Co-buying has crossed into the mainstream. According to a 2024 report by CoBuy, nearly 29% of U.S. home purchases this year involved co-buyers—including friends, family, partners, or small groups. In March 2025 alone, a survey showed 23% of prospective buyers said they’d consider co-buying with someone they know.
High prices, rising mortgage rates, and tight inventory continue to pressure even well-qualified buyers into exploring partnerships—with co-ownership now viewed not as a fallback, but a strategic entry into real estate.
In cities like Toronto and Los Angeles, co-ownership arrangements are becoming common among younger professionals who are priced out of solo ownership.
Why People Are Doing It
Affordability is the obvious driver. A joint purchase lowers the barrier to entry—less money up front, less risk individually. But there’s more to it. Co-buyers can qualify for better locations, invest in income properties together, or split the burden of a second home.
It also aligns with shifting lifestyle priorities. Many Millennials and Gen Z buyers are delaying marriage or choosing to invest with friends instead. In places like London or New York, owning even a studio apartment solo can feel out of reach—co-ownership offers a workaround.
What Can Go Wrong
Not all partnerships are built to last—especially when real estate and money are involved.
“We went into it as best friends,” said Carla M., who bought a condo with her college roommate in 2021. “But when she lost her job and couldn’t keep up with her half of the mortgage, things spiraled fast. We had no formal agreement—just trust. I ended up covering the full mortgage for six months and it nearly ruined our friendship.”
- Disputes over finances or responsibilities can fracture relationships.
- Job changes, relocations, or new partners can complicate shared living or investment plans.
- Exits aren’t always clean—one party may want to sell when the other doesn’t.
- Missed payments by one party can damage everyone’s credit, especially if both names are on the mortgage.
Even with the best intentions, poorly defined terms can turn a smart idea into a legal and financial headache.
Not all partnerships are built to last—especially when real estate and money are involved.
- Disputes over finances or responsibilities can fracture relationships.
- Job changes, relocations, or new partners can complicate shared living or investment plans.
- Exits aren’t always clean—one party may want to sell when the other doesn’t.
- Missed payments by one party can damage everyone’s credit, especially if both names are on the mortgage.
Even with the best intentions, poorly defined terms can turn a smart idea into a legal and financial headache.
The Legal (and Emotional) Reality
Co-owning real estate without a written agreement is a gamble. Real estate lawyers increasingly advise buyers to treat even family investments as business partnerships.
That means:
- Defining ownership percentages
- Laying out who pays what (mortgage, taxes, repairs)
- Setting rules for refinancing, renting out the property, or selling
- Agreeing on a clear exit strategy before the purchase is made
Many also choose to co-own through a limited liability company (LLC) or tenancy-in-common agreement. These legal structures help separate personal and property liabilities—and simplify ownership transfers later on.
Real-Life Scenarios
In Los Angeles, three friends pooled €300,000 in late 2022 to purchase a €900,000 duplex. One moved into the lower unit while the other two rented out the upstairs to cover their mortgage. Things ran smoothly for about a year—until one partner lost his tech job in early 2024. He couldn’t make his €1,200 monthly contribution, and the others were forced to refinance. They ultimately sold the property six months later at a €15,000 loss.
In Austin, a group of four friends purchased a €500,000 lakeside vacation home in 2023. They contributed equal shares—€125,000 each—and rotated personal use. One member managed bookings for short-term rentals, which covered most operating costs. They signed a five-year agreement detailing responsibilities and a clause allowing for a buyout if anyone wanted out. As of mid-2025, the arrangement is still in place—and profitable, thanks to steady rental demand.
In Los Angeles, three friends pooled €300,000 for a duplex, with one living in one unit and the others renting theirs out. The deal worked—until one of them lost his job. Unable to cover his share, the group scrambled to refinance and eventually sold early at a loss.
In Austin, a group bought a vacation home near the lake. They agreed to use it part-time and rent it the rest of the year. One partner took on guest coordination; another handled finances. It worked—because they drafted a clear, signed agreement first.
Should You Do It?
Only if the structure is right.
Co-buying works best when:
- Everyone contributes equitably (in money, time, or management)
- Roles and responsibilities are spelled out in writing
- You’ve agreed on how to get out—before you even get in
And no, it’s not just about legal risk. Emotional fallout from a failed co-investment can outlast the financial impact.
Bottom Line: Co-investing with friends or family isn’t a shortcut—it’s a serious commitment.
Pros:
- Shared financial burden
- Access to better properties or markets
- Combined skills and responsibilities
Cons:
- Potential for strained relationships
- Legal and financial complications
- Difficult exit strategies
If you’re considering this path, don’t just shake hands—get it in writing. Talk to a lawyer, draft a clear agreement, and make sure your personal goals align. With the right groundwork, shared ownership can be more than a workaround—it can be a smart strategy.
