We’ve fallen in love with a house that is not currently for sale. Is there anything we can do? – SMITTEN
DEAR SMITTEN: I’ve seen this situation come up many times, both with residential buyers and investors. If you have your eye on a specific property, approaching the owner “out of the blue” might seem like a long shot — but if you don’t ask, you’ll never know if they might be willing to sell.
If you are truly interested in attempting to purchase and not yet working with an agent, this is the time to find one. Sit down with your Realtor to review the comparables and sales history. Request that they order an MPAC report to confirm the size of the house and the property. Have an honest discussion about value.
Once you’ve done your homework, your Realtor can approach the owners to see if they might be willing to sell, or if it’s in their future plans. While unconventional, buying a home that’s not on the market is certainly possible.
My girlfriend and I are in our mid-twenties. We’re thinking about getting a place together. Any advice? – YOUNG AND IN LOVE
DEAR YOUNG: They say love is blind, but when it comes to home ownership, it’s best to go in with your eyes wide open.
The fact that you are shopping with your girlfriend is important. Unless you are married and in a permanent relationship, it may be best to approach the purchase like a business. While you’ll want to back this up with legal advice, I suggest entering into home ownership as “tenants in common” rather than as “joint tenants”. The key difference is found in what happens if one of you passes away.
Married couples commonly buy as “joint tenants”. As such, if one of them dies, the property automatically transfers to the surviving owner in a “last man standing” type of scenario.
There is no automatic transfer of property for “tenants in common”. If one of you passes away, that owner’s share will be retained by their estate (which remains with their own family). By entering into your joint purchase as “tenants in common”, you and your girlfriend are essentially business partners. Should you get married down the road, the ownership style can be changed.
It may seem grim to frame your purchase this way, but doing so can unlock the benefits of home ownership and market appreciation, while protecting both of your investments. Whether you purchase with your partner, sibling or best buddy, it’s important to get a foothold in the real estate market as early as you can. Chances are, your investment will appreciate faster than you can save — and whatever the future holds, you’ve got to live somewhere.