Joint property ownership
If you buy, inherit or become a trustee of a property with someone else you must decide which type of joint ownership you want and tell HM Land Registry about this when you register the property.
You can own a property as either ‘joint tenants’ or ‘tenants in common’.
The type of ownership affects what you can do with the property if your relationship with a joint owner breaks down, or if one owner dies. Therefore, whether to hold the property as joint tenants or tenants in common is a crucial decision on which you should seek legal advice.
Joint tenants
As joint tenants (sometimes called ‘beneficial joint tenants’):
- you have equal rights to the whole property,
- the property automatically goes to the other owner if you die,
- you cannot pass on your ownership of the property in your will to someone else,
- if you are not married and you separate, you will each be entitled to a half share in the property regardless of how much you paid into the property.
Tenants in common
As tenants in common:
- you can own different shares of the property,
- the property does not automatically go to the other owner if you die,
- you can pass on your share of the property in your will to someone other than the other owner,
- if you are not married and you separate, you will each be entitled to the share of the property as set out in the transfer deed or declaration of trust.
Sole property ownership
If you are not on the title deeds to the property and there is no declaration of trust setting out your interest in the property, then you may still be able to prove you have an interest if either or both of the following circumstances apply:
- There was a common intention shared by both as to your joint ownership of the property; you relied on that common intention to your detriment; and it would now be unconscionable for you to be denied an interest in the property; and/or
- You were promised, induced, encouraged, or led to believe that you would have an interest in the property; in reliance on that promise, you acted to your detriment, and it would now be unconscionable for you to be denied an interest in the property.
Disagreements over the above often leads to long and costly court proceedings and can be avoided by having a deed of trust setting out what share of the property each of you is entitled to. This can be entered into at any point, it does not have to occur on purchase. For example if one person contributes to extension costs, they should seek legal advice at that point to secure their potential interest in the property.
Changing your type of ownership.
You can change from being either:
- joint tenants to tenants in common, for example if you get a divorce or separate and want to leave your share of the property to someone else, or
- tenants in common to joint tenants, for example if the party who had a smaller share invests more money to bring their share up to an equal contribution.
You can also change from sole ownership to tenants in common or joint tenants, for example, if you want to add your partner as joint owner. This is called transferring ownership.
You should always seek legal advice to discuss options as to how to secure your interest, whether you are the sole owner, or the person contributing. Please get in touch with our Family Team if you have any questions.
