More than half of prospective home buyers in the UK now apply for mortgages jointly, with the share rising from 49% in 2021 to 53% in 2024. That shift tells you something important: buying a home with someone other than a spouse or partner is becoming the norm, not the exception. I’ve been watching this trend for a while, and what I notice most is how often people jump into these arrangements without a formal agreement in place.
Affordability pressures are the biggest driver here — 60% of young buyers cite them as the reason they’d consider a non-traditional purchase. But pooling money with a friend or family member creates a financial relationship that needs clear rules. Without a co-ownership agreement, you’re essentially trusting that nothing will go wrong — and life has a way of proving that assumption wrong. Here’s what you actually need to know.
What a Co-Ownership Agreement Actually Does
The most important thing to understand is that a co-ownership agreement isn’t just a piece of paper — it’s the rulebook for a financial partnership that could last decades. Without one, you’re relying on the default legal framework, which may not reflect what you actually agreed. A proper co-ownership agreement covers who put in what, how ongoing costs are split, and what happens when someone wants out.
My first move if I were buying with a friend would be to get a deed of trust drawn up before exchanging contracts. It’s a relatively small upfront cost that saves enormous headaches. The key is being transparent from the start — 56% of co-buyers cite strong trust as a motivator, but trust doesn’t replace a written agreement when circumstances change.
Why Getting It Wrong Costs More Than Money
The real cost of a bad co-ownership arrangement isn’t just financial — it’s the relationship. I’ve seen friendships fracture and family tensions escalate because nobody planned for the obvious. Consider this: if you buy as joint tenants and one owner dies, their share automatically passes to the other owner, regardless of what their will says. That might be what you want, or it might be a complete surprise to their family. The difference between joint tenants and tenants in common is one of the most overlooked details in co-buying.
For example, if you and a sibling each put in £30,000 for a deposit on a £300,000 flat, but you earn more and cover 70% of the mortgage, what happens when your sibling wants to sell after two years? Without an agreement, the default legal position may not reflect your unequal contributions. A deed of trust would specify that you get your larger share back first, then split any remaining equity proportionally. That’s the kind of detail that keeps relationships intact.
Where People Go Wrong With Co-Ownership
The most common mistakes I see aren’t about bad intentions — they’re about assumptions that never get tested until it’s too late. Here are the patterns that cause the most trouble.
Assuming Equal Contributions Means Equal Ownership
This is the biggest trap. Just because you split the deposit 50/50 doesn’t mean you’ll split mortgage payments, maintenance, and improvements the same way. If one person earns more and covers a larger share of the monthly costs, their economic interest in the property grows over time. A co-ownership agreement should specify how unequal contributions are handled — whether they’re treated as loans, gifts, or adjustments to ownership shares.
Ignoring the Exit Strategy
Nearly every co-buyer I’ve spoken to assumes they’ll sell the property when one person wants out. But what if one person wants to keep it? What if they can’t afford to buy the other out? What if the property has lost value? These scenarios need to be agreed in advance. A good agreement includes a valuation mechanism, a right of first refusal, and a timeline for the buyout process. Without it, you’re looking at court to resolve a dispute that should have been a conversation.
Overlooking Service Charges and Major Repairs
In shared ownership properties, service charge increases are not capped, unlike rent. That means your monthly costs can rise unpredictably. If you’re buying with someone else, you need to agree how these variable costs are split and what happens if one person can’t pay their share. A sinking fund — a joint account for unexpected repairs — is a practical solution that too few co-owners set up.
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| Motivation for Co-Buying | Percentage of Respondents | What It Means |
|---|---|---|
| Pooling savings for deposit | 60% | Affordability is the primary driver, not preference |
| Strong trust in co-buyer | 56% | Emotional confidence, not legal protection |
| Open to buying with a friend | 24% | Significant minority willing to bypass traditional routes |
| Open to buying with a sibling | 22% | Family co-buying is a growing trend |
How to Set Up a Co-Ownership Agreement That Works
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The process isn’t complicated, but it requires discipline. Here’s the practical sequence I’d follow.
Get a Solicitor to Draft a Deed of Trust
This is non-negotiable. A solicitor who specialises in property law will draft a deed of trust that reflects your specific arrangement. The cost is typically a few hundred pounds — a fraction of what you’d spend on a dispute later. If you need to find one quickly, a property lawyer service can connect you with someone who understands co-ownership agreements. The deed should cover: each person’s initial contribution, how ongoing costs are split, how ownership shares are calculated, and the process for selling or buying out.
Choose Your Legal Structure Carefully
Joint tenants means you own the property equally and the survivor inherits automatically. Tenants in common means you can own unequal shares and leave your share to someone in your will. For most co-buyers who aren’t married, tenants in common is the better choice because it gives you flexibility. If you’re buying with a friend, you almost certainly want tenants in common so your share goes to your family, not theirs.
Plan for the Unexpected
Life changes fast. Your agreement should cover: what happens if someone loses their job and can’t pay their share, what happens if someone wants to move in a partner, what happens if the property needs major repairs, and what happens if one person dies. These aren’t morbid hypotheticals — they’re the most common triggers for disputes. A well-structured purchase plan includes these contingencies from the start.
Understand Shared Ownership Rules If Applicable
If you’re using a shared ownership scheme, the rules are different. You can buy an initial share of 10% to 75% of the property’s value and pay rent on the remainder. The Right to Shared Ownership scheme is available to tenants in new social or affordable rent homes, with income limits of £80,000 (£90,000 in London). You can staircase up to 100% ownership, but your rent only decreases as your share increases — it doesn’t disappear until you own the whole property. Service charges are a separate cost that can rise without cap, so factor that into your budget.
- 1Discuss contributions openlyBefore seeing a solicitor, agree on who’s putting in what for the deposit, mortgage, bills, and repairs. Write it down.
- 2Instruct a solicitorFind a property solicitor to draft a deed of trust. They’ll turn your verbal agreement into a legally binding document.
- 3Choose your ownership structureDecide between joint tenants and tenants in common with your solicitor’s advice. This affects inheritance and selling rights.
- 4Agree an exit strategyDefine how you’ll value the property, who gets first refusal, and the timeline for a buyout if someone wants to leave.
Frequently Asked Questions
Can I buy a house with a friend if I already own a property? ▾
What happens if my co-buyer stops paying their share of the mortgage? ▾
Is a deed of trust the same as a co-ownership agreement? ▾
Can I staircase to 100% ownership in shared ownership? ▾
What’s the difference between joint tenants and tenants in common for inheritance? ▾
Do I need a solicitor for a co-ownership agreement? ▾
The rise in co-buying is a practical response to an expensive housing market, but it only works if you treat it like the business partnership it is. A deed of trust, clear communication about contributions, and a plan for the unexpected are the difference between a smart financial move and a costly mistake. If this was useful, you might also want to read Understanding Real Estate Contingency Clauses When Buying.
Sources and Further Reading
Understanding Real Estate Agent Fees When Buying a Home — A practical guide to the costs you’ll encounter beyond the purchase price.
Tips for Buying a House Near UK Train Stations — Location considerations that affect property value and your daily commute.
Shared ownership rises thanks to family and friends. Estate Agent Today, 2026.
Shared Ownership Report. House of Commons Levelling Up, Housing and Communities Committee, 2024.
The Right to Shared Ownership: A Guide for Tenants. UK Government, 2024.
