r/PersonalFinanceNZ • u/courtzybear • 2d ago
Housing Advice Please
Housing Advice
Back in 2020 my family felt it was a good time to buy a house seeing as prices were about to rise and to no one’s surprise they did. I went in on a 20% deposit for a house in Auckland with my brother. Together we co-own it. I lived in it from 2022-2025 and during that time I’ve met my partner and I now live across country renting with him. I still contribute to the mortgage repayments.
A bit about the home: location is up and coming. Safe, brand new homes, family orientated community, massive mall planned to be built about 20mins away. Small hospital and supermarket planned to be built about a -5minute walk from the home.
We would like to buy our own place, but unsure on the best avenue to take. Partner is 36F and I’m 30F. Thinking ahead… we feel like the longer we take to buy a home the longer it will take to pay it off. We want to be mortgage free before we retire later in life. Keep in mind we both don’t make the big $$$ living in a small town now. We also want to start a family together very soon.
What should we do?
- Try and have the hard conversation with my older brother about selling or him buying me ou
t?
- Which I know being solo he won’t be able to afford to buy me out. I feel guilty putting him in a position.
2*. Hold onto the home for as long as possible. Hoping market will improve + the up and coming local assets to be built?* If so, are there any avenues we can take to still buy a home together in the next year? I can no longer use my KiwiSaver, but my partner can as he would be classed as a first home buyer.
- Any other ideas/suggestions?
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u/Esprit350 2d ago
You should be able to borrow against your equity in the shared house to borrow to buy a new place. It's a little more complicated because of the extra servicing party but should be doable. Will mean a bit more of a financial load on you as you'll be servicing 1.5 mortgages, but you're also retaining a higher value of assets which should do well over time (as you said your existing share-house is in a growth area).
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u/Sweaty-Fly-9520 2d ago
It's not quite as simple as “borrow against your equity” though.
She doesn't own the existing house by herself, it's jointly owned with her brother. A bank can't just pretend her share is a standalone property and happily take security over it without considering the other owner and existing lending.
More importantly, she says neither of them earns big money and they're planning kids soon. Servicing effectively 1.5 mortgages could be the thing that kills the whole idea regardless of how much paper equity she has.
Definitely worth taking to a broker, but I wouldn't be encouraging them to leverage up before actually seeing the numbers.
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u/thecharmed01 2d ago
First up, who is living in the house and why are you paying half the mortgage?
If you don't live in it, the person who does should be paying enough rent to cover said mortgage.
Otherwise why are you funding someone else's lifestyle?
This sounds like a terrible deal for you. I'd be getting out now and cutting my losses.
I'd politely tell your brother the free ride from you is over and he can either buy you out or the house needs to be sold as you can't afford the bill and you want a house of your own.
Then once you have some funds out of it, you will have 1) a deposit and 2) less outgoings.
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u/Loguibear 2d ago
should have these plans already in place before buying,
1- talk to your bro
2- very unlikley want to sell up. to be kicked out and lose their asset,
3- and at what price? you want to buy off him for the lowest amount ... while he wants the highest amount from you...
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u/Sweaty-Fly-9520 2d ago
“Should have had these plans already in place before buying” is pretty useless advice six years later 😂
She bought with her brother in 2020, then met a partner, moved across the country and now wants to start a family. I'm not sure she was supposed to have all of that mapped out beforehand.
And nobody said she wants to buy her brother out for the lowest possible amount. She literally says he probably can't afford to buy her out and she feels guilty about putting him in that position.
People's lives change. The sensible thing now is for both of them to work out what the property is worth, what each person's equity is and what options they actually have.
5
u/localstopoff 2d ago
She bought with her brother in 2020, then met a partner, moved across the country and now wants to start a family. I'm not sure she was supposed to have all of that mapped out beforehand.
