Property ownership requires a significant investment of time, effort, and money, so buying a house with friends has proved an attractive option for people eager to get on the property ladder but without the resources to go it alone.

But it also comes with disadvantages. For instance, joining forces to buy a house with a friend or relative also means that you could be responsible for the entire mortgage if the other person defaults.

With these issues in mind, this article breaks down the pros and cons, implications, and key questions to address before considering whether to buy a house with a friend so you can decide whether it’s the right move for you.

### Reasons you might decide to buy a house with friends

The primary reason to consider buying a property with one or more friends is affordability.

Simply put, dividing a property purchase between two (or more) people works out cheaper for each person than for one buyer to pay the full price alone.

That remains the case whether the buyers intend to live in the house or they plan to act as landlords and let the property out to renters. 

Additionally, buyers without a spouse or partner may see purchasing with a friend or sibling as the most sensible way to share the cost of home ownership.

### How to decide if buying with a friend is a good idea

Everyone’s situation is different, but creating a pros and cons list can help you decide whether buying a house with a friend is the right choice for you.

### Pros to buying a home with friends

* It makes the deposit, maintenance costs, and mortgage more affordable.

* It’s easier to share the financial burden of a new property with a co-owner than with a tenant, in case you’d planned otherwise to rent out a room to make your mortgage payments.

* Living together with a friend can be more sociable than living alone in case you’re planning to live in the property together. This could be especially relevant if you’re accustomed to living with flatmates.

### Cons of buying a home with friends

* While paying for a mortgage with two people may initially seem easier, the lender will use the credit reports of both of you to decide whether to accept your mortgage application. As a result, one person’s bad credit can negatively affect the mortgage terms for both of you.

* Forming a financial partnership can strain a friendship. Your otherwise happy and carefree relationship could suffer if, for instance, the other person begins missing mortgage payments.

* Tying your financial life -- including your credit score -- to a person who may not share the same goals as you could prove a risky proposition.

### Sharing a mortgage with a friend

You can seek out a joint mortgage if you’re planning to buy a property with a friend or group.

[Read more on GetAgent’s blog: What you need to know about joint property ownership](https://www.getagent.co.uk/blog/first-time-sellers/joint-ownership-property)

Joint mortgages are most common with couples but that doesn’t necessarily need to be the case.

In fact, you can apply for a joint mortgage if you plan to:

* buy a property with one or more friends or relatives who you intend to live with

* buy a property with a friend or relative who’s contributing money as an investment or who wants to help you afford the property

* buy a property with a business partner

But your joint mortgage will only be as strong as your weakest link. If one person has a poor credit score, for instance, that will adversely affect your rates -- and whether you can get a mortgage at all.

### Tenancy in common versus a joint tenancy agreements

When buying a house with a friend, you’ll need to decide how the property is going to be owned.

In the UK, that typically means choosing between either a tenants in common or a joint tenants agreement.

In a tenancy in common, each party owns a particular share of the property, usually based on how much money they’ve contributed. The shares could be split evenly or not. For example, one person could own a 70% share compared to the other person’s 30% share. 

A tenancy in common is probably the more likely choice for friends who are buying a house together.

On the other hand, a joint tenancy is the usual choice for married couples and civil partnerships. In joint tenancies, the buyers own the entire property together. It’s irrelevant how much money each person has contributed towards the purchase -- the property will always be owned in equal shares.

[Read more on GetAgent’s blog: What to consider when buying a house as a couple](https://www.getagent.co.uk/blog/properties/buying-house-couple)

### Questions to ask each other

Buying property with a partner, whether a spouse or not, can be more straightforward in some ways because you’ve probably discussed long-term life plans.

That’s not necessarily the case with your friends, however.

As a result, before buying a house with a friend it’s a good idea to sit down and address the following questions together. It’s an even better idea to write down and keep your agreed-upon answers someplace secure.

* Will current or future romantic partners be allowed to move in?

* What will happen if one person wants to sell their share or change the agreement?

* How will mortgage payments be made if one person loses their job or otherwise has a change in financial circumstances?

* What happens if you stop getting along? Will one person move out? If so, will that affect the mortgage payments?

### Planning financial matters together

You’ll also need to create a plan for jointly handling the business affairs side of property ownership.

Co-owning a house means that you will both be financially invested in ensuring that your relationship endures and that your property is cared for. Your credit scores will also be connected for the foreseeable future, so you’ll both have incentives to handle your financial affairs responsibly.

Having a structure in place *before* any problems or disputes arise should help reduce -- though you can never fully eliminate -- potential sources of friction.

Key responsibilities include:

* deposit arrangements

* mortgage payments

* building insurance

* council tax and other bills

* costs for unexpected repairs

### What it means for sales and inheritance

Owning a home with a friend also has implications if a time comes when the interests of the co-owners diverge.

