How do I work out my percentage share of our property?

deaston

I've sold my house and am buying a property with my partner. My partner is putting in no money upfront, but we will have a joint mortgage.

Joint mortgage: £460,000
House purchase: £780,000

The difference and £45,000 cost of moving has been paid by me from equity and savings. What's the fairest way to decide upon the percentage share?

Guest101

Well if you don't trust your partner, then I don't think you should be buying a house together. But with that said:


You have a 58% mortgage, so that's a straight forward 29% each. Add in your capital contribution,


You own 71%, she 29%. - 70/30 for ease.


The moving costs are costs you would have incurred anyway, and I'm not sure how you spend £45,000 on moving?! Is there anything you've paid extra you otherwise wouldn't have, if you were moving alone?

HappyMJ

deaston wrote: »

I've sold my house and am buying a property with my partner. My partner is putting in no money upfront, but we will have a joint mortgage.

Joint mortgage: £460,000
House purchase: £780,000

The difference and £45,000 cost of moving has been paid by me from equity and savings. What's the fairest way to decide upon the percentage share?

Partner? What an easy question. 50/50. If you're not willing to go 50/50 then do not buy a house together.

£45,000 cost of moving. Ouch. Where did that figure come from?

Your partner will have £230,000 of the mortgage responsibility so if you wanted to go by percentages then go by that 30/70.

If I were your partner I'd walk away if it wasn't 50/50 though.

Paully232000

HappyMJ wrote: »

Partner? What an easy question. 50/50. If you're not willing to go 50/50 then do not buy a house together.

£45,000 cost of moving. Ouch. Where did that figure come from?

Your partner will have £230,000 of the mortgage responsibility so if you wanted to go by percentages then go by that 30/70.

If I were your partner I'd walk away if it wasn't 50/50 though.

I would imagine that £30K of that is stamp duty, and then removals costs, estate agents, solicitors

charliewocka

Our declarations of trust has split the houses the following ways:


The amount of money my partner put in is experessed as a % of the purchase price (the equity he left in our BTL is also expressed as a %). The remaining is split down the middle.


So, if we separate, he will get x% of the equity in the house. Remaining equity is split 50/50.


Yes, we do trust each other but I don't see why I should 'profit' from him having owned houses beforehand. We've discussed me buying more share in the property at a later date if I want to get equal %, and if we get married whether we will become joint tenants.


Our wills are arranged so that in the event of death the other person is left the share of the house.

Guest101

HappyMJ wrote: »

Partner? What an easy question. 50/50. If you're not willing to go 50/50 then do not buy a house together.

£45,000 cost of moving. Ouch. Where did that figure come from?

Your partner will have £230,000 of the mortgage responsibility so if you wanted to go by percentages then go by that 30/70.

If I were your partner I'd walk away if it wasn't 50/50 though.

Think we agree, except I'd buy as joint tenants, both owning100%, rather than 50/50 Tenants in common.

Guest101

charliewocka wrote: »

Our declarations of trust has split the houses the following ways:


The amount of money my partner put in is experessed as a % of the purchase price (the equity he left in our BTL is also expressed as a %). The remaining is split down the middle.


So, if we separate, he will get x% of the equity in the house. Remaining equity is split 50/50.


Yes, we do trust each other but I don't see why I should 'profit' from him having owned houses beforehand. We've discussed me buying more share in the property at a later date if I want to get equal %, and if we get married whether we will become joint tenants.


Our wills are arranged so that in the event of death the other person is left the share of the house.

Wow. So complicated for absolutely no reason...

deaston

HappyMJ wrote: »

Partner? What an easy question. 50/50. If you're not willing to go 50/50 then do not buy a house together.

£45,000 cost of moving. Ouch. Where did that figure come from?

Your partner will have £230,000 of the mortgage responsibility so if you wanted to go by percentages then go by that 30/70.

If I were your partner I'd walk away if it wasn't 50/50 though.

The stamp duty alone is £29,000. With all the other costs it quickly adds-up.

If I were to do 50/50, I'm essentially handing my partner £182,500 - that seems a bit careless on my part.

deaston

charliewocka wrote: »

Our declarations of trust has split the houses the following ways:


The amount of money my partner put in is experessed as a % of the purchase price (the equity he left in our BTL is also expressed as a %). The remaining is split down the middle.


So, if we separate, he will get x% of the equity in the house. Remaining equity is split 50/50.


Yes, we do trust each other but I don't see why I should 'profit' from him having owned houses beforehand. We've discussed me buying more share in the property at a later date if I want to get equal %, and if we get married whether we will become joint tenants.


Our wills are arranged so that in the event of death the other person is left the share of the house.

Out of interest, have you ever discussed the issue of stamp duty? I'm aware that I'm paying the full £29,000, even though, on paper, we jointly own the property.

If we separate, there's no way my partner will be able to buy me out, so I guess I'd take on the property myself. However, I'd then have to pay another £9,500 in stamp duty.

OR - would my partner effectively owe me half of the original £29k...?

Also, is your 'declaration of trust' an official thing? Or something you've sorted out between yourselves?

Guest101

deaston wrote: »

The stamp duty alone is £29,000. With all the other costs it quickly adds-up.

If I were to do 50/50, I'm essentially handing my partner £182,500 - that seems a bit careless on my part.

Perhaps you're not really 'in' the relationship. Don't see it lasting? Don't trust her?


Maybe house purchase isn't the right thing right now?


Rent for a few years, let the equity build up?

HappyMJ

deaston wrote: »

The stamp duty alone is £29,000. With all the other costs it quickly adds-up.

If I were to do 50/50, I'm essentially handing my partner £182,500 - that seems a bit careless on my part.

Then don't do it. Are you married? Once you're married everything you own is added up secured debts deducted and the remainder split 50/50 on divorce whether you owned it before you got married or not.

Could you buy the property wholly in your own name? That would be an option. The house would be 100% yours. If you split there would be no need to re-mortgage to buy out your partner. You could just give your partner a couple thousand to go and rent somewhere.