Buying a property with several people without being a couple is becoming increasingly common. Siblings may buy a family holiday home together, while friends may pool their savings to invest in a rental property.
In these situations, joint ownership (indivision) is often the default solution when other legal structures have not been considered.
Although relatively simple to set up, joint ownership is governed by specific rules that are important to understand before signing the purchase deed with the notary.
This article explains how ownership shares work, why a joint ownership agreement can be useful, the applicable majority rules and the options available if one co-owner disagrees with the others or wishes to leave the arrangement.
In summary
- Buying property in joint ownership with friends or family means becoming co-owners, with each person holding a share that is generally proportionate to their financial contribution.
- A joint ownership agreement can define in advance how expenses will be divided, establish pre-emption rights between co-owners and determine the duration of the arrangement.
- Major decisions, such as selling the property or carrying out significant renovation work, require the unanimous agreement of all co-owners, while day-to-day management decisions can generally be taken by co-owners representing at least two-thirds of the ownership rights.
- A co-owner who wishes to leave can have their share bought out by the other co-owners, sell their share to a third party or, as a last resort, request a court-ordered sale of the property.
- Choosing your co-owners carefully and clarifying everyone's objectives from the outset can significantly reduce the risk of future disputes.
- Working with a real estate professional and a notary helps secure the arrangement from the moment the property is purchased.
Why Buy Property in Joint Ownership with Friends or Family ?
Joint ownership is the default legal arrangement whenever several people purchase a property together without setting up a Société Civile Immobilière (SCI), or French property-holding company.
Contrary to a common misconception, joint ownership is not limited to unmarried couples or heirs. It is also frequently chosen voluntarily by relatives or friends who want to invest in property together.
Siblings Buying a Second Home Together
One common example is siblings deciding to jointly purchase a family holiday home.
They may want to maintain a place where the family can gather after their parents have passed away, or simply share the cost of a second home that none of them could afford individually.
Joint ownership allows them to divide not only the purchase price but also ongoing expenses such as maintenance costs, property tax and renovation work.
Each co-owner can then use the property according to an agreed schedule, for example by allocating specific weeks or periods of the year to each household.
Friends Buying a Rental Investment Together
Another common situation involves friends jointly purchasing an apartment as a rental investment, allowing them to build property assets together without waiting until each person has sufficient borrowing capacity to invest alone.
This type of project requires a strong relationship between the co-owners, as management decisions—including choosing tenants, setting the rent and carrying out renovation work—must be made collectively.
In both situations, it is worth comparing joint ownership with other legal structures, particularly when only two people are involved. Options such as an SCI or a tontine clause may be more appropriate depending on the circumstances.
Joint Ownership Shares: A Principle Based on Each Person's Financial Contribution
When several people purchase a property in joint ownership, each person owns a share of the property, expressed as a percentage or fraction—for example, one-third or one-half.
In principle, this share should reflect the amount each person has actually contributed to the purchase, including their personal deposit and their share of the mortgage repayments.
A co-owner who finances 60% of the purchase price would therefore theoretically own 60% of the property.
It is essential for the notarised purchase deed to accurately reflect how the property has actually been financed.
If the ownership shares do not correspond to each person's real financial contribution, the difference could potentially be treated for tax purposes as an indirect gift, with possible consequences for transfer duties.
For example, if three friends purchase a property for €300,000, with one contributing €150,000 and the other two contributing €75,000 each, the logical ownership shares would be 50%, 25% and 25% respectively.
Each co-owner remains free to sell, gift or transfer their own share without requiring the agreement of the others for a transaction relating solely to their individual ownership rights.
The Joint Ownership Agreement: Planning How the Property Will Be Managed
The standard legal joint ownership arrangement is deliberately flexible, but it can also be restrictive in certain respects. It has no fixed duration and can lead to deadlocks when no written rules have been agreed in advance.
For this reason, it is strongly recommended to draw up a joint ownership agreement (convention d'indivision), usually with the assistance of a notary when the property is purchased.
Dividing Expenses and Organising Use of the Property
A joint ownership agreement can clearly define how expenses will be divided between the co-owners, including:
- property tax;
- co-ownership charges;
- insurance;
- routine maintenance and repairs.