For example, if one person wants to sell but the other doesn’t, then the person seeking the sale needs to apply to a court to force the sale. The court considers the personal and financial situations of the co-owners, as well as how any sale would affect any dependents living in the house, such as children or elderly relatives, before deciding whether to allow the sale to go ahead.

There could also be implications for inheritance.

If you’ve chosen a tenancy in common, which is the more likely route for friends, you can gift your share of the property in your will to whomever you choose.

But if you’ve chosen a joint tenancy, the property goes to the surviving owner (or owners) when one person dies. Unfortunately, this could result in an [inheritance tax](https://www.gov.uk/inheritance-tax/passing-on-home) bill if you’re not married or in a civil partnership with your joint co-owner.

### Final tip

Ultimately, perhaps the biggest non-financial factor is the nature of your friendship with your potential co-buyer.

Deciding whether they’re the right person to join you in what is probably the biggest financial decision of your life isn’t to be taken lightly. Consider:

* How strong is your friendship?

* How long have you known each other?

* How compatible are your decision-making styles?

* Do you have comparable tolerance for risk on financial matters?

two friends with excited expressions and colourful jumpers lie on a rug 

buying-house-with-friends

Property ownership requires a significant investment of time, effort, and money, so buying a house with friends has proved an attractive option for people eager to get on the property ladder but without the resources to go it alone.

Buying a house with friends: The pros and cons

Buying a house with a friend: Is it right for you?

### What is Stamp Duty Land Tax (SDLT)?

Stamp Duty is the tax that's paid when you purchase a residential property in England or NI. 

There are standard rates, which apply to all residential transactions, then there are additional surcharges for particular types of property purchases, for example: second homes, or buying a property from overseas. The amount of tax you pay is calculated as a percentage of the sale price. 

In this article we'll look at the Stamp Duty rules for non UK residents: how much it is, what defines a 'non-resident', and how you can reduce the amount you'll need to pay. 

**Note:** There are different rules for non-residents buying homes in Scotland & Wales. These areas have their own types of property tax. 

### What is a non-UK resident?

'Non UK resident' refers to someone who is not resident in the UK. A non UK resident refers to anyone who spends most of the year living overseas, whether they were born in the UK or not. 

When it comes to calculating how much Stamp Duty you'll need to pay, 'non-resident' has a specific definition. 

To be classed as a resident you'll have to prove that you stayed in the UK for at least 183 days during the 12 months before the purchase is finalised.  You can stay anywhere in the UK for these days - not just England or Northern Ireland. 

If you're you're married or in a civil partnership, only one person from the couple is required to stay in the UK for the set 183 days before the purchase for you both to be classed as UK residents. 

If you don't spend the minimum 183 days in the UK during this period you'll be treated as a non UK resident; regardless of your nationality, citizenship, or any 'right to reside in the UK' status you may have been granted in another context (eg. a visa). 

There are some separate residency rules for non UK resident corporate buyers of residential property. You can check them out in full [here](https://www.gov.uk/guidance/rates-of-stamp-duty-land-tax-for-non-uk-residents). 

### How do you prove that you meet the UK resident criteria?

If there's some uncertainty about whether you're a UK resident or a non UK resident you may be asked to provide evidence from the last 12 months. This can include things like:

* **Credit card & bank statements**

Statements will often show patterns of spending depending on where you are. For example: if you're living in London, it's likely that tube transport or local supermarket shops will frequently appear on your statement. Bank and credit card statements will also show if you've purchased flights to another country. 

* **Work diaries or time sheets**

If you travel a lot for work, your company diaries or time sheets can be a good indicator of where you're currently residing. They'll show where you're having meetings, and when you'll next be travelling for work. 

* **Mobile phone usage**

Providing evidence of mobile phone usage is a very easy way to show whether you're a UK resident or not. It'll be clear which countries you've resided in based on the phone networks you've used to make calls, access the internet, or send messages. 

* **Utility bills**

General overheads like utility bills can provide a general picture of how often you stay in a certain place. 

* **Membership based activities**

Using gyms, libraries, and other membership based venues regularly will demonstrate that you are spending time in a certain place, and can be good proof of your residency status. 

This information should be able to provide a clear picture of where you were staying during the 12 months leading up to the property purchase. However, the HMRC reserves the right to request additional specific information and evidence should it be required. 

### Do non UK residents have to pay Stamp Duty?

Yes, if a non UK resident buys a property in either England or Northern Ireland, they'll be required to pay Stamp Duty Land Tax.  In most cases, they'll also need to pay the non resident SDLT surcharge. 

**Note:** There are different rules for non residents looking to buy properties in Scotland and Wales. These areas of the UK do not collect Stamp Duty. They have their own property transaction taxes: LTT and LBTT. 

