Get it all in print if you’re co-owning a home, says estate expert
Posted July 14, 2018 11:45 am.
Last Updated July 14, 2018 6:16 pm.
This article is more than 5 years old.
VANCOUVER (NEWS 1130) – Shopping for a property with family or friends? An expert says make sure you get all the details in print before you sign the dotted line.
Vice President of Tax and Estate Planning with the Investors Group Christine Van Cauwenberghe is mapping out the best way to snatch up that home or summer cabin with multiple buyers attached.
First thing’s first–before you set off on a hunt for the perfect abode she says you have to be on very good and open terms with the people you are sharing a property with. And you should set a who-will-use-it-when schedule.
“For example, is the intention that you’re all going to use it at the same time or are you all going to have specific weeks when you just have exclusive use?”
She says regardless of your personal relationship to the other buyers, you need think about the business side of things because you are effectively the joint property managers.
Talk about a budget.
“It may become pretty apparent pretty quickly that one party has sufficient assets to put money away regularly and another one doesn’t. You should know that before you get into it. And then you should see a real property or estates lawyer,” she says.
And set up a sort of “insurance” account.
“[Think about] what would be a reasonable amount that you invest in the cottage at an annual basis. And you may not invest that exact amount every year, but what amount are you going to put away so that when the roof goes or the plumbing goes, or whatever, you’ve got a bit of a buffer.”
And although it may seem uptight and unnecessary when you’re among friends or family, Cauwenberghe really recommends setting up the purchase with opportunities to buy out other investors.
“You need to make sure that there’s something down in writing so that if something really bad happens–someone gets divorced or someone passes away–you can buy parties out and you don’t have to start dealing with their surviving spouse or their kids or someone you didn’t necessarily intend to co-own with.”
