Hello dear forum members,
We are currently facing the decision to buy a house together. Since this situation is not very common, there are unfortunately only a few examples online, so I really hope you can help us.
Here are some important details for better assessment:
Apartment 1:
- approx. 40% of the total living area
- Condition: in need of renovation and refurbishment (from the 1950s)
Apartment 2:
- approx. 60% of the total living area
- Condition: attic converted in 1983, upper floor move-in ready but with 80s/90s style (uPVC windows, fitted kitchen from 2008)
- Also requires renovation, but is move-in ready in contrast to Apartment 1
Plot of land:
> 2,000m³ (divided across multiple parcels), but about 90% designated as a landscape protection area on a slope and was therefore hardly considered in the purchase price according to the real estate agent
No declaration of division exists yet, but we plan to arrange this in the future
The plan was to split the living area in the purchase contract on a 60:40 basis, with the remaining areas shared equally at 50:50.
According to the notary’s feedback, this apparently isn’t possible; instead, we can only buy with a 60:40 split and additionally agree on joint usage rights. The only option would be to exclude all land parcels and then split 50:50 – which would lead to an increase in the proportional purchase price for Apartment 1.
The 50:50 division was intended as compensation for not ordering an appraiser to assess the lower value of Apartment 1, strictly dividing the purchase price based on living space. For various reasons, time is pressing, so the purchase and financing should be completed as soon as possible. The notary appointment is already arranged, and financing is joint and several.
A fair process is our top priority. Therefore, our questions are:
- In your opinion, does the condition of the apartment weigh heavily, or do you see a pure division based on living area as correct?
- Do you think it is appropriate to divide the entire plot area according to 60:40, even though it was hardly considered? Should a different price per square meter then be applied?
- What other ideas do you have?
Thank you in advance for your assessments. We are really struggling.
We are currently facing the decision to buy a house together. Since this situation is not very common, there are unfortunately only a few examples online, so I really hope you can help us.
Here are some important details for better assessment:
Apartment 1:
- approx. 40% of the total living area
- Condition: in need of renovation and refurbishment (from the 1950s)
Apartment 2:
- approx. 60% of the total living area
- Condition: attic converted in 1983, upper floor move-in ready but with 80s/90s style (uPVC windows, fitted kitchen from 2008)
- Also requires renovation, but is move-in ready in contrast to Apartment 1
Plot of land:
> 2,000m³ (divided across multiple parcels), but about 90% designated as a landscape protection area on a slope and was therefore hardly considered in the purchase price according to the real estate agent
No declaration of division exists yet, but we plan to arrange this in the future
The plan was to split the living area in the purchase contract on a 60:40 basis, with the remaining areas shared equally at 50:50.
According to the notary’s feedback, this apparently isn’t possible; instead, we can only buy with a 60:40 split and additionally agree on joint usage rights. The only option would be to exclude all land parcels and then split 50:50 – which would lead to an increase in the proportional purchase price for Apartment 1.
The 50:50 division was intended as compensation for not ordering an appraiser to assess the lower value of Apartment 1, strictly dividing the purchase price based on living space. For various reasons, time is pressing, so the purchase and financing should be completed as soon as possible. The notary appointment is already arranged, and financing is joint and several.
A fair process is our top priority. Therefore, our questions are:
- In your opinion, does the condition of the apartment weigh heavily, or do you see a pure division based on living area as correct?
- Do you think it is appropriate to divide the entire plot area according to 60:40, even though it was hardly considered? Should a different price per square meter then be applied?
- What other ideas do you have?
Thank you in advance for your assessments. We are really struggling.
N
Neuling20211 Mar 2021 19:05Ysop*** schrieb:
I agree with Pagoni. You write that you are aware of the risk. By that, you mean you have heard that things can go wrong. Of course, that won’t happen with you ;-) If you were to consider that it could become serious, then joint liability would not be an option. Yes, there is definitely some truth to that!
W
WilderSueden1 Mar 2021 19:30The only clear solution is to have the house and land divided before purchasing. Even with different conditions, I don’t see a 60:40 division as fair. Furthermore, a subdivision agreement allows you to sell your unit at any time without depending on the other party. Once you are jointly liable, you hold each other accountable. I didn’t want that, especially not with friends. Money is a fairly reliable way to ruin friendships, so before buying, I would clearly define who is responsible for what and at what price.
Neuling2021 schrieb:
Since this situation is not very common, there are unfortunately only a few examples online, so I really hope you can help me. Because it’s something people just don’t do – the stronger the friendship, the less likely it is...
There are unwritten rules in life: this is one of them – don’t build or buy a house with friends.
There are others, too: don’t sleep with your friend’s partner, or always brush your teeth in the morning.
Believe me: any discussion about this leads nowhere!
I fully agree with all the concerns raised. I would never, under any circumstances, take joint and several liability for a project like this.
If you truly care about a fair process, an appraiser should be hired even if you are 100% in agreement. Sorry, but it is really unwise and negligent not to document the actual condition and clearly separate the values.
Neuling2021 schrieb:
For us, the 50:50 split was a compromise because we decided not to hire an appraiser to determine the lower value of apartment 1, but instead to divide the purchase price strictly according to living space.
[..]
A fair process is our highest priority.
If you truly care about a fair process, an appraiser should be hired even if you are 100% in agreement. Sorry, but it is really unwise and negligent not to document the actual condition and clearly separate the values.
The project is only fair and legally clean for both parties if you invest at least a few days before going to the notary.
1. Obtain the certificate of isolation from the authorities (through the current owner).
2. Prepare the division declaration (there are even templates available online, including the community rules).
3. Schedule the notary appointment and notarize the purchase or the division declaration.
Beforehand, you can carefully consider who is entitled to what at which price, depending on special usage rights for the property, the living area, and the condition of the apartments.
As a real estate banker, I would never handle anything else. Joint liability is problematic. Fractional ownership is also complicated – banks will not finance it, so it is out of the question (unless you all jointly guarantee everything again).
An alternative, if you want to proceed quickly with the purchase, is that one party buys alone. The division can take place afterward. But only if this is possible for you in terms of financing.
1. Obtain the certificate of isolation from the authorities (through the current owner).
2. Prepare the division declaration (there are even templates available online, including the community rules).
3. Schedule the notary appointment and notarize the purchase or the division declaration.
Beforehand, you can carefully consider who is entitled to what at which price, depending on special usage rights for the property, the living area, and the condition of the apartments.
As a real estate banker, I would never handle anything else. Joint liability is problematic. Fractional ownership is also complicated – banks will not finance it, so it is out of the question (unless you all jointly guarantee everything again).
An alternative, if you want to proceed quickly with the purchase, is that one party buys alone. The division can take place afterward. But only if this is possible for you in terms of financing.