It can also establish rules governing how the property will be used.
This is particularly useful for a family second home where several households want to use the property at different times. For example, the agreement can establish a booking schedule by season, month or specific periods of the year.
Establishing Pre-Emption Rights Between Co-Owners
Another major advantage of a joint ownership agreement is the possibility of including a pre-emption right between the co-owners.
If one co-owner wishes to sell their share, the other co-owners are given priority to purchase it before it is offered to an outside third party.
This provision helps prevent an unknown third party from becoming a co-owner of the property without the others having had the opportunity to purchase the share first, which can be particularly reassuring for family-owned properties.
Setting the Duration of the Agreement
A joint ownership agreement can be entered into for either a fixed renewable period or an indefinite period.
A fixed term—often five years and renewable—has the advantage of creating regular opportunities for each co-owner to reconsider whether they wish to remain involved in the project.
Decision-Making Rules: Unanimity and the Two-Thirds Majority
Joint ownership is governed by different majority rules depending on the type of decision being made.
Understanding the distinction between them can help prevent many disagreements between co-owners.
Unanimous Agreement for Major Decisions
Certain decisions have a significant impact on the property and therefore require the agreement of all co-owners.
These include:
- selling the entire property;
- gifting the property;
- entering into a commercial or agricultural lease;
- carrying out major construction or renovation work that substantially alters the property.
A single co-owner can therefore block this type of decision, highlighting the importance of having a good relationship with the people you choose to buy with.
A Two-Thirds Majority for Day-to-Day Management
The rules are more flexible for ordinary management decisions.
These can generally be made by co-owners representing at least two-thirds of the joint ownership rights.
This can include, for example:
- carrying out maintenance work necessary to keep the property in good condition;
- entering into or renewing a residential lease;
- appointing one of the co-owners to manage the property on a day-to-day basis.
The two-thirds rule helps prevent a single minority co-owner from blocking the normal management of the property when the decision does not fundamentally affect ownership itself.
What Happens if One Co-Owner Wants to Leave the Joint Ownership Arrangement?
Joint ownership between friends or family members can last for many years, during which personal circumstances may change, such as marriage, relocation or a need for additional funds.
Several options are available when one co-owner wishes to leave.
The Other Co-Owners Buy Out Their Share
The most common solution is for the remaining co-owners to buy the departing co-owner's share, either in proportion to their existing ownership shares or according to another arrangement agreed between them.
This usually requires additional financing, either through personal funds or a loan, and a notarised deed confirming the transfer of ownership.
It is generally the simplest solution when the remaining co-owners want to keep the property and have the financial means to do so.
Selling the Share to a Third Party
If the other co-owners do not wish to—or cannot afford to—buy the share, the departing co-owner is, in principle, free to sell their share to a third party, subject to any applicable pre-emption rights.
In practice, however, this option is relatively uncommon because it can be difficult to find a buyer willing to purchase only a share of a jointly owned property without having full control over how the property is used.
A Court-Ordered Sale as a Last Resort
If no amicable solution can be found, any co-owner may ask the court to order the division of the jointly owned property, potentially resulting in the sale of the entire property despite opposition from the other co-owners.
This judicial process is longer and more expensive than an amicable sale and may ultimately result in the property being sold at auction if the co-owners cannot agree on a price or buyer.
This highlights why it is preferable to anticipate potential disagreements when purchasing the property rather than allowing the situation to deteriorate over time.
Precautions to Take Before Buying
Buying property in joint ownership with friends or family can be a suitable solution, provided that a few important foundations are established from the outset.
Choose Your Co-Owners Carefully
Joint ownership requires a long-term relationship of trust with the people you are buying with.
It is advisable to enter into this type of arrangement only with people whose financial circumstances and reliability you understand.
If one co-owner can no longer pay their share of the mortgage or property expenses, this can create financial difficulties for the entire group.
Clarify Everyone's Objectives from the Start
Before signing, it is important to openly discuss what each future co-owner expects from the project.
For example:
- Is the property primarily intended for personal use?
- Is it a rental investment expected to generate a return?
- How long does each person expect to keep their share?
Different objectives that are not discussed at the outset are among the most common causes of future disagreements between co-owners.
