Purchasing real estate is often considered one of the most significant investments in a person's life. In Senegal, this process takes on a special dimension when undertaken with others. Whether with family, friends, or business partners, buying property together opens new horizons while also presenting unique challenges. This article explores the various facets of this growing trend, highlighting the solutions, advantages, and precautions to take to transform this collective endeavor into a resounding success.
The rise of collective real estate purchase in Senegal
Buying property together in Senegal is not a new phenomenon, but it has gained popularity in recent years. This trend can be explained by several factors. On the one hand, rising property prices make individual purchase more difficult for many Senegalese. On the other hand, joint ownership offers the opportunity to share the financial burden while benefiting from greater borrowing capacity. Furthermore, this approach allows access to higher-quality or better-located properties that would otherwise be out of reach for a single buyer.
Buying property together is therefore a pragmatic and strategic solution, adapted to the economic and social realities of Senegal. Whether for acquiring a primary residence, a secondary residence, or making a rental investment, a growing number of Senegalese are opting for this approach.
Financing a property purchase with multiple partners
When it comes to buying property with others in Senegal, financing is a central issue. Traditionally, acquiring real estate often involves taking out a loan. In the context of a joint purchase, this process takes on a different dimension. Each co-buyer generally has to apply for a mortgage individually, although ideally, they should approach a single bank to facilitate management and coordination.
The main advantage of this approach is increased borrowing capacity. By combining their financial resources, co-buyers can make a larger down payment and secure a higher loan amount. This financial synergy allows them to consider purchasing higher-value or better-located properties, thus maximizing the investment's potential.
However, it is crucial to understand that joint borrowing also carries risks. If one of the joint borrowers is unable to repay their share of the loan, the other members of the group are legally obligated to assume the monthly repayments in their place. This shared responsibility underscores the importance of transparent communication and careful planning before entering into such an arrangement.
In summary, although crowdfunding offers undeniable advantages in terms of borrowing capacity and access to better quality goods, it requires a thoughtful approach and a clear understanding of everyone's commitments and responsibilities.
Joint ownership: a flexible solution for buying with others
Joint ownership is one of the most common and flexible solutions for purchasing real estate with others in Senegal. This legal structure allows individuals, whether related or not (friends, business partners, or cohabiting partners), to acquire property together. In this arrangement, each joint owner holds a share of the property, which can vary depending on their financial contribution to the purchase.
One of the main advantages of joint ownership lies in its relative simplicity. Unlike other, more complex legal arrangements, joint ownership does not require the creation of a separate legal entity and offers a degree of flexibility in managing the property. Decisions concerning the property, such as its sale or maintenance, are generally made by mutual agreement among the joint owners.
However, joint ownership is not without its drawbacks. Indeed, in the event of disagreement between co-owners, managing the property can become complex. Furthermore, if one of the co-owners wishes to withdraw from the joint ownership, they can sell their share or request the division of the property, which can lead to complications. To mitigate these risks, it is often recommended to draw up a joint ownership agreement, which specifies the rights and obligations of each co-owner, as well as the procedures for managing the property.
The Real Estate Civil Company (SCI): a more formal structure
For those seeking a more formal and organized structure for joint property purchases in Senegal, the Société Civile Immobilière (SCI) presents a robust option. More complex than joint ownership, the SCI involves the creation of a legal entity through which the property is acquired. This structure is particularly well-suited for family purchases or projects involving rental income.
In a French real estate investment company (SCI), the partners hold shares proportional to their initial investment. The management of the SCI is entrusted to a manager, appointed by the partners, who makes decisions concerning the property. This structure offers considerable flexibility in the management and transfer of real estate assets, while allowing for a clear separation between the personal assets of the partners and those of the SCI.
Establishing a French real estate company (SCI) in Senegal requires the involvement of a notary for drafting and filing the articles of association, thus giving the company legal standing. These articles define the operating rules of the SCI, including the procedures for partners to withdraw. Generally, a partner can leave the SCI by selling their shares, subject to the conditions stipulated in the articles of association.
Managing the occupancy of a property purchased jointly
Buying property with multiple people in Senegal inevitably raises the question of occupancy . Depending on the nature of the property – primary residence, secondary residence, or rental investment – the occupancy arrangements can vary considerably.
In the case of a second home or rental investment, co-owners must agree on a clear arrangement. For a second home, this might involve defining a schedule of occupancy for each member, often based on their financial contribution to the purchase. This planning helps avoid conflicts and ensures equitable use of the property.
When it comes to rental property investment, co-owners must agree on property management, income sharing, and responsibilities related to property maintenance. Good property management is essential to maximizing the return on investment and maintaining the property's value.
For a primary residence occupied by all the owners, the situation becomes more complex. It is then necessary to clearly define the private and common areas, as well as the repair and maintenance responsibilities of each person. This arrangement requires exemplary agreement and communication between the co-owners to ensure harmonious cohabitation.