Property Ownership in New Zealand: Joint Tenants vs Tenants in Common

Buying a property with another person — whether that’s a partner, a family member, or a friend or acquaintance so that you can get onto the property ladder, is a major commitment. Yet many people don’t realise that how you choose to legally hold the property can have significant consequences, both during your lifetime and after you die.

In New Zealand, when more than one person owns a property, there are two main ways to hold that ownership:

• Joint tenants

• Tenants in common

Each option comes with its own rules, benefits, and drawbacks. The choice isn’t one-size-fits-all. Instead, it depends on your personal circumstances, your goals for the property, and what you want to happen if one of the owners passes away.

In this article, we’ll unpack what these terms mean, why the choice matters, and the consequences of getting it right — or wrong.

What Does Joint Tenancy Mean?

When property is owned as joint tenants, all owners hold the property together, with no separate or defined shares. In law, they are regarded as owning the whole property as a single unit.

Key features include:

• No divided shares: Each joint tenant is treated as owning the entire property, not a percentage.

• Right of survivorship: If one joint tenant dies, the property automatically passes to the surviving owner(s). The deceased’s interest cannot be left to anyone else in their Will.

• Administration is simple: Ownership passes by survivorship rather than through probate, provided the deceased has no other assets over $40,000 that would trigger the need for probate.

This form of ownership is common between spouses and partners, because it ensures the surviving partner automatically inherits the property without delay.

Example: Anna and James buy their family home as joint tenants. If Anna passes away, James automatically owns the property outright, regardless of what Anna’s Will says.

What Does Tenancy in Common Mean?

By contrast, tenants in common each hold a distinct, defined share in the property. Those shares can be equal (50/50) or unequal (for example, 70/30), depending on how much each person contributed to the purchase or how they want ownership recorded.

Key features include:

• Defined shares: Ownership is split into clear proportions.

• Shares pass under a Will: If one tenant in common dies, their share forms part of their estate and is dealt with under their Will (or under the Administration Act 1969 if they have no Will).

• Probate required: Where a deceased owner’s estate exceeds $40,000, probate or letters of administration will be needed to transfer their share.

This option is often chosen where owners want more flexibility and control over what happens to their interest in the property.

Example: Priya and her brother Arjun purchase a rental property together as tenants in common, with Priya owning 60% and Arjun 40%. If Priya passes away, her 60% share goes according to her Will — perhaps to her children — rather than automatically to Arjun.

Why Does the Choice Matter?

At first glance, the difference might seem like a technicality. But in practice, the decision can affect:

1. Who inherits your property

   • Joint tenants: your co-owner(s) will inherit automatically.

   • Tenants in common: your estate decides, via your Will.

2. Family protection and succession planning

   • If you’re in a blended family, joint tenancy could unintentionally (or intentionally) exclude your children.

   • Tenancy in common allows you to pass your share to children or other beneficiaries.

3. Relationship property claims

   • In relationship breakdowns, the way ownership is structured can impact how assets are divided.

4. Residential care costs and asset protection

   • Owning as tenants in common, and providing a life interest to a surviving spouse, can help protect against rest-home costs or claims by future partners.

5. Administration on death

   • Joint tenancy simplifies the transfer — only a Transmission by Survivorship and a death certificate are needed.

   • Tenancy in common requires probate if the estate is over $40,000, which involves more time and cost.

Disputes Around Ownership

Sometimes, disputes arise about how property is owned — particularly when the title documents don’t reflect the reality of contributions.

For example:

• A couple might assume they are joint tenants, but the title shows tenants in common.

• Family members may disagree on whether contributions entitle one person to a larger share.

In such situations, the courts may be asked to determine ownership based on contributions and the parties’ intentions. This can be stressful, expensive, and avoidable with good advice at the outset.

A Property Sharing Agreement is highly recommended where two or more people are purchasing property together. This agreement records ownership shares, responsibilities for mortgage payments and outgoings, and what happens if one party wants to sell or if there’s a relationship breakdown.  This document is different to a Contracting Out Agreement, which is a document that people in a qualifying relationship under the Property (Relationships) Act 1976 would put in place.

The Role of a Will

Your Will interacts closely with how you own property:

• Joint tenants: Your Will does not control what happens to your share. The property automatically passes to the surviving owner(s).

• Tenants in common: Your Will determines who inherits your share.

This is why reviewing your Will alongside your property ownership is critical. It ensures your intentions are clear and legally effective.  It can also be helpful if you wish to avoid having to satisfy your moral obligation which requires you to leave assets to estranged children, if this was important to you.

Probate threshold: From 24 September 2025, probate is required where assets exceed $40,000. If your estate (including your share in a property) is above this threshold, your executors will need probate before transferring ownership.

Why Give a Partner or Spouse a Life Interest?

One option available with tenancy in common is to grant your surviving spouse or partner a life interest in your share.

This allows your partner to:

• Continue living in the property, or

• Receive income from it,

for their lifetime. When they die, your share then passes to the ultimate beneficiaries you’ve chosen (often your children).

This arrangement can:

• Protect your share of the property from being lost to your surviving partner/spouse's new partner.

• Prevent your share being consumed by rest home/residential care costs.

• Ensure children from a prior relationship ultimately benefit.

While a life interest may involve more complexity, it can provide a balance between protecting your partner and safeguarding your children’s inheritance.

How to Decide Which Is Best?

The “right” option depends on your objectives and circumstances:

• Do you want your co-owner to inherit automatically? → Joint tenancy

• Do you want flexibility to leave your share to children or others? → Tenants in common

• Do you want to protect your partner but still provide for children later? → Tenants in common with a life interest

Think carefully about:

• Your relationship status and family dynamics

• Whether children are from a previous relationship

• The potential impact of future relationships

• The risk of care costs and claims against your estate

This isn’t a decision to make lightly or without proper legal advice.

Practical Steps Before Buying Property Together

1. Discuss your intentions with your co-owner(s).

2. Seek legal advice before finalising ownership details on the title.

3. Put a Property Sharing Agreement in place, especially if you’re not in a spousal or de facto relationship.

4. Review your Will and EPAs to ensure they align with your ownership structure.

5. Review regularly — major life events (marriage, separation, children, inheritance) may mean changes are needed.

The Bottom Line 

Property ownership is about more than whose name goes on the title. Choosing between joint tenancy and tenancy in common shapes how the property will be dealt with in the future, especially after the death of an owner.

Joint tenancy offers simplicity and automatic survivorship, and can potential prevent claims made by eligible family members under the Family Protection Act 1955.  It can, however, reduce flexibility in succession planning.

Tenancy in common can provide more control or protection options in some cases, but usually involves probate on death.  Assets owned by you personally on death could be subject to claims, if you don't meet your moral obligation to children (or dependents).

The “best” choice depends on your goals — whether that’s simplicity, protecting a partner, or ensuring children inherit, or don't inherit. The key is to get good advice before you commit, and to have supporting documents like a Will or Property Sharing Agreement in place.

Need Help Deciding What is Right For You? 

Property ownership, estate planning, and trusts all overlap in complex ways. Talking to a lawyer who understands both the property and estate planning angles can save heartache and expense later on.

📌 This blog is general information only and not legal advice. Every situation is different — please get tailored advice before making decisions about property ownership or estate planning.