When buying property in England and Wales, co-owners can choose to hold their property either as joint tenants or tenants in common. Both arrangements involve shared ownership, but the legal implications, especially regarding inheritance and sale, are quite different. Here’s an overview of what each type means, how they work in practice, and how you can identify the ownership type from the property title register.
1. Joint Tenants
In a joint tenancy, all co-owners collectively own the whole property. No individual co-owner has a distinct, separate share in the property. This form of ownership is often used by married couples or civil partners because of a key feature called the right of survivorship.
- Right of Survivorship: If one joint tenant dies, their share automatically passes to the surviving co-owner(s) without the need for probate or a will. The deceased person’s interest in the property simply dissolves, and the surviving owners take on full ownership.
- Selling or Changing Ownership: Since each joint tenant holds an undivided share, one party cannot sell or transfer their interest in the property without the consent of the other(s).
2. Tenants in Common
Under a tenancy in common, co-owners hold distinct shares in the property. These shares do not have to be equal; one co-owner could hold 75%, while another holds 25%, for example. This arrangement is more common among friends, business partners, or couples who wish to maintain separate ownership interests.
- No Right of Survivorship: Unlike joint tenants, tenants in common do not benefit from the right of survivorship. If one co-owner dies, their share does not automatically pass to the other co-owner(s). Instead, it becomes part of the deceased’s estate and will be distributed according to their will or the rules of intestacy.
- Selling or Changing Ownership: As a tenant in common, each co-owner can sell or transfer their share independently, without needing the consent of the other owners.
3. How to Tell from the Property Title Register
For property registered with the Land Registry in England and Wales, the title register provides crucial information on how the property is held.
- Joint Tenants: If the property is owned as joint tenants, this will not be explicitly stated on the title register. The absence of any specific mention of ownership type, particularly in relation to restrictions, generally indicates joint tenancy. The presumption is that co-owners hold the property jointly unless stated otherwise.
- Tenants in Common: If the property is held as tenants in common, this will typically be reflected in the title register by a Form A restriction. This restriction will state something like:
“No disposition by a sole proprietor of the registered estate (except a trust corporation) under which capital money arises is to be registered unless authorised by an order of the court.”
This indicates that the co-owners hold distinct shares in the property, and if one owner wants to sell, mortgage, or transfer their share, certain legal requirements need to be met, often requiring the other owners’ agreement or involvement.
4. Changing Ownership Type
It’s possible to change the type of ownership after acquiring a property.
- To change from joint tenants to tenants in common, the co-owners can “sever” the joint tenancy by issuing a notice of severance and registering a Form A restriction with the Land Registry.
- To change from tenants in common to joint tenants, the co-owners will need to mutually agree to transfer the property back into joint ownership.
Summary
- Joint Tenants: Co-owners own the property equally as a whole. On death, ownership automatically passes to the surviving co-owner(s) through the right of survivorship.
- Tenants in Common: Co-owners have distinct, possibly unequal, shares. Upon death, each co-owner’s share forms part of their estate and does not automatically pass to the other co-owners.
- Title Register: Look for a Form A restriction to determine if the property is held as tenants in common. If no restriction appears, it is likely held as joint tenants.
Understanding these distinctions is essential for managing future property decisions, especially in matters of inheritance or sale.