Friend gets the mortgage, but we both pay it back and own the house?

No

Apart from having to be very careful about mortgages with friends, if he can get a mortgage on his own you can both get a joint mortgage. Full of drawbacks though

You get a mortgage from him who gets a mortgage from the bank - and you pay him and he uses that to repay the bank each month.

It's not really legal and he will own the house up until the mortgage is cleared and only then can he transfer ownership to you, and that would have its own cost also. If the mortgage is in his name he cannot give you the house.

Also what if you repaid him for years and then you have a falling out and he keeps the house you mostly paid for! You would have no recourse

You are the chap that moved into a rental then decided that the rent should be cheaper then you are suing your landlord. No way in hell would I trust you to buy a house with, to take a mortgage on pretense you will pay me half.

You are very loose, you are happy today then tomorrow you feel hard done by because someone is earning better than you.

You need a reality check and if your friend had any smarts won't do sort of deal with you.

Society & the legal system put a degree of sectioning off in place that prevents this from happening.

Lots of cheat systems around getting a mortgage and paying it off using income you have paid income tax on are blocked off in one way or another. You can imagine a situation where an employer builds a load of houses and after 15 years working there for a poor wage you get to own the house. It would seem like such an efficient way of doing things, however the tax man and the bank man both lose out big time in this situation hence it is very hard/impossible to do legally.

Families also love falling out over houses. It's almost like they get a kick out of it. You might get on great with them but as soon as it's about houses they'll get their sharpest sword from the armoury and they'll be ready to fight you with it!

This, legally speaking, is the best way to share ownership of a house. In this age of equality, sham marriages are open to all!

I think it's quite a normal intrepation of your thread about a rental property bought in 2011, and asking about yield, CGT etc.

Maybe its not your property, however you never said it was not in reply to posts such as:

"You have a very well performing investment and bought right at the bottom...."

I was going to post on your thread about the rental issue that you should simply your life. However, you seem determined to complicate it further with this joint ownership but single mortgage application.

You do need to think about this carefully, though. Married couples and cohabiting conjugal couples who buy houses together are generally in it for the long haul. Even if they contemplate that they might sell this house in 3, 4, 5 years, that will likely be in the context of buying another house together.

Whereas two friends may not be thinking this way, since there's an excellent chance that in the 3-5 year timeframe one or other of them will acquire a spouse or conjugal partner and so (a) won't wish to continue living in the shared house or (b) will wish to sell the shared house and embark on a shared purchase with their spouse/partner, or (c) both. So the likely timeframe for this investment is short to medium term, not long-term.

This matters because, they way repayment mortgages work, virtually nothing is paid off the mortgage for the first 10 or more years. Virtually all of the monthly repayment goes on interest costs; almost nothing is paid off the capital. The capital outstanding reduces very, very slowly, and it takes many years before it reduces enough that the monthly interest on the outstanding loan starts to go down to any material degree. At that point more and more of the monthly repayment goes to reducing the capital and it gets repaid faster and faster.

What this means is, in the early years, your mortgage payments are not building up any equity in the home. If you sell in the space of 3-5 years, despite you having made large monthly payments to the bank all that time, virtually the whole amount you borrowed is still outstanding. After you deduct the transactional costs of buying and selling - estate agents, lawyers, stamp duty; it adds up to quite a bit — you may well be in the red — unless the value of the house has risen in that time. Any equity you build up during this period comes entirely or almost entirely from house price inflation.

Which is fine, if house prices have inflated. Which they don't always do. And, right now, when they are at historic highs relative to earnings, and when there is considerable political pressure to address housing costs, this might not be the best time to take a punt on continuing house price inflation.

And that's the real danger here. You could enter into this arrangement with a friend, but its an arrangement that it can be awkward, inconvenient or expensive to get out of, and there's a high chance that in a realistic timeframe it won't yield any return.

Of course, a married or conjugal couple face exactly the same risk, but they may have a different attitude to it, for two good reasons. First, their timeframe isn't 3-5 years; it's much longer. And, secondly, by marrying/coupling up they are committing to a shared financial future, and shared investment risk, anyway. They're putting their investment eggs in the basket in which they have already decided to put all their eggs anyway, so to speak.

None of this is to say that two friends — or two siblings, say — shouldn't buy a house together. But they do need to appreciate that they are not a married/congugal couple, and the buy-a-house-on-mortgage model which was tailored for married couples isn't quite so well tailored to the investment objects, timeframes and attitudes to risk that they are likely to have. So they need to look at this very carefully, think dispassionately, and make decisions about whether they are comfortable with the downside risks.

The mechanics of doing something are one thing, the advisability of doing it is another.