Joint Tenancy vs Tenancy-in-Common and How to Change

Whether you are about to become a property owner or you already own property in Singapore, you may want to know about holding your property in the manner of either a joint tenancy or tenancy-in-common.

Immovable property (houses being the most common example) in Singapore can be held in either manner. You’ll have to make your decision on the manner of holding at the point of purchase or transfer of ownership, which will then be reflected in a registry maintained by the Singapore Land Authority (SLA).

This article will cover:

• What is joint tenancy
• What is tenancy-in-common
• Joint tenancy vs tenancy-in-common: pros and cons and which you should choose
• Whether your manner of holding the property affects who pays the mortgage loan (if any)
• Whether joint tenants/tenants-in-common can evict the other from the property
• How to check the manner of holding of your property
• How to change the manner of holding in your property in Singapore
• What can you do if you want to change the manner of holding, but the other co-owners refuse

What is Joint Tenancy? 

In joint tenancy, co-owners individually own the whole interest in the property. This means that if you and your partner own a property in the manner of joint tenancy, then you and your partner will each own 100% of the property. There are no separate shares.

What is Tenancy-in-Common? 

In contrast to a joint tenancy, tenants-in-common own the same property in definite and separate shares. Your manner of holding does not have to be 50-50, and tenants-in-common can have unequal shares. For instance, as a property owner, you can choose to own 75% of the property, while your co-owner owns the remaining 25%.

Joint Tenancy vs Tenancy-in-Common: Pros and Cons and which You Should Choose

Right of survivorship 

When holding property in joint tenancy, the right of survivorship applies. This means that if one co-owner dies, the surviving tenant automatically takes sole ownership of the whole property. This is regardless of whether the deceased joint owner has left behind a will stating who the property should go to after their death, and whether or not they wish for the surviving joint tenant to inherit the property in the first place.

On the other hand, the right of survivorship does not apply when holding property as tenants-in-common. This is because each tenant holds the property in separate and distinct shares. Should one of the property owners die, the surviving tenant will be entitled to only his or her percentage share in the property (which they already have).

The portion owned by the deceased tenant will go to his or her estate and be distributed according to the will or (if the deceased tenant had not written a will) the Intestate Succession Act (ISA). If the deceased tenant was a Muslim, distribution of the estate will be governed by the Administration of Muslim Law Act (AMLA).

Ease of decoupling 

If you already own a residential property with your spouse and both of you intend to purchase a second one, holding the first property as tenants-in-common makes it possible for you to avoid paying or pay reduced Additional Buyer’s Stamp Duty (ABSD) on the second property. This is done by decoupling and part-purchase of the ownership of the first property.

Decoupling is the act of removing one spouse from the ownership of the first property, and then transferring that spouse’s share to the other spouse (who will then be the sole owner). On the other hand, part-purchase is where one spouse buys over all the shares owned by the other spouse in the first property.

After the decoupling or part-purchase has occurred, the spouse who no longer has ownership of the first property can then buy the second property solely under their name, and this will be regarded as their first property. The couple can therefore save on ABSD as Singapore Citizens do not have to pay ABSD for their first property while for Singapore Permanent Residents, the ABSD is reduced to 5% on their first property.

However, for decoupling and part-purchase to occur, the property has to be held as tenants-in-common. By doing so, each spouse will hold distinct and separate shares in the property, which can be transferred or sold from one spouse to the other such that the property becomes solely owned by only one spouse.

Tenants-in-common who hold their property using a 99-1 split also can benefit from reduced stamp duties. This is because when the 1% share is being transferred to the purchasing party during the decoupling process, that party will pay stamp duties on only that 1% share (as opposed to a higher percentage share like 50% if the parties had chosen to hold in equal shares).

Purpose of buying the property

A joint tenancy may be more beneficial for spouses buying a matrimonial home to live in for the rest of their lives. This is because on the death of one of the co-owners, the rule of survivorship will kick in and the property will automatically be vested in the surviving co-owner. The rule will also apply even if the deceased has not drafted a will to vest the property in the surviving co-owner.

However, a drawback of the rule of survivorship is also that spouses cannot transfer their share of their property to non-owners (e.g. their children). On the other hand, with a tenancy-in-common, the deceased’s co-owner’s shares in residential property can be distributed via a valid will, the ISA, or the AMLA (if the deceased is Muslim). The person receiving such inherited property would generally also not need to pay stamp duty.

If your purpose of buying properties is for investment purposes (e.g. selling your share for profits or renting out your property), it may be more advisable to hold your property as tenants-in-common such that each owner will hold a specified share in the property. This allows each owner to have liquidity in the holdings, which means each owner can sell off his or her share in the property without involving the other co-owner(s).

Does Your Manner of Holding the Property Affect Who Pays the Mortgage Loan (If Any)?

The manner of holding has little implication for mortgage loans as loan repayment is a joint and several liability for the mortgagors/borrowers.

The manner of holding also does not affect who pays the mortgage loans. This is because the loan agreement is a private agreement between the lender and borrower, and also between the different co-owners, as to who pays and how much to pay. Therefore, the manner of holding has little relation as to who is responsible for the mortgage loans.

Can Joint Tenants or Tenants-in-Common Evict the Other From the Property?

