What cohabiting couples need to check before buying a property together

Buying a property with your partner marks an exciting milestone in the relationship but it’s important to lead with logic, not just love. It’s one of the biggest investments you’ll make, both financially and emotionally, so making sure you have the right legal structure in place is crucial for avoiding issues down the line. Illness, separation, or changes in financial circumstances can impact future situations such as remortgaging the property or ownership problems. 

Fortunately, cohabiting couples buying together have several options to properly structure the home ownership, and to protect the interests of everyone involved in the purchase. 

Here are a few things to consider before buying a property as a couple: 

Risks to be aware of when buying with a partner 

When purchasing a property with a partner, it is important to understand that cohabiting couples do not have the same legal protections as married couples or those in a civil partnership. In England and Wales, there is no legal status of ‘common law’ marriage, which means rights are not automatically established through living together alone. 

Without the appropriate legal documentation in place, your wishes regarding inheritance and ownership may not be followed. For example, if one owner dies, the surviving partner will not necessarily inherit their share unless this has been formally arranged. 

Financial contributions also do not automatically determine ownership. Even if one party pays a larger deposit or contributes more towards the mortgage, this doesn’t give them a greater share of the property by default. If the property is intended to be owned in unequal proportions, this must be agreed and clearly set out at the time of purchase. 

Ownership arrangements can be changed later, but only with the agreement of all parties involved. 

Choosing between Joint Tenancy and Tenancy in Common 

When buying a property together, you will need to decide how it will be legally owned. The two main options are joint tenancy and tenancy in common, and the right choice depends on your circumstances and plans for the future.  

During the course of ownership, other questions may arise such as how the property would be valued if an owner wishes to sell their share, whether the existing owners should have first refusal, and whether an owner can leave their share to someone else in their will. 

To help address these matters and provide clarity for everyone involved, a Declaration of Trust or Cohabitation Agreement can be put in place. These documents set out clear arrangements in advance, helping to reduce uncertainty, minimise disputes, and provide reassurance if circumstances change. 

What is Joint Tenancy? 

Under a joint tenancy, all owners (up to a maximum of four) collectively own the entire property. This is often considered the simpler option and is commonly used by couples purchasing together. 

A key feature of joint tenancy is the right of survivorship. This means that if one owner dies, their interest in the property automatically passes to the surviving owner(s). The deceased person cannot leave their share of the property to someone else in their will. 

However, joint tenancy does not reflect unequal financial contributions. If one party pays a larger deposit or contributes more towards the mortgage, this cannot be recognised within the ownership structure itself. In such situations, tenancy in common may be more suitable. Alternatively, a Declaration of Trust or Cohabitation Agreement can be used to protect individual interests where contributions differ. 

What is Tenancy in Common? 

With tenancy in common, each owner holds a distinct share in the property. These shares can be equal or unequal, depending on what is agreed - for example, 50/50 between two owners, or different percentages where financial contributions vary. 

This option requires careful discussion from the start, particularly if the shares are unequal. The agreed split is legally binding, providing clarity about each person’s entitlement and helping to prevent disputes when the property is sold. Each owner knows in advance the percentage of the sale proceeds they will receive. 

Tenancy in common also offers greater flexibility. An owner can sell their share or leave it to someone else in their will, even if that person is not currently a co-owner. 

To reduce the risk of uncertainty or conflict, tenants in common may wish to put a legally binding agreement in place such as a Declaration of Trust or Cohabitation Agreement to set out what should happen if one owner wishes to sell or passes away. 

Declaration of Trust 

A Declaration of Trust is a legal document that sets out and confirms the beneficial ownership shares between property owners, particularly where these differ from a standard equal split. Without this, the proceeds from a sale would generally be divided equally between joint owners. 

For example, if one party contributes the entire deposit, a Declaration of Trust can ensure that this amount is repaid solely to them upon sale, potentially with interest or adjusted to reflect any increase in the property’s value, before the remaining proceeds are distributed according to the agreed shares. 

This type of agreement can also protect the interests of someone who is contributing financially but is not listed as a legal owner such as a gifter providing funds towards the deposit. 

If you are considering your options, it’s best to speak with your solicitor at the earliest opportunity in the conveyancing process to ensure the arrangements reflect your intentions and circumstances. 

 Cohabitation Agreement 

A Cohabitation Agreement serves a similar purpose to a Declaration of Trust and is legally binding in the UK when properly drafted. It allows couples who live together to set out clear arrangements regarding their property and wider financial responsibilities. 

This type of agreement specifies how the proceeds from the sale of a jointly owned property should be divided if the relationship ends and the property is sold, or if one owner dies. They can also detail each party’s responsibilities in relation to the mortgage, household bills, and day-to-day living expenses, helping to avoid uncertainty or dispute.  

It’s also worth knowing that a Cohabitation Agreement is particularly important in situations where one partner cannot be named on the deed and so there is just one registered owner. This kind of agreement allows legitimate recognition of non-financial contributions such as full-time childcare, or financial contributions to the deposit or mortgage. 

Preparing for the future 

It can feel uncomfortable to raise questions about what might happen if a relationship breaks down or circumstances change. Thinking about separation, ownership disputes, or how contributions are recognised is not easy and may feel like it’s taking away from the excitement of buying a home together. 

However, discussing these issues early on is simply a practical and sensible step. Rather than viewing it as anticipating the worst, it can be helpful to see it as part of the legal process recommended by your conveyancer to ensure clarity and protection for everyone involved. 

Having open conversations about ownership shares and putting appropriate agreements in place is also a constructive way to recognise each person’s financial and non-financial contributions. It ensures that expectations are aligned and that everyone understands their position from the outset. 

By formalising arrangements at the beginning, you reduce the risk of confusion or disagreement later on. Clear documentation can provide reassurance, protect relationships, and help avoid unnecessary stress, cost, and uncertainty in the future. 

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