,000 each for the deposit. “I didn’t actually have the money,”
says Matt (a fact he hasn’t told Kate to this day), who had to borrow from family and friends in order to buy the property the producers had found: a £252,000, three-bedroom, split-level Victorian conversion in Brixton.
“When you’re looking at buying a house with a stranger, you don’t have to think of it as a forever home,” Kate says. “Once the mortgage runs out, you can go your separate ways.”
In 2011, she bought Matt’s share of the house, which is now worth around £600,000, and rents it out while living in Forest Hill with her husband and two children.
Matt has some regrets about selling his share so early, but doesn’t begrudge Kate the dividend. He’s aware that his property-sharing venture came at a different time, when banks were still happy to offer interest-free mortgages and 5 per cent deposits, but would still recommend it, with due diligence. “I can see this generation being a bit more organised and going into it in a more businesslike way.”
As for Joe and James, they’ve been for a few drinks together, and are now taking things to the next level: property hunting online. “It’s going to be a slow process because we have to find the right place and get to know each other really well,” says Joe. “But it’s going well, I’m pretty optimistic.”