Two-thirds of homebuyers are prepared to pool their resources with friends and family in order to raise the deposit, new research has found.
According to the latest First Homeowners Survey released by mortgage broker Mortgage Choice, 66 per cent of respondent buyers pooled their resources with another in some way.
Of those buyers, 60 per cent purchased with their partner while 3 per cent entered into a co-ownership agreement with a family member, friend or work colleague. Just over 2 per cent bought using a monetary gift provided by parents or with their parents acting as guarantor on the loan and 1 per cent said they did so with someone other than a friend, family or colleague.
Mortgage Choice senior corporate affairs manager Kristy Sheppard said these arrangements enable borrowers to share the financial and emotional responsibility of long-term debt with another so, together, all parties enter the market sooner.
"Property co-ownership offers buyers a quicker fix, albeit one that needs to be examined from all angles and executed with great care", she said.
"Sharing mortgage commitments with one or more people not only helps borrowers buy sooner but it can also ease the challenge of applying for a home loan.
"The majority of lenders now require borrowers to contribute at least 5 per cent to 10 per cent of the property purchase price, with much of that needing to come from genuine savings.
"Combining funds with another increases the deposit amount and often helps buyers to enter the market with greater borrowing capacity.
Ms Sheppard warned however, that entering into a financial commitment with another person can put considerable strain on a relationship regardless of how strong it has been in the past.
For this reason it is important to seek independent legal and financial advice prior to signing a co-ownership agreement, loan contract or property purchase contract. All parties must fully understand their rights and obligations as well as the plans each participant has for the property and their loan repayment strategy.
"No matter who you intend to purchase with, organising finance should be a well thought-out decision", Ms Sheppard advises.
"Choosing a loan type and lender suited to your unique situation, with all the flexibility and features you and your co-owner/s need, may save you time off your loan term and interest off your loan amount."