Mortgages  

Most couples don't plan for sharing property on break-up

Most couples don't plan for sharing property on break-up

The majority of people in Britain who buy a property with their partner risk exposing themselves to losing tens of thousands of pounds by not protecting their share of the purchase.

Research by Zoopla has shown 68 per cent of people have no plan in place for splitting their property in the event that their relationship breaks down. 

Over a quarter (27 per cent) of homeowners claim that the proceeds of the property they owned with their partner were not divided fairly when they split up. 

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Of these, 72 per cent said that their partner received more than their fair share, while 28 per cent admitted that they got more than they felt they deserved. 

The research was based on a survey of 1,000 UK adults who had previously purchased a home with a partner, and a further 500 people who had purchased a home with a partner and subsequently split up. 

Zoopla’s consumer expert, Daniel Copley, said people need to be aware that in reality break ups happen and so when buying a home with a partner it is important that each individual protects their investment. 

“Otherwise, they potentially risk major financial losses in the future,” Copley said.

“People may assume they’ll come to an amicable agreement, but anyone who’s experienced a messy break-up will know that fairness and reason often go out of the window,” he added.

Copley warned that individuals putting money into the deposit are particularly at risk, because if their partner is contributing to mortgage payments, they could be entitled to half the home. 

As the average deposit for a first time buyer in the UK sits at £59,000 according to UK Finance, this can amount to serious money Zoopla has warned. 

The research showed that a significant amount of people face this exposure, as a quarter of those surveyed said they paid the entire deposit, while a further 43 per cent said they did not split it evenly. 

In the event of a relationship breakdown, many people will rely on their property investment to finance their future living arrangements. 

However women were more exposed on this front, with 47 per cent of those surveyed saying they had no personal savings whatsoever when they split up with their partner. 

This was in comparison to 37 per cent of men. 

Despite this, only 15 per cent of respondents said they took out a deed of trust or cohabitation agreement to protect their share of the property, and only 10 per cent had a floating deed or commensurate share deed. 

Likewise, only 7 per cent had a property break-up plan clarified as part of a prenuptial agreement. 

Difficult Conversations

Copley said it's vital that couples have these awkward conversations before buying a home together. 

“Key conversations to have with your partner when buying a home are how you plan to split the deposit and mortgage and if you’ll split maintenance costs in line with this,” Copley said. 

He added that it is also important that individuals find out if their partner has any debts, as the research showed that 45 per cent of respondents had no idea whether their partner was in any kind of debt.