Joint Tenancy -vs- Tenancy in Common – What is the Difference?

The tenancy in this context does not refer to the usual meaning where one pays a landlord to occupy the property for a period of time but rather refers to the ownership of a property. Ownership of property can either be solely owned or co-owned. And Co-ownership is either one of the two types, either JOINT TENANCY or TENANCY IN COMMON.


What is a Joint Tenancy?
This refers to individuals jointly owning the whole property in equal shares rather than owning a specific
share of the property. Moreover, this is an appropriate form of co-owning a property for a husband and
wife or couples in stable relationships, since on the death of one partner, the ownership of the property
still remains with the surviving partner.

Some of the advantages are:
– Equal share in any income from the property
– Saves cost of paying a solicitor for a deed of trust
– For spouses, upon separation you each get half


On the contrary, the shortfalls of Joint Tenancy are:
– A co-owner can sell without the permission of the other co-owner
– If you invested more in the property, your share is still jointly owned
– You cannot leave your share of the property ownership to anyone else


What is Tenancy in Common?
Tenancy in common allows each owner to own identifiable shares in the property – to put simply, the amounts contributed for the whole purchase price are unequal. For instance, four friends might buy a
property and, because of unequal contributions to the purchase price, divide the ownership in proportionate shares (A:35% B:25% C:25% D:15%). However, business partners or friends are more likely to purchase property as tenants in common.

Some of the advantages of Tenancy in Common are:
– Contributions to the total purchase of the property can be unequally shared.
– Upon death, your share of the property goes to your estate
– This may be more tax efficient
– Your share in the purchase can be left to whoever you choose after your death.

Some of the drawback to Tenancy in Common are:
– Inability to pay the shared bills might cause an issue between co-owners
– A co-owner can sell their share to whomever they please without consulting the other co-owners
– There may be difficulty in reaching an agreement with diverse opinion in the case of multiple co-owners.
– You might need to pay a solicitor to help you draft a deed of trust.


An important difference in practice exists in the case of Joint Tenancy but not in Tenancy in common, which is known as the “Right of Survivorship“, which refers to shares in the property automatically passing to the surviving joint tenant upon the death of the other. As there is no right of survivorship in the case of a tenancy in
common, share does not automatically pass to the others if one person dies but goes to the estate of the
deceased.


However, it is significant to note that certain risks can be avoided and addressed at the time of initial purchase of property for tenants in common, in other words, both the legal rights and financial interests of all co-owners can be protected from the outset with a legally binding property ownership document (A Deed of Trust).

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