People often buy property together. When purchasing property with another person, such as a spouse, family member or business partner, you have the option to make the purchase as either joint tenants or tenants in common.
Where two (or more) people purchase a property as tenants in common, each of them will co-own the property with separate and divisible shares in that property. You can also choose the amount of each share. For example, it may be that party A owns 50% and party B owns 50%, or that party A owns 1% and party B owns 99%.
Furthermore, by having you own individual shares you can dispose of that share as you wish. This is a good option for business partners, as it also means that their respective estates will benefit on the death of the partner.
If two (or more) people purchase a property as joint tenants, they will hold the property together so that in circumstances where one of the owners dies, his or her interest will pass to the survivor of them automatically. Spouses often buy as joint tenants.
In the context of property owned as joint tenants, issues can arise where the relationship between the joint owners has broken down. In these circumstances if may be necessary to severe the tenancy.
You can sever a joint tenancy in one of three ways:
- By unilateral serverance. That is, you can choose to severe the joint tenancy on your own.
- By mutual agreement between you and the other party; and
- By a dealing which shows that the interests of the owners were treated as creating a tenancy in common.
If you would like more information on the issues raised in this article, please call the Central Coast’s Leading Conveyancing Team at Brazel Moore Lawyers on 4324 7699.