Buying a Home with a Friend or Partner in Ireland: Legal Complexities and Benefits Explained
Introduction
The Irish property market remains tight. According to the Central Statistics Office, the median price of a dwelling in the 12 months to June 2025 was €370,000, a 7.8 % increase on the previous year, and first‑time buyers accounted for 1,531 purchases in that month alone. For many aspiring owners, pooling incomes with a friend, sibling, or long‑term partner is the most realistic route onto the ladder.
However, buying together is not as simple as signing a single mortgage form. Irish law distinguishes between joint tenants and tenants in common, and the absence of a clear co‑ownership agreement can leave parties exposed to costly disputes if the relationship ends, if one party defaults on the mortgage, or if one wishes to sell.
This article breaks down the legal landscape, highlights the practical advantages of joint ownership, and provides a step‑by‑step checklist for anyone considering buying a property with a friend or partner in Ireland.
1. Why Co‑ownership Can Be an Advantage
| Benefit | How It Helps First‑time Buyers |
|---|---|
| Higher borrowing power | Two incomes can satisfy lenders’ affordability tests, allowing a larger deposit and a better‑priced property. |
| Shared deposit & fees | Conveyancing, stamp duty (currently 1 % on the first €1 m) and legal costs are split, reducing each person’s cash outlay. |
| Risk diversification | If one party loses a job, the other’s income can keep repayments on track, reducing the chance of repossession. |
| Access to better locations | Joint buying often makes it possible to purchase in Dublin suburbs or high‑demand counties where solo buyers would be priced out. |
| Potential tax efficiencies | Proper structuring can optimise mortgage interest relief and capital gains tax (CGT) exposure when the property is sold. |
The CSO data shows a 13 % rise in the number of dwelling purchases year‑on‑year (4,029 filings in June 2025). Much of that growth is driven by co‑ownership arrangements, especially among younger adults who are not yet married.
2. Core Legal Concepts: Joint Tenants vs Tenants in Common
| Feature | Joint Tenants (JT) | Tenants in Common (TIC) |
|---|---|---|
| Ownership share | Undivided equal share – each owns the whole property. | Defined share (e.g., 60 %/40 %). |
| Right of survivorship | On death, the surviving co‑owner automatically inherits the deceased’s share, irrespective of a will. | Shares pass according to the deceased’s will or intestacy rules. |
| Mortgage liability | All co‑owners are jointly and severally liable for the whole loan. | Same joint‑and‑several liability, but each can claim a contribution proportionate to their share. |
| Divorce or breakup | No automatic right to force a sale; parties may apply to the court for partition. | Similar, but the court can order a sale based on unequal shares. |
| Typical use | Married couples, civil partners. | Unmarried friends, siblings, business partners, or any party that wants a clear share split. |
Key takeaway: If you are not married or in a civil partnership, most solicitors recommend a Tenancy in Common arrangement because it preserves each party’s intended share and allows you to control who inherits your interest.
3. The Importance of a Co‑ownership Agreement
A co‑ownership agreement (sometimes called a “joint ownership deed”) is a private contract that sits alongside the title deed. It can address:
- Initial contributions – cash deposit, legal fees, and any “gifted” share.
- Ongoing expenses – mortgage payments, rates, insurance, repairs, and utilities.
- Decision‑making – who can sell, refinance, or let the property.
- Exit strategy – formula for valuing shares (e.g., independent valuation, agreed multiplier) if one party wants to exit.
- Dispute resolution – mediation, arbitration, or court as a last resort.
- Inheritance provisions – explicit instructions for wills and potential life‑insurance beneficiaries.
Without such an agreement, the default legal position applies, which can lead to “occupational rent” claims or costly court‑ordered accounting adjustments under the Land and Conveyancing Law Reform Act 2009 (S.31). The Act allows courts to order a fair contribution for disproportionate outgoings, but the process is time‑consuming and expensive.
4. Wills, Probate and the Right of Survivorship
Even if you choose a Tenancy in Common, you must still consider inheritance:
- Joint Tenants: The surviving co‑owner inherits automatically, bypassing the will. If this is not your intention, you may need a “survivorship deed” to convert the tenancy to TIC.
- Tenants in Common: Your share passes according to your will. If you die intestate, the share goes to your next of kin, which may be someone you do not wish to own the home with.
Practical tip:
- Draft a will as soon as the purchase completes.
- Consider a life‑insurance policy equal to the outstanding mortgage balance, naming the co‑owner(s) as beneficiaries to avoid the estate being forced to sell the house.
5. Mortgage Liability and Credit Implications
Irish lenders treat co‑owners as jointly and severally liable. This means:
- If one co‑owner defaults, the lender can pursue the other(s) for the full outstanding amount.
- Credit scores are affected by the mortgage’s payment history for all parties.
- A “split mortgage” (where each party is responsible for a specific share) is rarely offered in Ireland, so joint liability is the norm.
