Be aware of house-sharing dilemmas

Published by on 16 June 2010.
Last updated on 14 May 2013

Q: Two years ago I bought a two-bedroom flat with a friend. She has now decided to go travelling for a year and wants to rent her room out. Although I'm not happy living with a lodger, she says as long as she pays her share of the mortgage I can't stop her. What rights have I got? I would rather sell the property than live with a stranger.

A: Thomas Moran is a partner for Speechly Bircham

Ideally you and your co-owner should have a written agreement or trust deed setting out who is to live at the property and what happens if one of you wants to sell.

However, if there's no written agreement, then you need to consider the general law. There is no implied legal requirement for a co-owner to live in a property.

But when two or more people own one property, then the law implies a trust, so that co-owners hold property as trustees for themselves. This applies whether they hold it as joint tenants or tenants in common.

Trustee decisions must be unanimous – this means that your co-owner should not be able to rent out their room to somebody else without your consent.

If there's a mortgage on the property, there might also be mortgage terms which restrict who can live in the property, so check out the terms on your contract.

If you can't reach an agreement, it is possible for you to break the deadlock by applying for a court order to force a sale.

Sharing with a friend: the basics

Buying a house with a friend is different to a partner or family member: aside from the potential to fall out over a messy kitchen the level of commitment is less strong.

Ask yourself the following questions:

What will happen in the event of someone wanting to move out?

Have you lived with the person before and do you think you will get on for at least a few years?

Do you think your friend is financially reliable to pay their share of the mortgage? And do you feel happy being financially linked to them?

Up to four people can be listed on the deeds of a property; however the more people you share a mortgage with, the bigger potential difficulties you will face. For example, if one of the owners falls into debt and can’t make their mortgage payments, the remaining owners will be expected to pay it.

Ensure legal documents are drawn up right from the outset that outline how the property will be divided up in the event of death or if one housemate wants to enter out of the mortgage.

Ask your solicitor to register you and your friends as ‘tenants in common’ rather than ‘joint tenants’ so that if one of you dies, the deceased’s share of he property goes to an assigned beneficiary instead of being re–divided between the remaining homeowners.

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