Pros
- Enter the property market faster. In Australia’s expensive property market, co-buying with your parents may be the only way that some young Australians can realise their property dreams.
- Increase your buying power. By using the equity in your parents’ home and sharing the repayments, you can afford to think bigger when choosing your first home.
- Borrow less. By teaming up with your parents you could borrow less money, shrinking your loan size and making repayments more affordable.
- Share the responsibility. Sharing the responsibility of loan repayments with your parents takes some of the anxiety out of the situation and means that you have a safety net if you get into financial difficulty.
I have permanent residency my parents are coming out on an 870 visa ( they are awaiting their 173/143 visa to be processed) can I help them buy a property as tenants in common 30:70 & how will that affect the stamp duty ?
Hi Nickjac,
This is quite a complicated situation, and the answer depends on a number of factors including which state or territory you’re buying in, as each one has different rules around stamp duty rates and foreign owner rates. Your best bet is to call the Office of State Revenue in the state/territory you live in and call them for clear advice based on your specific circumstances.
All the best!
Sarah
My parents would like to buy a house for me from oversea. What documents and criteria required for them to be able to pay money directly to the seller? or they just need a contract?
Hi Kelvin,
Are your parents Australian residents or citizens? If not, buying a property in Australia will be a little more complicated. They will have to get approval from the Foreign Investment Review Board.
When buying a property in Australia, the first step is to sign the contract between the seller and the buyer. You should also engage a conveyancer to check the paperwork. Then a deposit is usually paid via bank transfer to the seller (or a trust account set up by the real estate agent). Then there is usually a period of 30 to 90 days before settlement, where ownership is officially transferred and the rest of the money is paid by the buyer (and the lender, if there is a loan).
If your parents wish to pay the full price for the property, then no lender or loan is involved. You could talk to the seller and their real estate agent to organise the money transfer at settlement. And you will definitely need a conveyancer.
I hope this helps.
Kind regards,
Richard
I am retired. If I become a co owner will I still get my pension?
Hi Yvonne,
Generally, your home is not counted as an asset when calculating pension or payment, but it does affect how your pension or payment is assessed under the assets test.
If you are a homeowner your asset value limit is lower than someone who does not own their residence. The asset value limit is the amount of assets a person can own before their pension or payment will reduce from the maximum rate under the assets test.
I hope this helps!
Cheers,
Richard
You say “If you are buying a house with your parents, both you and your parents will be listed on the property title.”
What happens if you’re tenant in common with a mortgage, but you’re not on the title?
Hi Nat,
If your name is on the mortgage, but not the deed, this means that you are not an owner of the property. You are simply a co-signer on the mortgage and are obligated to pay the payments on the loan, but you don’t legally own a share of the property.
If you want your name added to the deed, you should speak with your co-signer on the mortgage and come to a decision. You can then work through the process of officially adding your name to the title. The regulations, fees and forms needed to transfer a deed or remove a name differ by state and territory. Visit our Property Title guide to check the links by state.
I hope this helps!
Cheers,
Sarah
My parents are moving in to my home and selling theirs as need full time care. I have a big mortgage so what effects are their if they buy out my mortgage as co owners? We need to extend and renovate for them to live with me. If they do they will still have over a $1 m bank balance so pension may be affected?
Hi Mike,
Thanks for your inquiry
If you’re co-buying a home with your parents, they would typically use the equity in their current home to improve your borrowing power and the cost of repaying the loan would be shared between the two of you. However, if either you or your parents fall behind on repayments, the other party is responsible for covering their share.
Before you enter into a co-ownership agreement, make sure you get advice from a solicitor or conveyancer. This will ensure that you know exactly what you’re getting yourself into and what you need to do to protect yourself from potential risk.
Hope this information helps
Cheers,
Arnold