Should we own our property as joint tenants or tenants in common?

There are all sorts of decisions to be made during the home-buying process. Few are more important than the question of legal ownership.

If you are taking on a property by yourself, this is straightforward; you will own the home outright. But buying with other people requires careful consideration of the basis on which each of you will be able to lay claim to some or all of its value. You should get legal advice on whether your circumstances would best suit ownership in the form of a joint tenancy, or a tenancy in common.

There are significant differences between the two. A joint tenancy – typically the form opted for by married couples or those in a civil partnership – means that each person is the owner of the property. They are equal in this respect, regardless of their respective roles in the arrangement or whether one party put in more money than the other. Perhaps the most important aspect of this is that the whole of the property passes to one party when the other dies by the right of survivorship. A share cannot be given away to someone else through a Will or under the intestacy rules. 

A tenancy in common presents some very different possibilities. It enables people who are buying a property together (friends or family members who are pooling resources, for example) to share ownership of that property in different proportions if they so wish. One person might own 75%; the other 25%. There are many different ways of structuring the arrangement, often led by each party’s contribution to the purchase price, or their ongoing liabilities in respect of the property.  Unlike in the case of a joint tenancy, a person’s share of the property will not automatically be inherited by the other owner(s). Each tenant in common is fairly free to do what they like with their share of the property, including passing it on to someone outside of the joint ownership cohort by Will or under intestacy rules. It is always sensible to have a declaration confirming the respective shares in the event that the relationship between the owners does not last.

 If you are embarking on a property purchase, don’t underestimate just how vital it is to make the right decisions from the outset. None of us can predict the future but the next best thing is the ability to put in place protections for ourselves and our loved ones. Ensuring that valuable assets, including your home, are owned in the way that suits your situation now and in way that will work for you in the longer term is one of the most positive steps that you’ll take. We are here to help.  

If we can help you with this area or any other Property Law matter please call us on 01264 353411 or email info@bsandi.co.uk.