Owning a student-house

crompton

I am about to start university in the next few weeks. While packing today a thought crossed my mind. From about February/March (still a while away i know) we have been advised to start looking for 2nd year accommodation.

5 students (Close trustworthy friends) each with £3400 for accommodation, over 2 years = £17,000

I'm still not sure how viable it is but my thoughts were, attempt to just 'buy' a house between us, with parents acting as Guardians on the mortgage. Use a % of the £17000 as a deposit. The rest goes to pay the first few mortgage payments and then use money from jobs to pay the rest.

Over the 2 years, we gradually get the property ready to let to a group of 6/7 students. Rent the property out with each of the students paying a few hundred pounds rent per month (a fair rate set after market research and comparison) and eventually the house will pay for itself. If everything does go bottoms up, we just sell the house (provided we get a buyer!)

The thoughts behind it is that students always need somewhere to live, although the pitfalls include not being able to pay the rent in the first few years, not getting tenants etc.

Edit: The other thing is, the University I am going to is planning to demolish the current student village and keep its campus accommodation but expand its recommended landlord portfolio.

I know this is only a sketchy idea at the moment, and the key thing is it is JUST and idea. But do you think this could work? Do you know anyone that has done something similar? Is there anything we could do to improve the idea? Any thoughts are appreciated. What do you think? :huh:

Cheers.

Jowo_2

Never mix business and friendship - personal relationships will break down much more easily when financial risk is involved.

Running_Horse

Can you imagine the arguments between five owners?

Who then go their different ways in two years?

What could possibly go wrong?

nightbuffalo

I've heard of this going very breast-up when two friends have bought a house and it all ended very acrimoniously.

granted, that doesn't mean it can't end well, but I'd give it a serious mulling over before doing it - there's just so much that could go wrong.

why put an utterly avoidable strain on a good friendship?
rent, enjoy your friends, enjoy uni.

(in considering this response, bear in mind pessimism is my religion!)

good luck.
nb

Kavanne

you probably wouldn't get a mortgage anyway so don't bother!!

Doozergirl

If there was ever a hairbrained plan on here; and I'm sorry for being rude; it's yours.

If you did get a mortgage what happens in 18 months when you're all planning to move on, get jobs buy real homes for yourselves exactly? And if property prices fall again, how do you propose to pay off any negative equity? And who deals with the repairs and the admin? Is that split equally between five (obv not) and does the person who organises everything get a larger share of the equity if prices rise and they've put the work in?

Being a LL is a pain in the proverbial if you've other things to do. Owning a house with people you don't want to spend the rest of your life with is a pain. The unpredicatbility of the market is a pain. Put together in a pot you end up with a potential disaster.

PasturesNew

You'd need to find a house that has an HMO license (or go to the trouble/expense of upgrading a house to get one).

One will drop out
Another will want to move his gf in
Third will refuse to pay up in year 2 and spend it on beer
Fourth will live like a pig
Fifth will be a party animal and fill the place with his mates

Which one are you?

BitterAndTwisted

Pastures New we're talking about students here, you've made no mention of drugs and all five will live like pigs because once Piggy One declines to do any cleaning all the rest will as well. Piggy Two will decide to only contribute 50% of their share of the heating and hot-water costs because they are always round at their girlfriend's place. And it goes on

gettingbetter

hi

can i just add (i live in a uni town)
5 bed house here is offers over £275,000
thats not in the best area
student rents are £500 per bed per month
whats gonna happen to your surplus
who will controll it

yes its a good idea and could save money in the
long run but i see it as being one big headache

sorry just my opinion

kas xx

MoneySavingSpender

If you were in mid to late 20s or older, mature, experienced in life, managing your money properly, able to deal with money and relationships, able to save money, able to get a mortgage on your own without depending on anyone, I'd say yes.

But teenagers? Co-joining a house? Recipe for more grief, heartache and madness than you could dream of in your worst nightmares.

basscadette

Buying a house altogether is a mad idea and bound to run into problems. If i was a probability lady I would suggest that you plan has 0.05% chance of being a roaring success.

What if you all (or some) fall out
What if one of you has serious money problems in the future
What if one wants to sell
What if major repairs need doing and no one will stump up due to funds?

A better idea is if you buy it with your parents help and charge your mates rent to cover the mortgage, although with the way things are at the moment in the housing market, and how short-term int he scheme of things that uni life is, I wouldn't bother.

I should have done this as I went to uni at the bottom of the market when houses were going (in the uni town I went to) for literal peanuts. Wish I had now but was too busy having fun to think about buying houses and responsibility.