Greenleaf Property Developers

Due to inflation and the high costs of property an increasing number of buyers are pooling resources with friends, family or likeminded investors in order get a foothold in the market.

ERA Cape Town estate agent Gavin Zinn said there had been and "enormous" increase in the number of people buying houses as a joint venture over the last two years.

Zinn said it was a "survival mechanism" to beat high living costs, and due to the fact that property costs had "gone through the roof" in recent years, people in the middle income market could no longer afford to buy property on an individual basis.

While joint ownership was a solution to the problem, he warned that there were problems when purchasing as a collective. Because the purchasers were "jointly and severally liable", banks would expect cost to be met regardless of whether one person defaulted or even died.

Additionally, if there was no clear understanding of roles and responsibilities, things could "get messy", particularly if the collective owners lived in the house together, or if one wanted to sell and others did not.

Rawson's Property national operations manager Vivienne Ferguson said they had also seen an increase in joint buyers as the current 15.5% interest rate led to repayments beyond most people's budget.

One such joint purchaser is Kerry Seton-Rodgers, who bought a Woodstock house in 2003 with her boyfriend and his sister. Seton-Rodgers said property prices had risen to a point where even people with "good" salaries battled to afford a house in a decent area, but by combining earnings in a collective, a larger bond could be obtained.

Using the collective buying model, she said she and her boyfriend were able to buy a house to live in, as well as invest in another Woodstock property with other family members three years later, and has plans to jointly invest in a third property later this year.

Seton-Rodgers said there were challenges when buying together with others, as while guidelines and rules could be agreed upon, there also a need for a level of trust. She said before the first property was bought in 2003, legal arrangements were made and contracts signed to avoid future conflicts. By Brenda Nkuna