Can a Joint Tenant Force the Sale of a Property?

Posted Mar 2, 2023


One of the common ways for people to hold title to property as a group is to buy it as joint tenants. In many states, joint tenancy is frequently employed by married couples and by business partners investing together. Joint tenants have equal ownership rights and responsibilities. A critical provision of joint tenancy is the right of survivorship—when one owner dies, the others inherit the deceased partner’s share. If there is more than one survivor, all would equally share the portion owned by the deceased.

It's important to note that while most states assume the right of survivorship in a joint tenancy ownership structure, Texas does not. In Texas, the co-owners must specify whether the co-owners have the right of survivorship. As a result, the property might go through probate if the group did not set that provision in the agreement.  

Unlike a tenants-in-common (TIC) structure, the joint tenants each have equal interests. Joint tenants must agree on the disposition of the property. If the owners use a TIC arrangement, each owner can hold an unequal share and has the right to dispose of their claim. They can accomplish the disposition by selling, transferring, or bequeathing it to someone else.

Why would a joint tenant group consider severing the agreement?

Several potential scenarios might lead a joint tenancy to seek dissolution of their ownership agreement. One of the most common is the divorce of a married couple holding property as joint tenants. In this example, the couple may include the joint tenancy disposition in the overall dissolution proceedings.

Sometimes a married or unmarried couple may decide to sever the joint tenancy even if they are not ending the relationship. In this case, the reason may be the desire to facilitate leaving the property to someone other than the partner. For example, suppose two married people own property as joint tenants but prefer to leave their individual ownership interests to someone other than their partner when they die. In that case, that is a good reason to switch from joint tenancy to tenancy-in-common.

Similarly, a group of business associates (or friends owning property as a group) might need to dissolve the partnership for various reasons. For example, one co-owner might need to sell, or the group might disagree about managing the property. The group must agree on the asset's disposition, so the disgruntled owner is stuck. The group may decide to reformulate the ownership, buying out the interest of one or more who want to exit. Or, the group might agree that it is time to sell the asset and move on to other investments. In that case, the joint tenant owners can sell the property amicably and dissolve the partnership.

What if the group can’t agree?

If the group as a whole won’t agree to sell or buy out the owner who wants to leave, that person may need to petition a court to order the dissolution of the agreement. A judge can require that the group either acquire the share of the dissatisfied member or conduct a sale. The remainder of the joint tenancy group can re-combine without the departing partner if they choose to.

This material is for general information and educational purposes only. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor.

Realized does not provide tax or legal advice. This material is not a substitute for seeking the advice of a qualified professional for your individual situation.

Download The Guide To Tenants-In-Common

The Investor's Guidebook to TIC's
Download eBook


The Investor's Guidebook to TIC's

Download The Guide To Tenants-In-Common

See if Tenants-In-Common Investments are right for you.

By providing your email and phone number, you are opting to receive communications from Realized. If you receive a text message and choose to stop receiving further messages, reply STOP to immediately unsubscribe. Msg & Data rates may apply. To manage receiving emails from Realized visit the Manage Preferences link in any email received.