Mitigation strategies
| Strategy | How It Helps |
|---|---|
| Separate savings accounts for mortgage contributions | Provides a clear paper trail if a dispute arises. |
| Mortgage protection insurance for each party | Covers repayments if a co‑owner becomes unable to pay due to illness or unemployment. |
| Financial covenant clause in the co‑ownership agreement | Requires a minimum income threshold to remain a co‑owner, with an exit mechanism if breached. |
6. Tax Considerations
| Tax | Relevance to Co‑ownership |
|---|---|
| Stamp Duty | Payable on the total purchase price; each co‑owner can claim a proportion of the cost in their tax return. |
| Rental Income (if the property is let) | Income must be split according to ownership share; each party files their own Schedule C (or Form 12) with the Revenue. |
| Capital Gains Tax (CGT) | On a future sale, each co‑owner is liable for CGT on the gain attributable to their share. Proper record‑keeping of initial contributions can reduce the taxable base. |
| Mortgage Interest Relief (currently limited) | Available only for rental properties; the relief is split proportionally. |
| Inheritance Tax (CAT) | If a TIC share passes by will, it may be subject to CAT at 33 % after the €335,000 threshold (2025). A joint tenancy bypasses CAT because of survivorship. |
7. Common Pitfalls and How to Avoid Them
| Pitfall | Consequence | Preventive Action |
|---|---|---|
| No written co‑ownership agreement | Reliance on default legal rules; possible “occupational rent” claims. | Draft and sign a comprehensive agreement before exchange of contracts. |
| Unequal contribution without documentation | Disputes over who owns what; unfair CGT allocation. | Record each party’s cash input, and reflect it in the deed’s schedule of shares. |
| One party assumes sole responsibility for repairs | No right to recover costs; may lead to resentment. | Include a clause on repair cost sharing and a method for reimbursement. |
| Failure to update wills after purchase | Shares may pass to unintended heirs. | Review and amend wills within 30 days of completion. |
| Ignoring mortgage protection | Risk of repossession if one party loses income. | Obtain separate mortgage protection policies for each co‑owner. |
| Assuming “joint tenancy” automatically applies | May inherit unwanted shares. | Choose tenancy type deliberately; seek solicitor advice. |
8. Step‑by‑Step Checklist for Buying Together
- Discuss Goals – Agree on intended ownership type, future sale plans, and each party’s financial commitment.
- Engage a Solicitor Early – Choose a solicitor experienced in co‑ownership agreements and conveyancing.
- Secure Mortgage Pre‑approval – Obtain joint‑and‑several pre‑approval; request a breakdown of each party’s affordability.
- Draft the Co‑ownership Agreement – Include contributions, expense sharing, exit formula, dispute resolution, and inheritance wishes.
- Sign the Agreement & Register the Title – Ensure the deed reflects the chosen tenancy (JT or TIC) and the agreed shares.
- Arrange Insurance – Buildings insurance in both names; consider life‑insurance to cover mortgage balance.
- Update Wills & Beneficiary Designations – Within a month of completion, have each party’s will reflect the property share.
- Set Up Joint Accounting – Separate bank account for mortgage and outgoings; keep receipts for tax purposes.
- Monitor Mortgage Payments – Both parties should receive statements and confirm payments are made on time.
- Plan for the Future – Review the agreement every 3‑5 years or after major life events (marriage, children, job change).
9. Real‑World Example
Emma (28) and her brother Liam (30) each contributed €30,000 toward a €250,000 Dublin suburb house. They opted for a Tenancy in Common (60 % Emma, 40 % Liam) and signed a co‑ownership agreement covering mortgage splits, repair contributions, and a right of first refusal if one wishes to sell. Six months later, Emma secured a promotion and wanted to buy a second property. The agreement allowed her to sell her share to a third party, with Liam given a 30‑day right of first refusal. The sale proceeded smoothly, and both parties avoided a costly court battle.
The case illustrates how a well‑drafted agreement protects both parties, even when life circumstances change.
10. When to Seek Professional Help
- Complex ownership structures (e.g., more than two co‑owners, mixed residential/commercial use).
- Existing relationships (e.g., unmarried couples with children) where family law may intersect.
- Cross‑border investors (EU or non‑EU) needing advice on tax residency and CGT.
- Disputes already brewing – early mediation can prevent escalation to the courts.
A solicitor, a tax adviser, and a mortgage broker should work together to ensure the arrangement is legally sound, tax‑efficient, and financially sustainable.
Conclusion
Buying a property with a friend or partner can unlock the door to homeownership in a market where solo buyers face steep price barriers. The financial advantages—shared deposits, higher borrowing power, and risk diversification—are compelling. Yet the legal complexities—choice of tenancy, co‑ownership agreements, inheritance planning, and joint mortgage liability—must be tackled head‑on.
By understanding the distinction between joint tenants and tenants in common, drafting a thorough co‑ownership agreement, and securing appropriate wills and insurance, co‑owners can protect their interests and enjoy the benefits of shared ownership without the fear of unexpected disputes.
If you’re considering this route, start the conversation early, involve qualified professionals, and use the checklist above as your roadmap. With the right legal framework in place, you and your co‑owner can confidently step onto the Irish property ladder together.