What are the key differences between joint tenancy and tenancy in common?
Joint tenancy includes the right of survivorship; when one joint tenant dies, their share passes automatically to the surviving joint tenant(s). Tenancy in common has no survivorship; when one tenant dies, their share passes through their estate according to their will or the state's intestacy laws. Joint tenants must have equal shares and equal rights; tenants in common can have unequal shares.
Key Takeaways
- Joint tenancy includes the right of survivorship.
- When one joint tenant dies, their share passes automatically to the surviving joint tenant(s).
- Tenancy in common has no survivorship.
- When one tenant dies, their share passes through their estate according to their will or the state's intestacy laws.
- Joint tenants must have equal shares and equal rights; tenants in common can have unequal shares.
Property Ownership & Land Use on the Real Estate Exam
Concurrent ownership (multiple owners on the same property) appears frequently on real estate exams. The distinction between joint tenancy and tenancy in common is critical because it determines what happens to an owner's interest when they die, whether the property passes probate, and what rights other owners have. Agents must understand these forms to advise clients about how to take title and to explain the consequences of different ownership structures.
Understanding Property Ownership & Land Use: Key Concepts
What It Means
Concurrent ownership means two or more people own the same property at the same time. The two main forms are joint tenancy and tenancy in common. They differ in how many 'unities' must exist and what happens when an owner dies.
Requirements
Joint tenancy requires four unities: (1) time, the interests must be created at the same time; (2) title, they must arise from the same instrument or transfer; (3) interest, each joint tenant must have an equal share; and (4) possession, each joint tenant has the right to possess the entire property. The most important characteristic is the right of survivorship. When one joint tenant dies, their interest does not pass to their heirs or through their will; it passes automatically to the surviving joint tenant(s). This is automatic by operation of law, not by will. For example, if three people own property as joint tenants with the right of survivorship and one dies, the remaining two own the property as joint tenants. If another dies, the last one is the sole owner.
Requirements
Tenancy in common requires only one unity: possession. Each tenant in common has the right to possess the entire property. However, tenants in common do not have the right of survivorship. Each tenant in common can own an unequal share (for example, one person could own 75% and another 25%). When a tenant in common dies, their share passes according to their will or, if they died intestate, according to the state's intestacy laws. The surviving tenants in common do not automatically acquire the deceased tenant's share.
Rights and Protections
Another important difference relates to transfer and lien rights. A joint tenant can unilaterally sever a joint tenancy by conveying their interest to another person or by encumbering the property with a lien. This destroys the joint tenancy and converts it to a tenancy in common. A tenant in common can freely transfer their share without the consent of the other tenants. If a judgment is entered against a tenant in common, a lien can attach to that person's interest specifically.
Consequences and Enforcement
The choice of ownership form has significant estate planning and tax consequences. Joint tenancy with right of survivorship can be used to avoid probate, but it also has implications for gift and income tax. Many states now presume tenancy in common unless joint tenancy is explicitly stated, because joint tenancy was historically disfavoured. Understanding which form applies is essential for accurate representation.
Property Ownership & Land Use Rules by State
Each state has its own rules when it comes to property ownership & land use. Here are a few examples of how requirements differ:
California
California Probate Code Section 11600 governs concurrent ownership. California presumes tenancy in common unless the deed explicitly states 'joint tenancy' or 'as joint tenants with right of survivorship.' For married couples, California recognizes community property as a form of concurrent ownership separate from joint tenancy. Joint tenancy in California avoids probate but may trigger reassessment for property tax purposes.
Texas
Texas Property Code Section 111.001 defines concurrent ownership. Texas presumes tenancy in common unless the deed clearly states joint tenancy intent. Texas also recognizes tenancy by the entirety for married couples (now available for same-sex couples as well), which is similar to joint tenancy but requires both spouses to execute transfers. The right of survivorship is valuable in Texas estate planning.
Florida
Florida Statutes Chapter 689.15 governs concurrent ownership. Florida presumes tenancy in common unless the instrument explicitly creates joint tenancy. Florida recognizes tenancy by the entirety for married couples, which includes the right of survivorship and provides creditor protections. For unmarried concurrent owners, both joint tenancy and tenancy in common are used, but tenancy in common is the default.
Expect at least one scenario question testing whether you know that when a joint tenant dies, the surviving joint tenant automatically receives the deceased's interest (no probate required). Also know that tenancy in common is the presumed default in most states unless joint tenancy is explicitly stated. Watch for questions about severing joint tenancy (a joint tenant can do this unilaterally by transferring to someone else). Be able to distinguish between the right of survivorship (joint tenancy) and succession through probate (tenancy in common).
Rules vary across all 50 states
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