Buying Property with a Friend or Family Member? Why a Co-Ownership Agreement Is Essential
With California real estate prices remaining sky-high, more people are getting creative to make ownership work—splitting a cabin in Tahoe with siblings, buying a duplex with a partner, or going in on a rental property with a friend.
Pooling resources is a smart way to get into the market, but it comes with one big caveat: real estate is easy to buy together and hard to untangle later. That’s where a co-ownership agreement comes in—and it might be the most important document you don’t have yet.
At Apricity Law, we’ve helped clients structure and manage successful co-ownership relationships—and resolve some messy ones, too. Here's what you should know before you co-sign that mortgage.
Why You Need a Co-Ownership Agreement
Even if you're buying property with someone you trust completely, a sibling, best friend, or long-time partner, you still need to protect both sides with clear expectations.
Without a written agreement:
The law assumes you're 50/50 owners, no matter who paid what.
Anyone can force a sale through a partition action, even if you're not ready.
Disputes over repairs, occupancy, or income can escalate into litigation.
A co-ownership agreement gives everyone clarity. It defines how decisions are made, how money flows, and what happens if one party wants out.
What Should a Co-Ownership Agreement Cover?
There’s no one-size-fits-all contract. Your agreement should reflect your shared goals and the type of property you’re buying. But here are the essentials we typically include:
Ownership Percentages & Contributions
Who owns how much?
Who contributed to the down payment, and how will future contributions (like repairs or mortgage principal) affect ownership?
Will one party be reimbursed upon sale if they put in more up front?
Ongoing Expenses
Who is responsible for monthly costs—mortgage, taxes, insurance, maintenance?
Will you split everything equally, or based on ownership percentage?
What happens if someone can’t (or doesn’t) pay their share?
Occupancy & Use
Can either party live in the home? Do they pay rent to the other?
Will the property be used as a primary residence, a rental, or a mix?
Are short-term rentals like Airbnb allowed?
Sale or Exit Strategy
What happens if one owner wants to sell their share?
Do the others have a right of first refusal to buy them out?
How will the value be determined? Appraisal, agreement, or average of multiple estimates?
Dispute Resolution
If you disagree on a major issue, how will it be resolved—mediation, arbitration, or court?
Can a co-owner force a sale, or is there a lock-in period?
What happens if one party passes away or becomes incapacitated?
Already Own Property Together? It's Not Too Late
If you've already bought property with someone, you can still create a co-ownership agreement. In fact, it's often more important if you're starting to see differences in expectations.
We've drafted post-purchase agreements that retroactively define ownership shares, reimburse prior contributions, and create rules for future decisions. These documents can prevent friction before it turns into legal action.
Plan While You Still Get Along
It’s easy to agree on everything when you’re excited about buying a property together. That’s the perfect time to write down the deal.
A well-drafted co-ownership agreement:
Protects each owner’s investment
Reduces misunderstandings
Creates a roadmap for unexpected changes
And perhaps most importantly, it preserves relationships—which is worth far more than the cost of drafting the agreement.
Let Apricity Law Help
At Apricity Law, we work with friends, families, and investment partners to create clear, customized co-ownership agreements that protect your interests. We offer flat-fee packages and can often prepare everything in just a few days. Whether you’re buying a property together or already own one, we can help you put the right legal framework in place.
Thinking about co-owning property? Let’s make sure everyone’s protected.
Schedule your consultation →
Disclaimer: The information provided in this blog is for general informational purposes only and does not constitute legal advice. Reading this article does not create an attorney-client relationship between you and Apricity Law, PC. Legal issues are complex and fact-specific; you should not act or rely on any information contained herein without first consulting a qualified attorney regarding your specific situation. While we strive to keep this content current, laws and regulations may change, and we do not guarantee the accuracy, completeness, or timeliness of the information provided. If you require legal assistance, please contact Apricity Law, PC to discuss your matter.