Triplets buying properties together

Whitee

Hi,

I'm just wondering whether it would be a financially good idea for my brother sister and I to get into property together. We all are looking to buy our own property to live in this year / early next year.

Seen as though we are all coincidently doing this at the same time would we be better off starting a small business out of this/putting in together for cheapest rates?

All have £10,000 each with good credit ratings and saving £1,000 / month each in long term jobs. Aged 27.

Brother earning £40,000 /annum
Sister earning £25,000 / annum
Me earning £25,000 / annum

I understand mortgage applications will take income of 2 people but will our interest rates be better off doing it together rather than solo?

We are currently living in a rented property together (family home) paying total monthly rent of £600 / month. I personally would love us to buy this house if we could. Say put in 7k each for deposit (house value approx £110,000) split the monthly mortgage costs, keep saving £1,000/month put back in for another mortgage when we are back to having £7k each which should be 4 months down the line and so on. We would be looking at properties no more than 120k

Would this at all work? Would we have to become a limited company to gain access to multiple and the best mortgages? I have read the tax is high for a limited company so unsure what would be best.

I would plan on speaking to a mortgage advisor just wanted to see if this would be beneficial or not first or if it wouldn't make much of a difference as opposed to doing it solo.

I would like to invest a property to let out also would this be out starting block to doing so?

Thanks for reading and for replies if you wish to give a little advice or encouragement.

marliepanda

What are you going to get out of this?

£200 a month each of you rent it out later? How long will this take to wipe out your tax liability, now and in the future?

You'll end up paying higher stamp duty when you buy your own.

Pixie5740

Are you looking for a home or a rental property?

Did you speak with a mortgage broker as suggested in your previous thread?

G_M

If you buy a property to let out 1st, then when the 3 of you buy together, you (all, jointly) will have to pay the additional SDLT.

If the 3 of you buy together, and then you (singly) buy a property to let out, then you (yourself) will have to pay the additional SDLT.

Bear in mind that buying property jointly is as big a decision, if not bigger, than marriage. Think that through.

Consider all possible future scenarios, talk them through together, agree what you'd all do, and get it written into a deed or similar eg

* one of you wants to buy elsewhere, and sell their share
* one of you gets married and wants spouse to move in
* one of you loses their job and can'tcontribute towards the mortgage
* a large expense arises (roof, boiler, damp etc) but oneof you can't afford to share the cost - or disagrees that the work needs doing
* the one who got maried, now gets divorced and their spouse claims a proportion of the property
etc

tom9980

Brother earning 40k is likely to become a higher rate tax payer.

Cakeguts

How on earth would you work out who pays for what in which percentages? I can see a lot of arguments and a lot of extra stamp duty.

Whitee

My thoughts on what I/we would be getting out of it would be instead of each paying rent on our current home we could be paying towards a mortgage on the home at a cheaper monthly cost.

Buying additional properties with sis and bro could potentially give us better mortgage rates than doing it on our own?

Whitee

Our if curiosisty how much is additional stamp duty?

teddysmum

I'm assuming that you want to buy a property between you, which you will all three live in, but at some stage, at least one of you will want to be alone with a partner and possibly family.


As has been mentioned, even part owning will mean that you will all have to pay the extra stamp duty when buying your own home, but then there is the mess over how much the leaving person wants for their share (if the others want to deal) , whether the remaining two, or one, will be able to afford the mortgage with less sharing the payment and the cost of a remortgage for the remainers , as you can't just have your name taken off a mortgage; you need a new deal.

Whitee

Haven't spoken to a broker yet

Whitee

The home wouldnt be us 3 living together