Dear Quentin,
I’m fortunate enough to have married into a large family. Most of my wife’s siblings are married, and we have one adorable nephew. We really enjoy spending weekends and holidays together as a family. However, as my siblings-in-law settle down, it’s looking increasingly likely that none of us is going to live closer than an hour or so away from my in-laws.
There’s not enough room in my in-laws’ house for more than three of their children, plus spouses, to stay over. We can do a bit better than that if some of us stay with neighbors, but there’s a limit to how often we can ask — especially on holidays when they likely want to host people themselves. And it doesn’t feel as homey and comfortable as staying with family.
My wife and I can’t afford a second home in my in-laws’ neighborhood, and that is unlikely to change in the next few years. We can only afford a fraction of a second home. I’ve been mulling over the idea of starting a family discussion about trying to pool our money and buy a house together, which we will be able to use when we visit.
“‘If my in-laws provide most of the down payment, the kids could split the mortgage payments, property taxes and upkeep.’”
If my in-laws provide most of the down payment, the kids could split the mortgage payments, property taxes and upkeep (possibly unequally, with the ownership of the house split accordingly), and I think we can manage it. We can consider renting the house on Airbnb ABNB, +0.92% when none of us is there to help with the costs, although I wouldn’t rely on that income.
My wife is on board, but I’m afraid that the financial discussion will cause tension in the family. I’m also afraid that some of my siblings-in-law would be afraid to say no, and would feel pressured to contribute more than is financially responsible in their current position. My wife didn’t really grow up with open family conversations about finances.
We really want to make this work, and I think the rest of the family will too once they consider the idea. Could we please have some advice for how to start a productive and open discussion?
Son-in-Law
Dear Son-in-Law,
The question to ask first is not how to approach your siblings, but whether you should buy a home with them. Given what you say about your extended family’s differing familial and, likely, financial situations, it’s hard to justify. Buying a home with a family member is akin to going into business with a family member. You sign contracts; you have to manage the property and pay the taxes and upkeep.
There is also the hypothetical future scenario where two or more families wish to stay there during Labor Day weekend, or Thanksgiving, and there’s a showdown over who stayed there last time. Your in-laws’ house is not going to be big enough to accommodate the entire family, and there’s every reason to think that a house purchased by you and your wife’s siblings will have similar space constraints.
As for buying a property with a friend or family member, or family members, it’s a complicated financial proposition for your siblings-in-law, your wife’s parents — who would have to agree to stump up the down payment — and the mortgage provider. There are a lot of assumptions here: People’s fortunes often rise and fall over time, and you would need enough of a cash cushion to withstand that.
If you buy the property as “joint tenants,” you each own 50% and, should one of you die, you cannot leave your half to a third party. If you are “tenants in common,” you can decide on your respective shares, and leave your own share to a third party. How will you divide your shares of the house if one party contributes less than the others? Will one person be given the option to buy the person out?
Wait until you are all together to broach the subject: “How would anyone feel about buying a home together?” That way, you will easily get the temperature of the room. I believe face-to-face conversations are far more effective than email or WhatsApp META, +2.43% group messages. But know that it would be a big ask of your wife’s siblings — assuming they have children who will need college funds — and your in-laws.
Proceed with caution. It’s always good to explore ways of building wealth, but if there is no appetite for a collective purchase, don’t push it. People are allowed to say no without being cajoled or given a sales pitch, or told that your way is the right way.
Your wife’s family members seem to get along, and they are not used to having conversations about money management. Those two things may be related.
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