As a co-owner, whether by a joint tenancy or tenancy-in-common, you cannot normally evict the other co-owner(s) as they have a right to remain in the property.

If the co-owner is abusive, however, then it may be possible to evict him or her from the entire shared residence or a specified part of the shared residence. Under section 65 of the Women’s Charter, if the court views it as necessary for the safety of the one being abused, the court may grant that person the right of exclusive occupation over the whole or part of the shared property. This means that that person will have the right to keep the abusive person out of the property, even if he or she is a joint tenant or tenant-in-common.

To gain the right of exclusive occupation, however,  the person being abused must first file an application for a Personal Protection Order (PPO)/Domestic Exclusion Order (DEO). A PPO and DEO are court orders applicants can apply for to protect themselves from family violence. Generally, a PPO restrains the abuser from committing family violence against the applicant, while a DEO can ban the abuser from the property in which the family has been living in (either the whole property or only certain parts of it).

Separately, as a co-owner of the property, whether by a joint tenancy or tenancy-in-common, you generally have the right to evict non-owners from the property. However, this is subject to their equitable interest in the property (for married couples) or their right to occupy and use the premises. In addition, you may not evict your child under the age of 21 as you are legally required to maintain him or her.

You can read more in our other article about evicting occupants from a property in Singapore.

How to Check the Manner of Holding of Your Property

If you own an HDB flat, you can check your manner of holding by logging in to My HDBPage.

For private properties, you can obtain information about your manner of holding in the property by paying a fee of $5.25 for “Property Ownership Information” on INLIS.

How to Change the Manner of Holding of Your Property in Singapore

For both public (HDB) and private properties, you should note that:

• Tenants-in-common must hold the property in 50-50 shares before being able to convert their manner of holding to a joint tenancy. If you and your co-owner own the property in unequal shares, then the co-owner holding more shares will need to transfer their shares to the other co-owner to achieve a 50-50 split.
• You may incur seller’s stamp duties if you need to transfer shares to one party to make your shares equal.
• When receiving shares from the other co-owner, the co-owner receiving the shares will also need to pay buyer’s stamp duties.

In addition, if the property is under a bank mortgage, you may need to get the consent of the mortgagee bank before you can convert the manner of holding in the property.

If your property is an HDB flat

For HDB flats, you can change the manner of holding of your flat from joint tenancy to tenancy-in-common in equal shares and vice versa. After making a declaration of your flat’s market value in HDB’s Application Form (mentioned in the next paragraph), you can also convert your manner of holding from tenancy-in-common in unequal shares to joint tenancy and vice versa, or change the proportion of the shares in the tenancy-in-common.

The Application Form for changing the manner of holding or proportion of shares in the property is available at any HDB Branch, and you can also download it from the HDB website. A non-refundable administrative fee of $50.00 is payable when submitting the form. You can either appoint a conveyancing lawyer to act for you in this transaction or engage HDB’s own lawyers for this purpose.

If your property is a private property

For private property (this includes condominium units), the conversion of the manner of holding is done by lodging and registering the relevant Instrument of Declaration with the Singapore Land Authority.

The existing co-owners (whether joint tenants or tenants-in-common) will have to sign an Instrument of Declaration (statutory declaration) before a Commissioner for Oaths stating their intention to hold the property as tenants-in-common or joint tenants. If all tenants agree on the conversion, they will all sign the same form to be lodged.

A change in the manner of holding might require you to transfer part of your interest in the property to the other tenant(s), and this transfer will be subject to stamp duties as well. You may wish to appoint a conveyancing lawyer to assist you in handling the paperwork transactions and ensure that the right amount of stamp duties are paid.

What Can You Do If You Want to Change the Manner of Holding, but the Other Co-Owners Refuse?

If one joint tenant wishes to change the manner of holding to a tenancy-in-common but the other joint tenant(s) do not want to do so, the willing joint tenant must sign the Instrument of Declaration stating his or her intention to change the manner of holding to being tenants-in-common. The same applies for tenants-in-common intending to change the manner of holding to a joint tenancy, although they will have to hold the property in equal shares first.

The Instrument of Declaration will then have to be duly served on the other unwilling joint tenant(s) by a solicitor. As the procedure and steps to be taken thereafter can be complex, it is advisable to consult a conveyancing lawyer.

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Choosing the right manner of holding in your property is important because this may affect any future housing plans (or changes in these), such as decoupling. It can also be a hassle to change the manner of holding later on. You should therefore think carefully about which manner of holding is most appropriate for your situation, especially if you are planning to buy a new property.

To sum up, joint tenancy involves the rule of survivorship, which means it may be more appropriate for co-owners looking to buy a matrimonial home for the rest of their lives as the property will automatically vest in the surviving co-owner. Alternatively, if you intend to decouple your property or use it for investment purposes, then holding the property in a tenancy-in-common may be more beneficial for you. However, be aware that there may be applicable stamp duties for any transfer of shares in the property.

You may wish to consult a conveyancing lawyer if you need legal advice on holding property as a joint tenancy or tenancy-in-common in Singapore, or on converting your manner of holding in your property. A conveyancing lawyer would also be able to assist you with the necessary documents, procedures and payment of stamp duties involved in changing your manner of holding.