What is the difference between Joint Tenants and Tenants in Common? - Your Questions Answered Series

Joint Ownership of Real Property – Basic Concepts

When purchasing a property with one of more other people, you are required to decide whether you will own the property as ‘joint tenants’ or ‘tenants in common’.

 Joint Tenants

When parties choose to own a property as joint tenants, the whole property is owned equally by all parties. The most important aspect of owning property in this way is that if one of the owners passes away, the whole property remains owned equally by the remaining parties (meaning the interest that the deceased had in the property automatically passes to the surviving joint tenant/s). This occurs regardless of the deceased’s wishes set out in their will. This kind of arrangement is common for a couple that intend to live together in the property (e.g. spouses) and want their share of the property to go to their partner upon their death.

 Tenants in Common

When parties choose to own a property as tenants in common, they own the property in defined shares that can be equal or unequal (e.g. for two tenants in common some possibilities are 50/50, 99/1, 30/70 etc., for three tenants in common, some possibilities are 30/30/40, 98/1/1, 20/30/50 etc. and so on). An owner can sell their defined share in the property and, if they pass away, their defined share will form part of their estate and be gifted in accordance with their wishes in their will (or by the rules of intestacy if there is no will). This kind of ownership is beneficial where parties wish to protect their ownership interests from other co-owners or where the parties provide different financial contributions to the property etc. There may also be tax advantages in owning the property in different shares and as a result, this form of ownership can be beneficial to investors.

See our further article HERE for more complexities about holding property as Joint Tenants and Tenants in Common.

For more details or for advice in relation to your ownership of property or if you are in dispute with a co-owner, please do not hesitate to contact us to discuss your options.

Important Disclaimer: The material contained in this publication is of a general nature only and is based on the law as at the date of publication. It is not, nor is it intended to be, legal advice. If you wish to take any action based on the content of this publication, we recommend that you seek professional advice.