Property Ownership: Joint tenancy vs tenancy in common
The decision to purchase property is one of the biggest you will ever make – and more often than not, you will go into this commitment with another person. This may be a partner, spouse, family member or friends.
When property has more than one owner, it’s really important to make sure you get the right kind of ownership agreement. This can prevent problems arising later in the event of a co-owner wanting to sell their share, or on a co-owners death.
There are two common kinds of property ownership: Joint Tenancy, and Tenancy in Common. Whilst both of these ensure each party has ownership rights and a share of the property, there are different rules regarding what happens in the event of the death of a co-owner.
Under joint tenancy, each co-owner holds an individual interest – for example, in the case of a married couple. In this case when one of the owners dies, their interest in the property automatically passes to the surviving co-owner, and does not form part of any deceased estate.
Tenancy in Common
Tenancy in common often applies to friends or family members who are co-owners of a property. Their interest in the property does not have to be equal, and the agreement can be tailored to suit individual needs. If one of the co-owners dies, their interest forms part of their deceased estate, and does not automatically pass to another co-owner.
If you need any advice about joint tenancy, or wish to change your tenancy at any stage, call Kate at Clarity Conveyancing for more information.