Buying a home together – how joint ownership works

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Buying a house is an exciting time. Amongst the thrill of finding the right house, putting in an offer and getting it accepted, the formalities and legalities of buying a house can easily be overlooked.

If you are buying a house with someone else – be it your spouse, a partner (whereby you are not married) or a friend – you will need to decide the manner in which you will own the property.

When purchasing a house with someone else, you will usually have two options in terms of ownership: Joint Tenancy or Tenants in Common. Here is some information on the two options, including some things you may wish to consider.

 

Joint Tenancy

Joint Tenancy is the most common form of joint home ownership. Although it is simple and straightforward, the simplicity of such an agreement can, in turn, result in potential pitfalls.

Joint Tenancy effectively means that the two people named as joint tenants on the Land Registry each own 100 per cent of the property together. As such, each has an equal claim on the property, even if one of the parties has never paid a penny towards it. In the event that one of the joint tenants dies, the whole of the property immediately passes to the surviving tenant – it cannot be bequeathed to anyone else in the deceased’s will.

It is worth noting that it is technically possible for one of the joint tenants to sell the property, even if the other does not agree.

 

Tenants in Common

The other option is to purchase a home as Tenants in Common. In this arrangement, up to four joint owners can be tenants in common and each has their share of the property outlined at the outset. The beauty of this form of ownership is its flexibility, as the shares each party owns can be different, therefore reflecting scenarios where one party contributes a bigger deposit than others or someone moves into a home already owned by their partner.

Should one of the tenants in common want to sell their share of the property, they would need to simply sell their share to a replacement tenant or the other tenant named on the deeds.

Joint ownership of a property can take a range of different forms, each with its own advantages – and potential pitfalls. So it is important you understand your position at the outset to avoid any heartache down the line. Neither of the options outlined above is necessarily any better than the other and the choice you make will depend very much on personal circumstances.

For more information or to seek legal advice from one of our residential property lawyers, please contact us here.

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