Joint Tenancy vs. Tenants in Common: What's the Difference?

Note that while the term "tenancy" is used in rental situations, in this context it refers to ownership interest in a property. The owners in these arrangements would be referred to as joint tenants or tenants in common and are not renters.

What is joint tenancy?

Joint tenancy is a form of property ownership where two or more people hold equal interest in a property with equal rights, and when one owner dies, their share automatically transfers to the surviving owner(s). This automatic transfer is called the right of survivorship. The most common example is a married couple purchasing a home together.

For a property to qualify as joint tenancy, four conditions must be met:

• All tenants must obtain the property at the same time
• Each tenant must hold an equal share of ownership
• All tenants must acquire their interest from the same title document
• All tenants must have equal rights to use and occupy the entire property

According to Gagan Saini, the director of acquisitions of JiT Homebuyer, a real estate solutions and investment firm in Metairie, Louisiana, a joint tenancy agreement requires owners to agree on any decisions about the property. "This includes decisions such as when to sell the property, who is responsible for maintenance and repairs, and how the profits from the sale of the property are divided," Saini says.

Advantages of joint tenancy

There are many advantages of joint tenancy.

• Right of survivorship: When one co-owner dies, ownership automatically transfers to the remaining owner(s) without going through probate
• No transfer taxes for spouses: A surviving spouse becomes full owner without owing transfer taxes
• Equal ownership: All parties hold equal shares—two owners each control 50%, five owners each control 20%

If unmarried persons own property in joint tenancy, surviving owners also avoid probate, though they may need to claim the inherited property as a gift.

Disadvantages of joint tenancy

Here are the major disadvantages of joint tenancy.

• Creditor exposure: If one tenant owes a debt, a creditor can terminate the joint tenancy—even if other co-owners have nothing to do with that debt
• No inheritance control: Ownership automatically passes to co-owners, not to your chosen heirs
• Partition actions: If co-owners disagree on what to do with the property, resolving disputes requires filing a costly and time-consuming lawsuit

If you're considering joint tenancy with someone who has bad credit, significant debt, or works in a liability-prone profession, weigh these risks carefully.

What is tenancy in common?

Tenancy in common (TIC) is a form of property ownership where two or more people hold title together, but each owner can hold different percentage shares and sell their interest at any time without the other owners' consent. Unlike joint tenancy, there is no right of survivorship—each owner can leave their share to anyone they choose in their will.

Even if one owner holds 30% and another holds 70%, both have equal rights to use the entire property. This is called undivided interest.

Additionally, on the occasion of their death, each co-owner may choose who will be the beneficiary of their ownership as part of their estate.