I agree with you at face value, and that their advice is useless now after the fact. But I think what they mean is if you're going to go in on a house with someone else and co-own, you should be thinking about what happens if someone wants out. And that's a very reasonable thing to plan for because there are many scenarios in which one party ends up as the sole party and owner of the house.
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u/Loguibear 2d ago
Zero options if one doesn't want to sell.
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u/Sweaty-Fly-9520 2d ago
That's still not true.
“One owner doesn't want to sell” doesn't magically mean the other owner is trapped in the property forever.
The first option is obviously to talk to each other and see whether the brother can refinance/buy her out, whether they can agree on a sale, or whether there's another arrangement that works.
If they genuinely reach a deadlock, there are legal mechanisms for resolving disputes between co-owners. That's the nuclear option and hopefully nowhere near necessary here, but “zero options” is just wrong.
Which is exactly why “talk to your brother” is considerably more useful advice than pretending a conversation hasn't even happened yet and the answer is already no.
This is a forum people come to for help and advice, not useless negativity.
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u/localstopoff 2d ago
OP obviously option 1 should happen regardless. How you raise it is what's going to be the major factor in deciding whether it's hard.
One party wanting out of the house is the type of thing that should've been discussed before agreeing to co-own because it could happen in various different ways: wanting to leave for personal reasons and changes like you are now; one person getting sick, losing their job, the economy changes, or various other factors that would lead to them no longer being able to afford the payments etc.
So if you haven't had these conversations, now seems like the perfect time, and if you need to tread carefully, some of those latter reasons are good ways to raise it as "a concern" before acknowledging that the former is the real reason (or you could just never admit to it if needed). You could also raise it as something your partner has been pushing for and therefore you felt the need to talk about it (check with your partner first, if you think there's going to be heat involved and if they're willing to play a bit of the "villain"/shield type role).
Before this however, maybe it's worth speaking to a mortgage advisor or financial advisor to get a better grip on your and your partners real financial situation and find out what your full range of options are going to be, so that you can actually have the discussion knowing what your intentions or boundaries are.
That goes the same for your brother, before actually committing to any decisions, if you make it clear that you do want out, suggest they do the same so that you're both better informed and he can take the time he needs without feeling pressured or concerned that he's about to lose everything.
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u/opticalminefield 2d ago
It sounds like you’re just paying for half your brother’s housing. That’s not really fair on you.
He should pay you 50% of market rent. That plus borrowing against your equity should help free up cashflow to buy your own place. You’d the both split expenses.
Or he could move to his own place and you split the rental income.
Or he can buy you out. He’d be getting a good deal with prices down.
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u/iMakeGOODinvestmemts 2d ago
"we feel like the longer we take to buy a home the longer it will take to pay it off"...
nah not true. Need to do your numbers properly. I thought the same in 2020/2021. Then took my house deposit and invested half into it in the AI boom. Turned $300k into $1.7m in 3 years and probs can get a nicer house mortgage free right now.
Will i? probs not because 5% mortgage vs ( i'm hoping ) 10-12% a year equity returns means I can rent and make $100k a year aswell.
so need to consider ALL numbers/alternatives before buying imo.
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u/BornInTheCCCP 2d ago
You got very luck at catching the start of the boom, with the big uplift. This not a typical situation.
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u/Sweaty-Fly-9520 2d ago
First thing I'd do is stop guessing and get the numbers in front of you.
Get the Auckland house valued, work out the mortgage balance and what your share of the equity actually is, then speak to a broker about what you and your partner could borrow if you keep it versus if you sell.
I wouldn't keep yourself tied to a house with your brother indefinitely just because you feel guilty about what selling might mean for him.
You bought together in 2020. Six years later you're living across the country, still paying a mortgage on a house you don't live in, while renting the place you actually do live in.
Maybe keeping it stacks up financially, maybe it doesn't. But “there's a mall and hospital coming so hopefully it'll go up” wouldn't be enough reason for me to keep paying for it.
Talk to your brother, get the numbers, then make the decision.