### How much is Stamp Duty for non UK residents?

On the 1 April 2021 new Stamp Duty rules were introduced for non residents buying residential property in England and Northern Ireland. Those who are classed as non resident have to pay a 2% surcharge on top of the standard stamp duty tax rates. 

If this is your first residential property you'll therefore have to pay the following: 

**Up to £125,000: 2%**

**The portion between £125,001 -£250,000: 4%**

**The portion between £250,001 - £925,000: 7%**

**The portion between £925,000 - £1,500,000: 12%**

**The portion over £1,500,000: 14%**

**Note:** *There is temporary relief on Stamp Duty for residential properties under £500,000. These rates will be in place until June, when they will enter a transitionary period, before returning to the normal rates in October 2021. This means you will pay less Stamp Duty than normal if you purchase your home before October 2021. For full details of the Stamp Duty holiday [head here](https://www.gov.uk/guidance/stamp-duty-land-tax-temporary-reduced-rates). The 2% non resident surcharge will still apply.* 

The surcharge applies on top of all other residential rates of Stamp Duty. So, if you're purchasing a second home, or buy-to-let property you'll have to pay **both** the non UK resident surcharge, *and* the Additional Dwellings surcharge. For these types of transactions you'll have to pay the following amounts in Stamp Duty: 

**Up to £250,000: 5%** 

**The portion between £250,001 - £925,000: 10%**

**The portion between £925,000 - £1,500,000: 15%** 

**The portion over £1,500,000: 17%**

The non resident stamp duty land tax surcharge applies whether you're buying a freehold or leasehold, as long as the property is worth over £40,000, and there's over 7 years left on the lease.

If you are planning to stay full time (or over half the year) in the UK once you've bought the property, you may be able to apply for a refund of the extra 2% surcharge. 

### Can you reduce the amount of Stamp Duty you have to pay?

In most cases you'll have to pay the surcharge if your a non uk resident. However, there are a few instances where you won't need to pay the extra charge. 

For example: 

* **Buying a mixed use property**

You don't have to pay the non-resident surcharge if the property you're buying is mixed use, for example a shop with a flat above it. 

* **Buying purpose built student accommodation**

Like with mixed-use properties, purpose-built student accommodation is not subject to the non UK resident stamp duty surcharge. However, if you plan to rent the property out, you're likely to have to pay the relevant 'higher rate' Stamp Duty. [You can read more about this here](https://www.gov.uk/guidance/stamp-duty-land-tax-buying-an-additional-residential-property). 

* **If you're in 'Crown employment'**

'Crown employment' refers to anyone working directly for the UK Government or the Royal Family. This could for example: be in the army, as a civil servant, or diplomat. Any days you're working overseas for the 'Crown' are counted towards your residency eligibility.

If you don't fall into these categories, it's likely that you'll have to pay the 2% surcharge on top of the standard Stamp Duty rates. However, you may be able to **apply for a refund.** 

If you can pass the Stamp Duty residence test within 12 months of buying the property, you'll be eligible to claim a refund on the 2% surcharge you paid upfront. You can meet this requirement by staying in the UK for at least 183 days during any 365 day period that falls within period starting 364 days before, and ending 365 days after the official completion of your property purchase. 

If you're buying the property with someone else, you'll both have to pass the residence test to apply for a refund. However, the period of time you spend in residency of the UK doesn't have to be the same. 

To apply for a refund, you'll need to [amend your SDLT return](https://www.gov.uk/guidance/stamp-duty-land-tax-online-and-paper-returns) to demonstrate that you now fulfil the residency criteria. If in doubt, ask your [conveyancer](https://www.getagent.co.uk/guide/conveyancing/what-is-conveyancing) to handle this for you. 

View over the white cliffs of Dover in the UK 

stamp-duty-non-uk-resident

In this article we'll look at the Stamp Duty rules for non UK residents: how much it is, what defines a 'non-resident', and how you can reduce the amount you'll need to pay. 

Stamp Duty for non-resident property buyers

Stamp Duty for non-UK residents: Everything you need to know

Party walls are a fact of life for many homeowners, especially those of us in flats or terraced or semi-detached houses.

But when it comes time to carry out major works involving a party wall -- which is typically a shared wall that divides the adjoining homes of two owners -- homeowners will find they’re governed by a very specific set of rules.

Whether it’s a straightforward rebuild/repair job or some other essential work, there are certain steps that homeowners need to go through:

* Provide their adjoining neighbour (or neighbours) with a **party wall notice**.
* Then, if the neighbour agrees to the works plan, both will sign a **party wall agreement**.
* If the neighbour fails to respond to the homeowner’s party wall notice or otherwise doesn’t agree to the plan, both parties will need to appoint solicitors, who will draw up a **party wall award**.

This is a fairly complex legal area, so homeowners need to learn when a party wall agreement is required, what goes into such an agreement, and how to ensure they’re legally protected before starting any renovations.

