One home, two owners: What you should know before buying together

For many, buying a home is a milestone that often requires years of planning and financial commitment. One way to make the purchase more affordable is through joint ownership, which allows two or more people to share both the costs and responsibilities of owning a property.While combining incomes can improve home-loan eligibility and reduce the financial burden, co-ownership also brings legal and financial obligations that should be clearly understood before signing the sale deed.Share of propertyThe sale deed should clearly specify each co-owner's share in the property. This may be an equal 50:50 split or another ratio, such as 60:40, depending on the parties' financial contributions and mutual agreement.The ownership ratio can influence several aspects of the property, including the distribution of rental income, liability for capital gains tax and the amount each person receives if the property is sold.If the sale deed does not specify the ownership ratio, the property is automatically considered to be equally shared among the co-owners.Tax implicationsJoint ownership can enable eligible co-owners to claim tax deductions separately, subject to the applicable rules and conditions.Under Section 22 of the Income-tax Act, 2025, eligible taxpayers may claim a deduction for interest paid on borrowed capital used to acquire or construct a qualifying self-occupied house property. The deduction is subject to a maximum of Rs two lakh, subject to the conditions prescribed under the Act.However, the actual tax benefit depends on factors such as the ownership share, the structure of the home loan, each co-owner's repayment contribution and the tax regime chosen.Stamp dutySeveral Indian states, including Uttar Pradesh and Delhi, offer stamp duty concessions for women when a property is registered either solely or jointly in their name.As the benefit differs from one state to another, buyers should check the applicable local rules before completing the registration.Property transfer and successionBefore entering into a joint ownership arrangement, co-owners should discuss how situations such as the sale of a share, non-payment of EMIs or an exit from the arrangement will be handled.According to Section 44 of the Transfer of Property Act, 1882, a co-owner can transfer only their own share in the property and cannot transfer the entire property without the rights and consent of the other co-owners.If a co-owner dies, their share in the property passes to their legal heirs.Joint homeownership can provide significant financial advantages, but only when the arrangement is properly documented. Before signing the sale deed, buyers should verify the property's title and documents, clearly define ownership shares, ensure the sale deed aligns with the loan documents, record each person's financial contribution and plan in advance for exit and succession.Ready to Make a Smarter Property Decision? Build Your Legacy with TOI Homes.