The People Buying Houses With Their Friends

Picture the scene: You’re WhatsApping your best mate photos of the rainwater that is now dribbling through a hole in your ceiling, interspersed with a range of anger-themed GIFs, and topped off with the screenshot of your landlord’s text saying that he’ll “get around to sorting it, but it’s simply not a top priority right now.” And your mate replies: “God… imagine if we just bought a house together.”

A decade ago, this might have seemed like a far-fetched idea, but as a result of the terrible situations faced by so many renters, a new trend has emerged. In lieu of waiting for the love of their life to come along and chip in, young people are turning to their friends.

A recent survey by Fairview New Homes found that 44 percent of 18–24-year-olds who have yet to own a home said they would likely buy one with a friend. And the latest data by PACASO, an American company specialising in house co-ownership, shows a 21 percent year-on-year growth in co-ownership among friends and non-married partners.

In the UK, it’s not hard to see why. A quarter of renters in England are spending more than 40 percent of their income on housing, and the country was described as “the most difficult place to find a home in the developed world” by the Home Builders Federation. Soaring house prices have left stagnant wages behind, and a survey by Zoopla found that 42 percent of people aged 18-39 have abandoned the idea of owning a home altogether.

"It’s been a particularly challenging time for homebuyers, especially those making their first move on the housing ladder," Ben Thompson, deputy CEO of Mortgage Advice Bureau, tells VICE. More and more people, he says, are looking at different paths to homeownership. "There are upsides to buying a house with friends,” he explains, “a deposit can be halved, mortgage payments shared, and bills and other expenses can be split down the middle."

David (who’s chosen to remain anonymous for privacy reasons) is 41 years old and bought a house with his friend. “Buying a house is so prohibitively expensive,” he tells VICE, “I certainly didn't have enough money for the deposit on my own, so it was the only way we could financially afford.” He says he had known his friend for years. “We’d both spent a lot of time renting by then, so we thought we could get on the property ladder this way. As long as you got on the ladder, then you just basically make money by doing nothing,” he adds.

Of course, there are some major barriers to face when trying to buy – the key two being: deposit and affordability. But Nicholas Mendes, a mortgage technical manager for John Charcol, believes co-ownership can help you hurdle them. Firstly, you can put more money into the deposit pot, which eases the long-term burden of the mortgage. On top of that, says Mendes, "Purchasing a house with friends rather than doing it alone also allow you to increase your maximum borrowing potential, so you are more likely to secure the right property for you.”

After spending over a year looking at potential homes that were over her budget, Kassandra Castillo, 33, teamed up with friends to buy a property. "Luckily, we did not experience any financial difficulties in our purchase. Everyone was financially stable, and we agreed to be open and honest about our budget. Things have gone according to plan so far," she tells VICE. However, she warns: "It's essential that everyone understands the financial and legal obligations and avoids a purchase beyond their means… being realistic with what you can afford on a long-term basis is hugely important."

Obviously, the main counter-argument to co-ownership is the sheer amount of stress it could put on even the strongest mates. Buying a house together is probably right up there with the most likely things to destroy a friendship – alongside, perhaps, falling in love with the same person, and playing Monopoly together.

“Obviously, once money is involved with friendships, it does have the potential to get quite complicated,” says David. “You aren’t just friends anymore, you’re like economic partners. I think it was always in the back of our minds that this could get messy.” He adds: “We never really sat down and talked about it, and that was a bit of a fuck-up, to be honest. It turned out we did have quite different ideas about how the process works. It was really stressful.”

Bob Steel, mortgage development manager at First Mortgage, thinks that mixing friendships with money can be fraught with danger, and it tends not to end well. "Whilst friendships can last a lifetime, in our experience, co-owners need to sell up sooner than anticipated due to external factors," he says. When chatting with prospective co-owners, Steel says they often think, “that won’t happen to us”. But, he says, “More often than not, it does, and the relationship falters."

That doesn’t mean you shouldn’t go ahead with it. Steel recommends that anyone considering owning a home with their friends should have an "open and frank discussion" about all the potential pitfalls of buying together, and agree on how to deal with things before they happen. For example, what will you do if someone would like their partner to move in? What happens if one of you wants to sell up? And what if someone falls ill and their income takes a hit?

"Living with anyone, whether it’s a friend or spouse, can lead to conflict, but it doesn’t have to," says Karen Barrett, CEO and founder of Unbiased. She suggests that having a legal agreement, a joint bank account and a will to determine who inherits any shares in the property are always necessary.

After five years of living together, David eventually sold up with his friend and they moved into separate homes. He says that while it did put a strain on their relationship, and there were compromises throughout the process, he still strongly recommends it. “The property prices are ridiculous. Cruel,” he says, “But over the time we lived there, the house went up in value, and we sold it for a lot more than we bought it for.”

The idea of buying a house with friends is still terrifying to many people, and if you take a glance at the stories of people who have tried it on Reddit then you’ll feel terrified too. But there are plenty of counter stories out there of people who have made it work to their advantage. Given that there are more than 28 million single people living in England and Wales, perhaps there’s never been a better time to pool your savings pot with your pals.