If you have recently purchased a property or are in the midst of buying your first property with another person, you may have come across the terms “joint tenancy” and “tenants in common”. If you have no idea what we’re talking about, let us break it down for you. Whether you are purchasing a property as a married couple, siblings, or friends, it is important to ensure that the manner in which you own the property is the right one. What are the different types of ownership? In Queensland, when people purchase property together, there are two types of ownership:
Joint tenancy is where all owners have equal ownership and interest in the property and a right of survivorship exists.
The right of survivorship means that when one joint tenant passes away, the interest of the deceased joint tenant is automatically passed to the surviving joint tenant and does not form part of the estate of the deceased.
Tenancy in common
When people own property as tenants in common, it means each person has a recognisable interest in the property, which may not be equal.
For example, one person may own 99% of the interest in the property with the other owning 1%.
Also, the right of survivorship does not exist between the owners. If one of the owners passes away, their interest in the property does not transfer automatically to the remaining owners, but forms part of the deceased person’s estate.
This can be very important particularly if you intend to buy property with friends or siblings.
There are various benefits to each type of ownership, and we recommend speaking with one of our team members before purchasing a property to determine what works best for your situation.
Come in and see us at Chris Sheath & Associates Solicitors on 193 Hume Street, Toowoomba, or call us on 07 4638 5541 to book an appointment.