More people co-buying homes with friends and family to share costs

What to keep in mind when co-buying a home

Consumer Reporter Heather Sullivan talks with Cesar Rincon, a real estate agent in the Memorial area, about the growing trend of co-buying a home. They also talk about the recommendations and preparations that potential co-buyers must consider to ensure a successful partnership.

HOUSTON - With home prices rising, more people are co-buying homes with friends or family members to lower their individual costs, according to an industry report.  They split mortgage payments, utilities, and expenses, while their equity grows.

How much can co-buying save?

By the numbers:

A recent study by real estate website Zoocasa found co-ownership can save buyers $10,000 a year in Houston.

A report this year by JW Surety Bonds reports nearly 15% of Americans have co-purchased a home with someone other than a romantic partner. Millennials and Gen Z buyers are among those co-buying, along with multi-generational families.

What to consider before co-buying

Big picture view:

We spoke with Cesar Rincon, a realtor with Memorial Real Estate Group, who has helped co-buyers purchase homes.  He says they first must take steps to prepare for the purchase.

"Making the big purchase is a huge decision. Credit is important. Having savings is important. But it’s also important to have a long-term vision of what’s going to happen 2, 3, 5 years from now with the property," explained Rincon.

He recommends they also make a plan for handling expenses.

"Utilities, maintenance, upkeep. Who’s going to pay for gardening, repairs, and things like that?  They need to have a safety net so they can take care of it and not be splitting hairs on who’s paying for what," he said.

We asked him how co-buyers handle situations when one person wants to sell, move out, or loses a job.

"It’s important to have a future plan ahead of time.  If someone meets someone and wants to get married, or move to another state, they need to have a plan ahead of time so they know what’s going to happen," Rincon said.

Many multi-generational families are co-buying homes together as well, such as families buying with retired grandparents.

"In some cases, what they do is buy a two-story home where the older children can live upstairs, and the parents can live downstairs, so there’s that separation.  And there are also multi-generational homes being built these days that have an auxiliary unit. That’s a full unit with a kitchen, a bathroom, and everything connected, but separate at the same time," said Rincon.

Experts also say it can also be a good idea to have a joint bank account to make transactions, and have three to six months worth of expenses set aside for unexpected emergencies.  Some co-buyers use an attorney to write-up agreements.