Anticipate Disagreements in Writing
The best precaution is to anticipate potential disagreements in writing through the joint ownership agreement and, where the value of the property or complexity of the situation justifies it, with the assistance of a notary or specialist lawyer.
Including provisions covering exit arrangements, pre-emption rights and the division of expenses from the moment the property is purchased can prevent many disputes that might otherwise arise only when one co-owner wants to sell.
These precautions can also prove valuable if the property is later inherited and several heirs become joint owners.
Work with an Optimhome Real Estate Advisor
Buying property in joint ownership with friends or family is easier to manage when you receive professional support from the beginning of your property search.
A local Optimhome real estate advisor understands the specific characteristics of the local market and can help you identify a property suited to shared ownership, whether you are looking for a family second home or a rental investment with friends.
Before you even begin arranging viewings, an online property valuation can provide an initial indication of local property values and help you assess the budget each future co-owner will need to contribute.
You can also browse Optimhome property listings to refine your search and explore the services available to buyers, designed to support you throughout the process, from finding the right property to signing the final deed with the notary.
Conclusion
Buying property in joint ownership with friends or family is an accessible arrangement and often the default choice, but it deserves to be prepared just as carefully as any other property purchase.
- Each co-owner holds a share that should, in principle, reflect their actual financial contribution.
- A joint ownership agreement can define in advance how expenses will be divided, establish pre-emption rights and determine the duration of the arrangement.
- Major decisions require unanimous agreement, while day-to-day management decisions can generally be made by a two-thirds majority.
- If one co-owner wishes to leave, an amicable buyout of their share should be considered before resorting to a court-ordered sale.
- Choosing your co-owners carefully and clarifying everyone's objectives from the outset remain the best ways to prevent future deadlocks.
Working with a real estate professional and a notary from the purchase stage can help secure this type of shared property project and avoid unpleasant surprises several years later.
FAQ
Can You Buy Property in Joint Ownership Without Being Related or in a Relationship?
Yes. Joint ownership is not limited to couples or heirs.
Two friends, several colleagues or even acquaintances can purchase a property together in joint ownership, provided that their respective ownership shares are clearly defined in the purchase deed.
Do All Co-Owners Have to Hold Equal Shares?
No. Each co-owner's share should, in principle, reflect their actual financial contribution to the purchase rather than being divided equally by default.
An ownership share that is disproportionate to the person's actual contribution could potentially be treated for tax purposes as a gift.
Is a Joint Ownership Agreement Mandatory?
No. A joint ownership agreement is not mandatory, but it is strongly recommended when several unmarried individuals purchase a property together.
It allows the co-owners to anticipate how expenses will be managed, how the property will be used and under what conditions each co-owner can leave the arrangement.
What Happens if One Co-Owner Stops Paying Their Share of the Expenses?
The other co-owners can advance the amounts due and seek reimbursement later, particularly when the property is divided or sold, taking into account the amounts owed between the co-owners.
The joint ownership agreement can also establish specific procedures for dealing with this type of situation.
Can a Co-Owner Sell Their Share Without the Agreement of the Others?
In principle, yes. Each co-owner remains free to dispose of their own share.
However, a joint ownership agreement may provide the other co-owners with a pre-emption right, meaning they must be given priority and informed before the share is sold to an outside third party.
How Can You Leave Joint Ownership if the Other Co-Owners Refuse to Sell?
If no amicable agreement can be reached, a co-owner may ask the court to order the division of the property, which can ultimately result in a forced sale at auction.
However, court proceedings should remain a last resort, as they are generally longer and more expensive than a negotiated solution between the co-owners.
Is an SCI Better Than Joint Ownership When Buying with Friends?
It depends on the project.
Joint ownership is generally simpler and less expensive to set up, while an SCI (Société Civile Immobilière) provides greater flexibility for organising decision-making and planning the gradual transfer of company shares.
A real estate advisor or notary can help you compare the two options according to your project and individual circumstances.
Author :
Fabrice DOBROWOLSKI - Optimhome Network Development Director
Optimhome offers you personalized support for your real estate project. Benefit from all my advice, based on several years of experience, to ensure the success of your project.
