Whenever you buy property in British Columbia with someone else, you must decide how the ownership will be shared. There are 2 main options in which a property can be shared, joint tenancy and tenancy in common. They both work differently, so it is important to understand them first. Knowing the difference helps couples, business partners, investors, and families choose the best option when buying property in BC.
Joint Tenancy
Joint tenancy is a way to own property together where each owner has an equal share in the whole property. This means all the owners own the property together. They do not have separate portions in the property. If one of the owners dies, then the share automatically goes to the other owner(s) without going through a will or the court process.
Advantages of the Joint Tenancy
- Property passes directly to surviving owners
- It reduces delays and costs
- Everyone holds equal interest
- Clear for estate planning between spouses
Tenancy in Common
Tenancy in common is a type of shared ownership where each co-owner holds their own separate share of the property. These shares can be equal or different in size. Moreover, the co-owner’s share does not automatically transfer to the others if they pass away. Under a Tenancy-in-Common, the share is treated as a separate asset. If an owner passes away, their share does not automatically go to the other owners. Instead, it passes to whomever they named in their Will.
Advantages of Tenancy in Common
- Owners can choose different share sizes based on how much they pay.
- You can decide who inherits your share
- Good for investment properties or business partners.
- Easy to add new owners or remove existing ones.
Key Differences Between Joint Tenancy and Tenancy in Common
| Feature | Joint Tenancy | Tenancy in Common |
| Right of Survivorship | Yes | No |
| Ownership Shares | Equal only | Can be equal or unequal |
| Transfer Upon Death | Passes automatically to surviving owner(s) | Passes to estate/heirs |
| Changing Ownership | Changing shares usually breaks joint tenancy | Shares can be sold or transferred freely |
| Common Users | Spouses, long-term partners | Siblings, investors, business partners |
Deciding Between Joint Tenancy and Tenancy in Common
Your choice depends on the relationship with the other owners and your future plans.
Choose Joint Tenancy If:
- You want the property to pass directly to your spouse or partner.
- You prefer a simple ownership structure.
- You want to avoid probate for this asset.
Choose Tenancy in Common If:
- You want to control over who inherits your share.
- You are buying with someone other than a spouse.
- You are contributing unequal amounts to the property purchase.
- The property is an investment rather than a family home.
Can You Change Ownership Type Later?
Yes. Owners can convert joint tenancy into tenancy in common by severing the joint tenancy. This may be done:
- Voluntarily with a written agreement, or
- Unilaterally by one owner (in some cases),
- Through changes in legal arrangements or property transfers.
However, changing ownership type may have legal and tax effects, so professional advice is recommended.
Conclusion
Selection between Tenancy in Common and Joint Tenancy is not an impossible thing to decide. Simply read the characteristics of each option and select which suits your situation appropriately. Whether you are buying a home with your partner or investing with friends or family, understanding these options ensures your property is protected as well as aligned with your long-term goals. Additionally, if you aren’t sure about anything, consider speaking with an estate planning lawyer in BC who can guide you based on your personal needs.
