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Summary: A co-ownership agreement is a private contract between people buying a home together who are not married. It records each owner's share, who pays what, and how someone exits. In Ontario, co-owners hold title as tenants in common by default under the Conveyancing and Law of Property Act.
More people are buying property with someone other than a spouse: a partner they are not married to, a sibling, a close friend, or a parent helping an adult child onto the property ladder. Pooling two incomes and two down payments can make a purchase possible that neither person could manage alone.
It also ties two financial lives to a single asset. A co-ownership agreement is how you decide, in advance and in writing, what happens while you own the home together and what happens when one of you wants to leave.
What is a co-ownership agreement?
A co-ownership agreement is a written contract among two or more people who own a property together. It sets out each person's ownership share, their financial responsibilities, and the rules for selling, refinancing, or buying each other out. It works alongside how you hold title, not instead of it.
Married spouses already have statutory protections for the family home. Unmarried co-owners have very few default protections, so the agreement fills that gap. Think of it as two separate questions: title decides who owns the property in the eyes of the law, and the agreement decides how the owners deal with each other, their money, and their exit.
Without an agreement, the law still applies, but on generic terms that may not match what either person intended. A clear contract replaces "we assumed" with "we agreed."
How do co-owners hold title in Ontario?
In Ontario, two or more people hold title either as joint tenants or as tenants in common. Under section 13(1) of the Conveyancing and Law of Property Act, they are presumed to be tenants in common unless the transfer expressly creates a joint tenancy.
The practical difference is what happens when an owner dies. Joint tenants have a right of survivorship, so a deceased owner's share passes automatically to the surviving owner, outside the estate. Tenants in common each own a distinct share that passes through their own will.
Joint tenancy | Tenancy in common | |
Ownership shares | Equal and undivided | Can be unequal (for example, 70/30) |
When an owner dies | Passes automatically to the surviving owner | Passes through that owner's estate under their will |
Leave your share to someone else | Not possible | Possible |
Common use | Married or committed couples | Friends, siblings, family, and unequal contributors |
Friends, siblings, and partners who contribute different amounts usually hold title as tenants in common, so their shares reflect what they put in and each person controls where their share goes. Your lawyer sets this on the transfer, and your co-ownership agreement should record the same shares so the two documents agree.
What should a co-ownership agreement cover?
A good agreement answers the money and exit questions before they become disputes. It records what each person owns, what each person pays, and the exact process for one owner leaving. At a minimum, it should address the following.
Ownership shares. The percentage each person owns, usually tied to their down payment and mortgage contribution.
Costs and contributions. Who pays the deposit, mortgage, property tax, insurance, utilities, condo fees, and repairs, and in what proportion.
Occupancy. Who lives in the home, and whether an owner who does not live there is owed rent or a credit.
Major decisions. How you agree on refinancing, renting the property out, or funding a large repair.
Exit and buyout. How a departing owner's share is valued, who has the first right to buy it, and the timeline to close.
Death or default. What happens if an owner dies, stops paying, or becomes insolvent.
Dispute resolution. A step such as mediation to try before anyone goes to court.
What does it cost to add or remove a co-owner from title?
Changing who is on title is a transfer of an interest in land, so it can trigger land transfer tax (LTT). In Ontario, LTT is calculated on the value of the consideration, and when a property is mortgaged, the value of consideration includes the share of the mortgage principal and accrued interest that the incoming owner takes on.
Take a home with a $600,000 mortgage. Adding a co-owner as a 50% owner means they assume $300,000 of that mortgage, so LTT applies to $300,000 of consideration, roughly $2,975 in provincial LTT. In Toronto, the Municipal Land Transfer Tax (MLTT) applies on top and roughly doubles the bill. Transfers between married spouses can be exempt where the only consideration is the assumed mortgage, but that exemption does not extend to friends, siblings, and other non-spousal co-owners.
Beyond tax, expect legal fees to prepare and register the transfer, and remember that a lender's consent is required before anyone is added to or removed from title on a mortgaged property.
What happens if one co-owner wants out?
When one owner wants to leave, the usual routes are to sell the whole property, or have the remaining owner buy the departing owner's share. A clear agreement makes this orderly; without one, the exit is negotiated from scratch under pressure. Here is the typical path for a buyout.
Check the agreement. Any buyout price, right of first refusal, or notice period in your contract governs the process.
Value the home. An appraisal establishes market value, then you subtract the mortgage and selling costs to find each share's net equity.
Arrange financing. The remaining owner usually refinances to raise the departing owner's share and to remove them from the existing mortgage.
Transfer title. A lawyer prepares the transfer, pays any land transfer tax owing, and registers the change.
If you cannot agree. Under the Partition Act, any co-owner has a prima facie right to apply to court to force a sale, and courts grant these applications unless the person seeking the sale is acting oppressively or vexatiously.
For a closer look at how owners divide what the home is worth, see our guide on methods for splitting equity in real estate.
Frequently asked questions
Do you need a lawyer to buy a home with someone in Ontario?
You need a lawyer to close any purchase, and it is worth involving one early when you are buying with a co-owner. A lawyer sets how you hold title and can prepare or review your co-ownership agreement so the two documents line up.
Is a co-ownership agreement legally binding?
Yes. A co-ownership agreement is a contract, and a properly drafted, signed agreement is enforceable in Ontario. Clear terms on shares, contributions, and buyouts are far easier to enforce than a verbal understanding, which is why the agreement should be in writing.
What happens to the property if a co-owner dies?
It depends on how you hold title. If you are joint tenants, the deceased owner's share passes automatically to the surviving owner. If you are tenants in common, their share passes through their will to their estate, which may bring a new co-owner into the picture.
Can one owner force the other to sell?
Often, yes. Under the Partition Act, a co-owner has a prima facie right to apply to court to force a sale of jointly owned property, and courts usually grant it unless the person asking is acting oppressively or vexatiously. A buyout clause in your agreement can provide a calmer alternative.
Do unmarried partners have the same rights as married spouses?
No. Ontario's family law protections for the family home apply to married spouses, not to common-law partners or other co-owners. That is exactly why unmarried co-owners rely on a co-ownership agreement to set out their rights.
How is land transfer tax calculated when adding a partner to title?
Land transfer tax is based on the value of the consideration, which includes the share of the mortgage the person takes on. Adding a 50% owner to a home with a $600,000 mortgage means tax applies to about $300,000, with Toronto adding its municipal tax on top.
About the author
Joel Fox is a co-founder and COO at Ownright. He helps run the firm's day-to-day work on Ontario residential closings, refinances, and sales, and writes regularly to demystify the parts of a transaction that most homeowners only encounter once or twice in their lives.
At Ownright, we focus entirely on Ontario residential real estate law. We help people buying a home together handle title, closings, refinances, and the paperwork that ties it all together, through a digital platform backed by licensed Ontario lawyers you can reach by chat, email, or video call. You can start your closing online or get in touch with any questions.
Legal references: Conveyancing and Law of Property Act, R.S.O. 1990, c. C.34, s. 13(1); Partition Act, R.S.O. 1990, c. P.4; Land Transfer Tax Act, R.S.O. 1990, c. L.6; Family Law Act, R.S.O. 1990, c. F.3.
Important note: This article is not legal advice. No one should act, or refrain from acting, based solely on the information in this post or any linked materials without first seeking appropriate legal or professional advice.
