In a recent BBC article, four long-time friends: Francesca, Graeme, Sonja and Kieran, shared their experience of buying a home together in London. Faced with soaring property prices, they pooled their resources to purchase a three-bedroom flat for £650,000, far beyond what any couple could afford alone. Their story raises an important question: could buying a home with friends be a viable solution for others struggling to get on the property ladder?
While their arrangement has worked well so far, it’s not without risk. From legal ownership structures to financial planning, buying property with friends requires careful consideration and expert legal support. In this article, we explore the pros and cons of co-buying with friends, and outline the legal steps involved to help you make an informed decision.
The Pros of Buying a Home with Friends
Increased Buying Power
Pooling incomes allows buyers to access larger properties or better locations than they could afford individually. In the case of Francesca and her friends, combining four incomes enabled them to move from a £350,000–£400,000 budget to a £650,000 property.
Shared Living Costs
Mortgage repayments, utility bills, council tax and maintenance costs can be split, easing the financial burden on each individual. This can make home ownership more sustainable, especially in high-cost areas.
Emotional and Social Benefits
Living with trusted friends can offer emotional support and a sense of community, particularly for those who have previously shared rental accommodation.
The Cons of Buying a Home with Friends — and How Legal Advice Can Help
While buying a home with friends can make property ownership more accessible, it also brings legal and personal difficulties. These risks are manageable with the right legal support.
Legal Considerations
Co-ownership requires clear agreements on how the property is held, how costs are shared, and what happens if someone wants to sell. A solicitor can draft tailored documents like a deed of trust to protect everyone’s interests.
Lifestyle Differences
Different habits and expectations can cause tension. Legal agreements can include practical arrangements for shared living and dispute resolution, helping maintain harmony.
Financial Risk
All owners are jointly liable for the mortgage. If one defaults or exits, it affects the others. A solicitor can help structure agreements to manage these risks and advise on protective measures like insurance.
Legal Structures for Co-Ownership
Joint Tenants vs Tenants in Common
When buying a home with friends, the most common ownership structures are:
- Joint Tenants: Each owner has an equal share, and if one dies, their share automatically passes to the others. This is more common among couples.
- Tenants in Common: Each person owns a specific share of the property, which can be unequal and passed on via a will. This is usually more suitable for friends.
Deed of Trust
In the BBC example, the group used a floating deed of trust. This legal document outlines how ownership is divided, how proceeds are split if the property is sold, and what happens if someone wants to leave. It’s essential for protecting each party’s interests and avoiding future disputes.
At Slater Heelis, our residential property solicitors regularly draft bespoke deeds of trust tailored to each group’s needs. We also advise on how to structure ownership to reflect contributions and responsibilities fairly.
Planning for the Future
Exit Strategies
What happens if someone wants to move out, sell their share, or stop contributing? These scenarios should be addressed in advance through:
- A cohabitation agreement or deed of trust
- Clear terms for selling or transferring ownership
- Provisions for dispute resolution
Inheritance and Tax Planning
If you’re buying as tenants in common, each person’s share can be left to a beneficiary. This has implications for Inheritance Tax, especially if the property value increases. Our full-service team can advise on tax planning and wills to ensure your wishes are respected.
Expert Legal Support for Co-Ownership
At Slater Heelis, we know that buying a home with friends can be a smart way to enter the property market, but it requires careful legal planning. Our residential property solicitors offer clear, practical advice to help you structure co-ownership arrangements, manage risks, and ensure your purchase runs smoothly.
We provide:
- Tailored deeds of trust and cohabitation agreements
- Full conveyancing services
- Support with mortgages and Stamp Duty
- Access to in-house specialists in family law and property disputes
With decades of experience and over 1,600 five-star reviews, we’re trusted by clients across the UK to deliver reliable, straightforward legal support.
Get In Touch
Zara Banday is a Partner and the Head of our Residential Property team specialising in property sales and purchases, mortgages and remortgaging, and leasehold agreements.
If you’re considering buying a home, whether with friends, family, or as an individual, contact our team today on 03330 606 853 or fill out our online contact form.
