There’s more to buying jointly than paying a bond

BUYING a property with a relative or friend can be a great way to get a foot on the property ladder.

But property is not a shortterm investment, so make sure you talk through the various aspects of property ownership carefully.

“Buying a property jointly may mean that you can afford the costs of home ownership, as you will be using the power of two incomes” says Albertus van Staden, head of credit at FNB Housing Finance.

“However, the long-term horizon of property ownership means there is a good chance that either of your circumstances may change.”

It’s important to understand what your expectation is from the outset. For example, if your parents have bought jointly with you, are they expecting a return on their investment?

“If friends are buying for investment purposes, what is the timeline? And who will occupy the property?

“If you are are living in the property initially, you need to outline what will happen if one moves out and who is responsible for getting a replacement tenant.

“You or your partner will still be responsible for a portion of the bond after moving out,” says Van Staden.

If you are letting the property, you will probably have to put in more money than the rent, especially in the first few years as the rent won’t cover all the expenses. There is also personal income tax to consider.

Property ownership is more than just the money that needs to be paid each month.

“Properties require time and effort. Just like a car, it needs to be maintained and kept in good condition,” says Van Staden.

“Who will be responsible for dealing with the tenants, and any property maintenance issues such as burst geysers or general sprucing up?

“Both parties should have the full obligation to keep up with ongoing maintenance.”