50/50 House Ownership: 4 Things to Keep In Mind

Did you know that the average home in the United States cost over $428,000 in 2022? That was a 30% increase from the same point in 2020. 

With homes getting more and more expensive, it can leave a lot of renters questioning if they have the money to own a home. To get around this, some people decide to split house ownership evenly with a friend or family member. 

While this can save you money on paper, there are legal implications that you should know before you go ahead with this arrangement. Here are four things you should keep in mind. 

1. Tenants in Common Agreement 

One type of arrangement that multiple homeowners can make is to be tenants in common. This provides a flexible option for people who want to split home ownership. 

It allows two people to only 50% of the shares to a home each if they so desire. However, if one person wants to be a majority owner, this can be arranged with this type of agreement as well. 

2. Right of Survivorship 

The next thing that joint homeowners should keep in mind is what happens to their shares in the event one of them passes away. Even homeowners on the younger side should consider this clause because it can severely impact the person they are sharing the home with. 

In this type of arrangement, it can give the other homeowner the first opportunity to buy the deceased person’s shares. Otherwise, those shares would likely end up with the deceased person’s next of kin. If that happens, it can leave the surviving homeowner in jeopardy of losing their home. 

For this type of clause, you may want to speak to a lawyer such as the one below: 

www.underwood.law/irvine-partition-lawyers.html

3. Right of First Refusal 

Similar to Right of Survivorship, this clause allows a homeowner that wants to keep their home to have the first opportunity to buy out a joint homeowner that wants to sell their shares. 

This is beneficial for two reasons. It prevents a random stranger from moving into the home with the homeowner that wants to stay. Along with that, it can prevent any possibility of that new homeowner wanting to sell the property themselves. 

4. Bill Responsibility 

Finally, you are going to want to make it clear how you are going to split bills for the household. You should consider every aspect of this before signing a deed to the house with a joint owner. 

This can be anything from utilities to electricity, routine maintenance, property taxes, the mortgage, and more. You should also come up with a clause that determines when upgrades, renovations, and maintenance on the house are allowed to be performed. 

Learn More About 50/50 House Ownership

These are just four important things that you need to consider if you are going to go into joint ownership with somebody. Make sure there are options to buy the other person’s shares, come up with a plan for splitting bills, and determine what type of arrangement you want for house shares. 

Do you want to know more about the legal side of house ownership? Keep browsing our blog for more helpful posts.