A guide to co-ownership
With high prices, rising inflation and conservative lending from banks, it remains incredibly difficult to get on the housing ladder. One possible way around this is to look at buying a house with another person. Read on for more information on co-ownership.
What do we mean by co-ownership?
At its most basic, co-ownership is when two or more people hold title to a property. For the purposes of this guide we will make the assumption that those people are buying a house or flat together. But there are different types of co-ownership, and it pays to know which one suits you best.
Tenants in Common
In this setup, each owner has the right to occupy the property in its entirety but not sole possession. What does that mean? Well, if one of the co-owners dies then their share of the property is passed onto whoever is named as the recipient in their will, and they will then be tenants in common with the other co-owner/s.
Prospective co-owners looking to buy with friends or perhaps even a girlfriend or boyfriend might find this an appealing form of co-ownership.
Joint Tenancy
A Joint Tenancy requires joint tenancy to enter into it at the same time and with equal shares. Here, in the event that one of the co-owners dies, their share passes to the other owner or owners automatically.
This type of co-ownership is more common among family members and married or long-term partners, though married couples can also co-own property through Tenancy by Entirety.
Tenancy by Entirety
Here, each partner owns a half of the property and cannot sell their share without the consent of the other. If one should die, the other partner inherits their rights to the property. As with Joint Tenancy, the legal arrangement requires the co-owners to enter into the tenancy at the same time and with equal shares.
Tenancy by Entirety can be terminated through an agreement, death or divorce. In the event of the latter, the co-ownership would revert to a Tenancy in Common arrangement.
