There are several options to consider when deciding how you should own a property. Here are some of them:

  • Joint ownership – this is where two or more individuals own the property. On the death of one party, the property passes to the survivor/s, irrespective of any provisions in a Will. You may not want this to happen, especially if you are in a subsequent relationship as it would mean children of a prior relationship will not inherit their parent’s share in the property.
  • Tenants in common – this means you own a specified share in the property, either in equal or unequal shares. You can leave your share in the property to beneficiaries named in your Will, for example, children of a prior relationship.
  • Joint Family Home – designed to give some protection to a spouse and children from business debts of the other spouse. This is only available to married couples.
  • Family trust – can protect a major asset against creditors and other risks, and also provides an effective estate planning tool.
  • LAQC – an ownership structure often used for rental properties.

If you make unequal contributions to the purchase price it would be advisable to record the details in a Property Sharing Agreement. You should talk to your lawyer about this.

Another important issue to consider is the possible impact of the Property (Relationships) Act. The provisions of the Act apply to all relationships in the nature of a marriage. In relationships that last for 3 years a home will generally be divided equally on separation. Remember, you do not have to be living together for three years under the same roof for the Act to apply. This may affect you if you are in a relationship and own or are buying a property in your sole name or in unequal shares. If that is the case you need a written Property Agreement with your partner.

Individuals are also at risk if they commence a relationship after buying a property. If that relationship lasts 3 years, the property may become relationship property and be divided equally on separation. Single people should seriously consider a Family Trust owning their property to protect against this risk. If a relationship commences subsequent to purchase, you need a Property Agreement with your new partner to protect you.