Owning a house is a decision that has to be backed by strategic measures and plans. Most people are under the erroneous impression that making a huge down payment is a prerequisite before going into the market. While it is without any qualms that this can work at times, it more often than not does not work. The consistent payment of rent coupled with the escalating prices of houses hinders a huge down payment. Another mitigating factor is the high-interest rate. Therefore, a moderate down payment is all that is required to enter the market.
The prices of houses should not be the major deciding factor, as Petter Wetherell, an estate agent from Mayfair said in a recent interview. This is evident in the fact that the spirit of most buyers is brought down by the cheap prices of single-family detached homes as they have a preconceived notion that home-ownership is way below their level. As the adage goes “do not despise humble beginnings”, it is very important to start from a moderate level and rise through the ranks, knowing very well your financial wherewithal. This will be a bold step in your quest to build equity.
In a market flooded by fluctuating and skyrocketing prices, it will be a mistake on the part of the buyer to get virtually everything in place in the first home. Make sure that the requirements satisfy the current needs and do not encompass any future needs as this tends to decrease the total cost while acting as catalysts to the equity building process. There will certainly be enough equity that has accumulated when the time comes for any upgrade whatsoever, and therefore monies can be channeled in that direction.
A partnership can also be inculcated to expedite action on the building of equity. Co-ownership with family and friends will definitely be a step in the right direction if one realizes that he or she is cash-strapped to enter the market and make a meaningful impact. Partnerships of this nature should not in any way be underestimated and should be backed by stringent laws that clearly spells out the nitty-gritty of the agreement with no ambiguity whatsoever. This means that a seasoned lawyer should be brought on board who will be responsible for the planning of the agreement and establishing the buy-out conditions in the event that one of the partners backs out of the entire partnership agreement. It takes a lawyer with enormous foresight to execute such a task.
Since the money invested by the partners will not be the same, it becomes essential to institute rules that bind and protect the agreement in the future, especially when it becomes necessary to sell the property. This will ensure that each partner is treated fairly based on the amount of money invested and will curtail any legal wrangling in the future. A strong and solid legal agreement is required to spearhead, speed up and add some decorum to the entire partnership. It should not be considered as a setback or a hitch to the partnership, but a foundation for a healthy partnership and a means to peaceful coexistence between partners.