Cohabitation and self protection.

We are being told that despite average mortgage payments having fallen to 2003 levels, it is now more difficult for first time buyers to get a foot on the housing ladder according to a new survey by RBS.

The Ability to Buy Index makes pretty dire reading for first time buyers. With mortgages difficult to come by, save for those with significant deposits, the current increased costs of living and current uncertain economic climate most first time buyers will probably be sitting tight.

However many estate agents will tell you that it is a great time to buy with significant numbers of properties on books but too few buyers driving the prices down in certain areas.

But for those many individuals who decide as a couple to take the plunge, there is the legal minefield of how to own the property and in what shares. Most couples may be able to have a joint deposit which they have saved together, or agree to put the same amount into a property as the deposit. But in my experience this is rare. Most couples have different resources, either through family wealth or different lifestyles. Typically a female partner will have more money to invest than her male partner.

The couples incomes may also be different. So how do we advise a couple to own a property? We ask them to consider the unthinkable, their relationship breaking down. Their faces drop and even more so if we have to ask one party to leave the room so that the other may have independent advice if they stand to lose upon the proposed arrangement.

The best advice is that they consider a written agreement as to their shares in property ownership yet it is estimated that only 15% of couples have an agreement. Many agreements are compulsory across European jurisdictions and will clearly avoid costly litigation in the future.

We point out the findings by the Supreme Court in Jones v Kernott where eventually Mrs Jones walked away with a 90% share of the jointly owned property but highlighted the urgent need for this area of the law to be reformed as it took four different hearings in four different courts and significant expense to still leave many without agreements at the mercy of the Judiciary.

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