Owning a Property Jointly, How to Buy Together

A jointly owned property involves various areas of property law which should be considered and we expand on in our latest article de-mystifying property conveyancing.

The word “estate” in relation to a piece of land is used to describe the bundle of rights, covenants, charges and other interests associated with it.

Each piece of land has two estates, the legal estate and the equitable (or beneficial) estate.

Legal and Equitable Owners

The owners of the legal estate are the registered proprietors (if the title is registered) or those in whose name the most recent conveyance was made (if it is unregistered). They have the power to transfer legal ownership of the land or to mortgage it etc. The owners of the equitable estate are the ones who are actually entitled to the equity in the property. Typically, the legal owners and the equitable owners will be one and the same, though this does not have to be the case.

Trusts Arising on Joint Legal Ownership

Where two or more people own the legal estate jointly, a trust of land automatically arises (s36(2) Law of Property Act 1925) and is known as an implied trust. The legal owners are the trustees and they hold the land on trust for the equitable owners (the beneficiaries). Usually the legal owners and equitable owners will be the same people. For an example a couple who buy a home together will, unless they express otherwise, hold the legal estate on trust for each other. There are two ways in which joint owners can hold the equitable estate. They can either hold as joint tenants or as tenants in common. It is up to the owners decide which option they want to choose when they acquire the property and the choice will determine what assumptions the law will make as to the terms of the implied trust. Whichever option is chosen the legal estate can only ever be held as joint tenants (s36(2) Law of Property Act 1925).

It should be noted that no more than four people can hold the legal estate jointly.

Joint Tenants

This option is most common when the property is a home, rather than an investment. Where the property is held in this way all of the legal owners own the whole of the equitable estate. This means that if one owner were to die their interest would automatically pass to the survivors. Where there is one remaining survivor, the whole of the legal and equitable estates will pass to him and the trust will come to an end.

Where a couple purchase a property as joint tenants and the relationship subsequently breaks down so that the property has to be sold, then regardless of the actual contributions made to the purchase price the law assumes that the intention was that each party should be entitled to 50% of the equity.

Tenants in Common

Business partners, or couples who have children from previous relationships, will often elect to hold as tenants in common. Tenants in common are said to hold the equitable estate in shares, which can be equal or unequal. In the event of the death of one tenant in common that person’s share will pass via his will rather than to the survivors. Unlike joint tenants therefore, the trust does not come to an end when only one legal owner remains, since that person will hold the property on trust for himself and the estates of the deceased joint owners.

Although the equitable estate passes via a deceased tenant in common’s will, the legal estate does not, since as mentioned above the legal estate can only ever be held as joint tenants. Where property is held as tenants in common, the land registry will place the following restriction on the title “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 will prevent the property from being sold by a sole owner. Where the other joint owners are deceased, either their executors will need to join in the sale or a second trustee will need to be appointed by the survivor, usually in the transfer deed, to receive the sale proceeds. That trustee will be jointly responsible for ensuring that the equitable owners are properly accounted to.

Where two people hold as tenants in common and cannot agree on the split of the sale proceeds the courts will, in the absence of any evidence to the contrary, look to the shared declared when the property was acquired.

How to Choose Joint Tenancy or Tenancy in Common

When you buy a property with another it will be transferred to you with one of the land registry forms, TR1, TP1, TR2 or TP2. One of the boxes will be titled “Declaration of Trust” and you will have the option of choosing either joint tenants, tenants in common in equal shares or a third option, which is also tenants in common but allows you to specify unequal shares or to refer to a more complex trust document.

If you originally choose joint tenancy but then decide you wish to hold as tenants in common either party can sever the joint tenancy by serving notice in writing of your intention on the other party (who cannot refuse). Certain actions can also sever the joint tenancy whether or not the parties wish to sever, for example if one owner becomes bankrupt. A tenancy in common cannot be converted to a joint tenancy.

If none of the boxes in the transfer are checked the land registry will assume raise a requisition asking what the buyers’ intentions are but if response is received they will assume a tenancy in common was intended, however so far as the courts are concerned it will depend on the reason for the purchase. If the property is purchased as a home they will assume a joint tenancy whereas if it is an investment they will assume tenancy in common.

Trusts Arising Where There is Only One Legal Owner

Where a property has only one legal owner but another person has contributed to the purchase price, or contributes to the mortgage payments, a trust can still be created where nothing is put in writing. These types of trusts are called implied trusts and can be either “constructive” or “resulting”.

Resulting Trusts

Where a person buys a property and some or all of the money is provided by another person who is not a legal owner, and nothing is put in writing to say why the money is being provided (for example that is a gift or a loan), then the law assumes that the intention of the parties was that the property should be held on trust by the legal owner for himself and the provider of the funds. The equitable shares owned by each party will be directly proportional to their contribution to the purchase price, so if the property is purchased for £100,000 and the non-legal owner contributes £30,000 he will be entitled to a 30% share of the eventual sale price. The leading case on resulting trusts is Bull v Bull [1955], a case where a mother and son purchased a property jointly but the son was the sole legal owner.

Constructive Trusts

Constructive trusts arise where a non-owner contributes to the purchase price and/or mortgage payments and there is evidence of an agreement, or “common intention” that the non-owner should have an interest, for example in Eves v Eves [1975], the property was purchased in the sole name of Mr but with a contribution from Mrs. Mr told Mrs “if you had been 21 years old I would have put the property in our joint names”. Unlike a resulting trust, the equitable shares are decided on the basis of what is fair in the circumstances and not just the relative contributions (this was decided in Oxley v Hiscock [2004]). This can result in a party receiving a greater percentage than their original contribution.

Express Trusts

It is possible of course to put your intentions in writing when you purchase a property jointly. You would do this using a “Declaration of Trust”. As well as setting out the shares in which you want the property to be held, this document can detail other agreements such as who will make the mortgage payments, what happens if one party wants to sell etc.


Before buying property with someone else, whether or not they will be legal owners, you should think about what you want to happen with it. Think about what should happen upon death, or if your relationship breaks down.

If possible put your intentions in writing so that there is no expensive legal argument in future. You should talk your intentions through with a solicitor or property conveyancer so you can be sure you don’t overlook anything.

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