Understanding Co-Ownership Structures (and what’s right for you)

Rising home prices and tighter lending standards have made traditional solo ownership feel out of reach for many buyers. But teaming up with friends, family, or partners opens new doors — literally.
Still, “owning together” isn’t one-size-fits-all. There are several ways people can share ownership, each with its own legal, tax, and financing implications.

Below, we’ll break down each type — what it means, the pros and cons, and how Joynt sees it fitting into modern co-ownership.

The Main Ownership Structures

Limited Liability Company (LLC)

An LLC creates a legal entity that holds title to the property. Each co-owner becomes a member, owning a defined percentage of the company rather than the property directly.
It is currently the most common and flexible structure for modern co-ownership.

Key facts

• Protects members’ personal assets from property-related liability.
• Allows detailed rules for decisions, costs, and exits through an operating agreement.
• Offers pass-through taxation (income flows to members, avoiding corporate tax).
• Lenders often require personal guarantees or individual borrowing, so financing can be more complex.

Sources: Limited liability company (LLC) | Internal Revenue Service ; The Best Holding Company Structure For Real Estate Investors (Full Breakdown)

Tenancy in Common (TIC)

Each owner holds a separate share of the property in their own name—such as 50/50 or 60/40—and all share equal rights to occupy the entire property.

Key facts

• No liability protection: each owner is personally responsible for debts or lawsuits.
• Ownership shares can be unequal and transferable independently.
• One co-owner can petition a court to force a sale (“partition action”).
• Common for casual or legacy co-ownership, but higher risk without a written agreement.

Sources: Tenancy in Common Explained: Differences, Benefits, and Comparisons

Joint Tenancy with Right of Survivorship

Two or more people own equal shares. If one owner dies, their share automatically transfers to the survivor(s), avoiding probate.

Key facts

• Only equal ownership shares are allowed.
• Common for couples who want automatic inheritance.
• No liability protection; all owners remain personally responsible.
• Not ideal for three or more unrelated co-owners.

Source: Differences Between Joint Tenants With Survivorship and Tenants in Common - FindLaw

Tenancy by the Entirety

Available only to legally married couples in certain states, this form combines joint tenancy with additional creditor protection.

Key facts

• Prevents most creditors of one spouse from seizing the property.
• Requires both spouses to sign for sale or refinancing.
• Provides automatic inheritance upon death.

Joynt’s Perspective:
❌ Joynt views this as a solid, automatic option for married couples not separate co-owners, and it doesn’t add much beyond what an LLC or trust can provide when couples plan for shared or future ownership with others (e.g., family members or heirs).

Sources: What Is Tenancy by the Entirety? Requirements and Rights

Trusts (Revocable or Irrevocable)

A trust is a separate entity that holds title to the property for named beneficiaries. It is widely used for estate planning but not typically for everyday shared management.

Key facts

• Revocable living trust: avoids probate and allows easy changes.
• Irrevocable trust: offers stronger asset protection but less flexibility.
• Trustees—not beneficiaries—control decisions.
• Does not insulate beneficiaries from property liability in the way an LLC does. While an LLC provides a corporate veil (shielding personal assets from the property's liabilities), a Trust's primary role is estate planning and asset holding. The key distinction is that an LLC's structure (the corporate veil) is what provides the liability protection, not the trust structure itself.

Joynt’s Perspective:
✅ (+ LLC) Joynt recommends trusts for multi-generational or estate-based ownership when paired with an LLC. The LLC manages the day-to-day; the trust ensures smooth transfer of ownership over time.

Sources: Trust vs. LLC: What’s the Difference?

Partnership (General or Limited)

Partnerships predate LLCs and are still used in investment settings. In a general partnership, all partners share profits and liabilities. A limited partnership separates managing and passive partners.

Key facts

• Pass-through taxation similar to LLCs.
• General partners remain personally liable.
• Limited partners have reduced liability but less control.
• Requires formal partnership agreements and tax filings.

Source: Partnerships | Internal Revenue Service

Corporation (C-Corp or S-Corp)

A corporation is a formal legal entity separate from its owners (shareholders). It can hold real estate but is rarely used for personal or small-group ownership.

Key facts

• Provides strong liability protection.
• C-Corps face double taxation; S-Corps avoid this but have ownership restrictions.
• Requires bylaws, board meetings, and corporate filings.
• Overly complex for shared residential property.

Joynt’s Perspective:
❌ Joynt doesn’t recommend corporate structures for home ownership. They’re too complex and tax-heavy for small co-ownership groups, offering no advantage over LLCs for residential use.

Sources: Tax and Liability Benefits of Holding Companies - Murray | Lobb Attorneys - Houston, Texas

Cooperative and Community Land Trust Models

Cooperative (Co-op)

Residents own shares in a corporation that owns the building rather than owning their individual units. Common in New York, Washington D.C., and other large cities.

Key facts

• Each shareholder receives a proprietary lease to occupy a unit.
• Transfers require board approval.
• Ideal for multi-unit housing, not single-family homes.
  
  

Community Land Trust (CLT)

A nonprofit owns the land, and residents own or lease the improvements. Designed to preserve affordability and community control.

Key facts

• Used primarily for affordable housing initiatives.
• Keeps property prices stable over time.
• Ownership rights are limited by the trust’s rules.
  
  

Joynt’s Perspective:
⚠️ Joynt supports co-ops and CLTs as part of the broader housing ecosystem—especially for community-based or affordability programs—but these models are not designed for small private groups sharing one property.

Sources: What Is a Community Land Trust?

How to Choose What’s Right for You

What Joynt Recommends

After working with a wide range of co-ownership groups, Joynt consistently recommends using an LLC as the foundation for most shared-ownership arrangements.

For Friends or Family Buying a Primary Home

• Buy in your own names first to qualify for standard residential financing.
• Form an LLC immediately after closing—only with explicit, written lender consent to transfer the title to the LLC, as transferring without it violates the 'Due on Sale' clause of most mortgages.
• Adopt a formal operating agreement to define payments, scheduling, decision-making, and exit procedures.

This sequence preserves loan flexibility while adding protection and clarity once you move in.
Learn more

For Shared Vacation or Second Homes

• Form the LLC before purchase if the property will also be rented.
• Buy first and form later if it’s primarily for personal use.
• Maintain liability coverage and proper insurance (DP-3 for rentals, HO-3 for personal use).

Learn more

For Protected Co-ownership with Family Legacy In Mind

• Combine an LLC with a revocable trust.
  The LLC governs daily management; the trust handles inheritance and long-term control.
• This structure keeps decision-making organized while ensuring smooth succession.

For Investment or Group Purchases

• Use an LLC or limited partnership.
• Define capital contributions, voting thresholds, and buyout terms in the operating agreement.
• Keep accounting and cash flow through the entity’s bank account for compliance and transparency.

The Bottom Line

Each ownership type has its purpose, but the LLC remains the most balanced approach for modern co-ownership. It protects each member’s personal assets, defines rights and responsibilities, and allows for flexible financing when structured properly.

Joynt’s platform guides co-owners through the legal, financial, and practical steps of forming and managing these structures—so that ownership stays organized, transparent, and sustainable over time.

Learn more about when to add an LLC