They may be there for you

With property prices escalating beyond the reach of many young people, sharing the cost of buying a house is an option which more and more are considering. Traditionally, young couples have saved for their first home themselves. But increasingly, people are trying to buy their first home while they're still single.

However, this is becoming more and more difficult as fewer and fewer single people have either the capital saved or income required to get on the property ladder at the moment.

For many years, groups of friends in London and other large UK cities have been buying property together as a first step, a move that is now becoming more popular on this side of the water.

But like many young couples in the past, some do find this route is full of pitfalls. Friends can fall out or one can emigrate or one may have to move cities to follow their employment. For this reason, Richard Eberle, managing director of Rea Mortgage Services, says it is important that anyone thinking of going down this route has a legal agreement drawn up. Solicitor Margaret Finlay, of Finlay & Co Solicitors, says the important thing is to decide what will happen if any of the above circumstances happen.

Agreements of this sort are also very relevant for gay couples. Ms Finlay warns that the best legal agreement is not going to prevent the emotions from going into play if a couple should split.

A basic agreement where the people have already decided what should happen in different circumstances will cost about £150. But if you need the solicitor to offer advice and come up with an individual agreement, £250 is probably the least you will pay.

The biggest problem is that unlike the situation for married couples, there is no official contract and the courts generally do not interfere. As Ms Finlay warns, these agreements are "fraught with difficulty".

One man, Paul, bought a home with a friend in London without an agreement and the other guy lost his job. Paul now wants to sell but his friend does not want to. Paul does not want to institute legal proceeding and over two years later is still paying half the mortgage.

Another couple, who planned on getting married, also bought a property. His grandmother had died and left him a small lump sum which he used to pay the deposit and legal fees. After about two years, they split up and she moved to England. He now does not know where to find her and thus cannot sell the house.

The other major problem area is tax. If one of a married couple dies, their part of the home simply passes on to the spouse. But if you are, as the Revenue puts, it "strangers in blood" all proceeds above £12,500 will be liable to capital acquisitions tax. According to Ms Finlay, the bottom line is you have to be prepared to ask for advice and to pay for it. After all, it must be worth paying £250 in order to secure your biggest asset. And you are simply fooling yourself if you think you do not need proper advice.

Nevertheless, as Mr Eberle points out, it does present an opportunity for two friends who otherwise would not be able to buy a home. But the idea still has not caught on to a great extent. Many people still want to be the sole buyers when it come to acquiring a home, according to Mr Eberle. But if house prices keep increasing, that may change.