Comments on: Million-dollar thought experiment

By: Eric Faller

Eric Faller — Thu, 31 Jul 2008 20:11:08 +0000

I wasn’t able to find 2 other people yet. All my friends are bums.

Actually I was talking to someone who said that you can’t split the mortgage 3 ways – each person would have to individually qualify for the $1 million mortgage, which obviously wouldn’t work. I’m trying to figure out who is right (maybe the Wikipedia info only applies to the UK).

By: S

Thu, 31 Jul 2008 20:05:23 +0000

Did you find your 2 other people yet . I’d love to move into that house

By: Angela

Angela — Wed, 30 Jul 2008 05:05:03 +0000

Wow those homes are awesome! But what would happen when you got married?

By: Eric Faller

Eric Faller — Tue, 22 Jul 2008 17:56:06 +0000

Yes, I agree. I think that finding roommates who are decent people and will be able to live there for several years would be the most difficult part of the idea, and probably would be why it won’t work in practice. Hmm..

By: Serena

Serena — Tue, 22 Jul 2008 17:39:43 +0000

Hi, Eric! I’m all for buying over renting. But (aside from the additional expenses part) I think I’d have a hard time finding three friends I’d want to live with. It’s not like you’d be sharing a dorm room or apartment that you’d know you’re eventually going to abandon. It’s a investment that everyone would have to agree to keep up and keep up for a specific period of time. I mean, what do you do if you or one of the co-owners wants to move (due to work or love or whatever)…how could you sell one third of the house? What do you do if you have a co-owner who is a jerk and scratches up that beautiful hardwood floor? Is he solely responsible for fixing it? How do you prove it? Sooooo…I think YOU could buy, maybe not a million dollar home, but something really nice, and not have to worry about the roomies. That’s what I did! Love it (except for the HOA fees…)Good luck!

By: Savraj

Savraj — Fri, 18 Jul 2008 14:08:29 +0000

The 100k downpayments and the coordination of three independent, unmarried people is all you have going against you. If you can get people to agree, sounds like an awesome plan. Just imagine the parties.

By: SKO!

SKO! — Wed, 16 Jul 2008 16:07:24 +0000

I’m not gonna shoot down your idea. I’m a fan of it.

By: Jason

Jason — Wed, 16 Jul 2008 13:10:43 +0000

According to Redfin, the property taxes are $10,617/yr and homeowners insurance would be roughly $6,000/yr. If three people live in the house, taxes and insurance would be $461.58/person/month (in addition to the mortgage payment). Also, a lender might be a little nervous about a set up like this since none of the tenants are married. I’m in the process of buying a house with my fiancee and we had to do some extra paperwork because we weren’t technically married yet. But, with such a large down payment, there are some ways around it.

By: Eric Faller

Eric Faller — Wed, 16 Jul 2008 06:46:19 +0000

You’re probably right – maintenance, upkeep, and that kind of stuff probably add up pretty quick. But on the other hand, you’d still only have to pay 1/3 of those costs so they might not be too bad.

And yeah, finding a group of people who all like each other and can make 100K down payments might be difficult.. hmm..

By: Tony

Tony — Wed, 16 Jul 2008 06:46:00 +0000

I don’t think you’re leaving anything out, except that you may be underestimating property tax, insurance, utilities, and upkeep costs on a place like that. I also imagine it might be harder to get a good loan if ownership is split, but with $100k downpayments, it can’t be too hard.

I imagine the reason it doesn’t happen more often is the lack of a group of people who want to live together and can afford to make $100,000 down-payments.

Cooperative housing has quite a few adherents, which seems similar.