How to handle a joint ownership property if one party wants to sell
Joint ownership of a property simply refers to two people who each have a share in their property. For the purposes of this blog this could include cohabitating couples or friends/family members who own a property together. Whether you are a joint owner with your partner, family member or a friend, relationships sometimes break down or circumstances change, which can lead to one joint owner wanting to sell their shared property.
The breakdown of a relationship can be difficult, without the added pressure of selling your joint property. Typically, if one person wants to sell the property then both parties need to agree in order for the sale to go ahead without having to involve the Courts.
Read on to discover your legal rights and how to handle a joint ownership property if you, or your joint partner, want to sell.
Can a joint owner buy the full property?
If the other joint owner of your property would like to sell, but you do not want to sell, it could be an option to buy them out. Buying them out would mean you can live in the property and full ownership will be transferred to you.
To buy out your friend or partner from joint ownership, you’ll need enough cash to be able to buy out their share of equity in the property – and they’ll need to agree, of course.
If they don’t agree then an application could be made to the Court for an order under the Trusts of Land Appointment of Trustees Act (referred to as TOLATA) requiring them to transfer their interest to you. In order to be in this position you would first have to obtain evidence as to what the likely value of their interest would be (taking into account, the value of the property, the proportion of their share, any mortgage or charges outstanding and the notional costs of sale). There are some other more complex calculations that may need to be done if the separation happened some time ago but for the purposes of this blog we will not go into the detail of that. Once you have an idea of the value (which will ultimately be determined by the Court) you will then need to show that you are in a position to purchase their share for the required price.
If the Court gives you an opportunity to purchase their share for a specified sum then you will usually only have a defined period in which to do so following which the property is likely to have to be sold.
Can a joint owner of a property force a sale?
If you would like to sell the property but your partner does not or vice versa then one party can force a sale unless there are some specified circumstances which could prevent it (usually in relation to children).
If the matter cannot be settled by pre-action correspondence then one party would commence proceedings under TOLATA seeking an order that the Property be sold and specified terms as to what should happen to allow that to happen.
Seeking advice from a cohabitation solicitor
Whether you are looking to sell your joint ownership property, buy out the other party or are refusing the sale or transfer, we recommend you seek professional advice from our cohabitation dispute solicitors. Our specialist solicitors can provide you with clear advice and assist you with the next steps.