### What is a party wall agreement?

Party wall agreements are legal agreements reached between you and your neighbour about building work that might affect your shared wall (or walls) or boundaries.

By definition, party walls also include party fence walls, which stand on the land of two owners but aren’t part of a building, and party structures, which include a floor partition between two flats.

Party wall agreements are intended to ensure that one neighbour doesn’t do any renovations that undermine the structural integrity of any shared walls or adjoining properties.

The hope is that your agreement will nip any potential disputes in the bud before they arise -- and that the work is carried out legally, fairly, and safely.

Your neighbours can’t prevent you from carrying out changes to your property that are consistent with the law. However, they can affect when and how the works are done.

### When do you need a party wall agreement?

[You must tell your neighbour](https://www.gov.uk/party-walls-building-works/work-tell-your-neighbour-about) if your plans include:

* Building on or at the boundary of the adjoining properties
* Working on a party wall or party structure
* Digging below and near the foundation level of your neighbour’s property (within three or six metres, depending on the new foundations)

In practice, common works that require a party wall agreement include:

* Rear extensions
* Loft conversions
* Basement extensions
* Chimney removals
* Garden boundary wall renovations
* Damp-proof courses
* New foundations

[Read more: What you need to know about loft conversions](https://www.getagent.co.uk/blog/diy/loft-conversion-guide)

### When do I not need a party wall agreement?

On the other hand, you probably won’t need to go through the whole party wall agreement process when undertaking relatively minor works, such as:

* Drilling into the party wall internally to fit kitchen units or bookshelves
* Plastering (or replastering) a wall
* Wallpapering
* Adding/replacing electrical wiring or sockets 

Party wall agreements fall under the [1996 Party Wall Act](https://www.gov.uk/guidance/party-wall-etc-act-1996-guidance), which is worth reading if you’re considering a big building work.

[Read more: DIY tips to add value to your home](https://www.getagent.co.uk/blog/diy)

### When do I need to issue a party wall notice?

It’s a good idea to begin the process by talking with your neighbour before presenting them with written notice about your plans.

A friendly chat over a cup of tea could go a long way towards ensuring there are no misunderstandings, generating good will, and hopefully making sure the subsequent legal agreement is quickly signed.

Regardless, you need to serve written legal notice to the owners of the adjoining home with which you share a party wall (as well as any other buildings affected by your proposed works) at least two months prior to starting work.

This is called a party wall notice.

You don’t need planning permission to serve a party wall notice, though once you’ve served notice you have up to a year to begin work.

Your neighbour has 14 days to respond to the party wall notice. If they give their written consent, then you’re all set: you both sign on to your party wall agreement and you can begin your work.

### What happens if my neighbour doesn’t agree to my request?

If your neighbour doesn’t respond to your party wall notice or you’re otherwise unable to reach an agreement with them on your own, then under [section 10 of the Party Wall Act](https://www.legislation.gov.uk/ukpga/1996/40/section/10) you’ll both need to appoint party wall surveyors.

The surveyors will then prepare a party wall award, which outlines the right to begin the work, how and when it will be carried out, and any other related issues.

### What should be included in a party wall notice?

In your formal written party wall notice you should include, at least:

* Your contact information
* Details of the work that you have planned, including drawings
* A start date
* An estimated finish date
* Any access requirements over your neighbour’s property that you may need (for transporting materials or equipment, for example)
* Your signature

The government offers templates [here](https://www.gov.uk/guidance/party-wall-etc-act-1996-guidance#example-letters) that you can use to help write your own personalised party wall notice.

If the two properties in question are leaseholds, then you must also give notice to the building’s owners and the other tenants.

### What should be in the party wall agreement?

If your neighbour has agreed to your plan, you can write up and sign the party wall agreement.

Your party wall agreement should address three essential areas:

* How and when your proposed works will be carried out.
* A ‘schedule of condition’. This is a record, complete with photos, of the condition of the adjoining properties before the work begins. It’s important to have documented evidence of the properties’ prior states in case of any disputes arise over the areas affected by the construction
* The ultimate project outcome, including architectural drawings. 

### How will party wall agreements impact me if I move house?

If you’re moving into a home whose previous owner had a party wall agreement with an adjoining neighbour, the 1996 Party Wall Act is not entirely clear on whether that agreement automatically transfers to you as the new homeowner.

If in doubt, however, the wisest course would be to consult with a solicitor.

If you’re just moving into a new home, then you’ll need to know whether you’ve got any shared walls, fences, or boundaries with neighbours. You should ask the estate agent whether your new neighbours have any imminent construction projects planned and if any of these projects involve your shared party walls.

Two neighbours drink a beer in a sunny garden, a wooden fence behind has bunting on it

party-wall-agreements

Party wall agreements are legal agreements reached between you and your neighbour about building work that might affect your shared wall (or walls) or boundaries.

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