The benefits and drawbacks are listed below.
Paul Roelofse, a licensed financial planner, and Gugs Mhlungu were conversing.
Many people are unable to purchase property due to the high cost of living and the current interest rate.
People are now considering alternative entry points into the real estate market.
According to Roelofse, co-purchasing with friends or family has grown in popularity.
The advantages and disadvantages of Roelofse are listed below:
Pros
More Options and Money
When you join forces, you have more money to invest in real estate and more options.
Divide the costs.
Each person can afford a property more easily if they split the costs of buying it.
Transfer duty, buyer registration fees, agent commission, and sale capital gains tax are all factors.
While the property is owned, maintenance fees and levies are split.
Better Offers
A better bond application might result from pooling incomes.
Each partner’s creditworthiness will be taken into account by the bank, but having more co-buyers lowers the possibility of payment default.
Cons
Risk of payment
The project is in danger if someone fails to make their payment.
All co-buyers will suffer financially as a result of having to find the extra money, and the bank wo n’t be satisfied.
Friction
If all parties do n’t agree on the same thing, it can be difficult to come to an agreement with all co-buyers regarding issues, finances, the use of the property, or future developments.
Exiting
It is important for everyone to plan for and understand how to leave the project because it is a serious issue.
Expectations for returns are frequently unmet, and the hassle of maintaining the property is not thought to be worthwhile.
It will be challenging to choose to leave.
The share may need to be purchased by the remaining co-buyers or a suitable replacement may be found.
You’re just going to share it, and I believe that’s why co-buying has a really good opportunity. It will still come with all the other ups and downs that property owners experience.
Certified financial planner Paul Roelofse
In the end, it’s not really easy sailing.
Certified financial planner Paul Roelofse
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