NORFOLK, VA, Jul 25, 2013—It sounds like a dream; splitting the cost of a lakefront home or woodland cabin with your close friends. However, purchasing a group home can end up being more complicated, and that's before you throw in any possible falling outs or conflicting schedules. Below, Louis Eisenberg, Associate Broker REALTOR ABR SFR of Prudential Towne Realty takes us through a variety of things to consider before purchasing a home with others.
1. Discuss finances first
Can everyone afford to do this? “To minimize complication, it's best for everyone going in on the purchase to be able to put down equal funds,” suggests Eisenberg. In addition to discussing purchase costs, go over who will pay for furnishing the home, improvements, monthly bills, taxes, etc.
“It's important to really scrutinize the financial coverage, from little things like landscaping to emergencies like a flooded basement,” Eisenberg notes.
2. Write it down
After you have a clear plan that all parties agree to, get everything in writing. This will be helpful in the future should someone forget who agreed to pay for those new energy efficient windows. “It might be a good idea to bring in a lawyer to help come up with a contract everyone agrees to,” suggests Eisenberg. A lawyer will not only help document your decisions, but also map out any additional legal concerns – like what will happen to an individual's share of property should they pass away.
Although it may be uncomfortable, you should also talk about what will happen to a property share should someone want to sell or liquidate their assets.
3. Decide how the home will be used
After you've taken care of the legal and financial issues, it's time to talk about the fun stuff: how you will enjoy your home. Will you split up visiting dates throughout the year? Will you all visit at once, reunion style? “While it might seem silly to designate days up-front, it will ease any future tension should schedules clash,” says Eisenberg. Additionally, talk about what will happen to the property as your lives progress. A group of friends purchasing a home in their late twenties will surely use the property differently than a group of friends who are now in their forties.
“After you have your basics covered, celebrate with your friends and enjoy your new vacation home!” says Eisenberg.
For more information on buying a home, please contact Louis Eisenberg, Prudential Towne Realty, 109 E. Main Street, Norfolk, VA 23510, leisenberg@prudentialtownerealty.com, (757) 572-7244, or www.LouisEisenberg.com
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