This attorney drafted real property co-ownership agreement provides the terms of an
agreement between two parties who co-own real property. The document sets forth the
respective ownership interest of each party, as well as the respective ongoing rights and
obligations of each party with respect to the property. As drafted, the agreement
requires the parties to resolve any disputes first through mediation and then arbitration.
This document is fully customizable to ensure the agreement between the parties is
Real Property Co-Ownership Agreement
This agreement is executed this _____day of _____, ______ [Instruction: Insert agreement
date.] by and between: _____ [Instruction: Insert first partyâ€™s name.] (â€œFirst Partyâ€) and
______ [Instruction: Insert second partyâ€™s name.] (â€œSecond Partyâ€). First Party and Second
Party have purchased a property known as _____ [Instruction: Insert legal property address.],
herein referred to as the Property. The parties hereto acknowledge that they own the Property as
______ [Instruction: Insert how property is titled.] and that First Party has _____
[Instruction: Insert First Partyâ€™s respective ownership percentage.] percentage beneficial
ownership interest and Second Party has ______ [Instruction: Insert Second Partyâ€™s respective
ownership percentage.] percentage beneficial ownership interest in the Property.
For good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, and in consideration of the mutual covenants and conditions herein contained, the
parties hereto agree as follows:
1. The Property was purchased on _____ [Instruction: Insert Property purchase date.] for
a price of $_____ [Instruction: Insert Property purchase price.]. The parties have
each made an equal capital investment [Comment: If each party made different capital
investments, please list here.] towards the purchase of the Property and are jointly liable
on an outstanding mortgage with an initial principal balance of ______ [Instruction:
Insert mortgage initial principal balance.] including any additional principal, interest
and/or other charges assessable thereto.
2. The parties hereto deem it in their best interests to define their obligations to each other
with respect to the ownership, maintenance and sale of the Property, and to provide for a
mechanism to allow for the sale of either partyâ€™s interest.
3. It is the intention of the parties is that First Party and Second Party shall jointly occupy
the Property. [Comment: If this language does not properly reflect the partiesâ€™
agreement, revise as applicable. In the event the parties own a multi-unit property,
and each will occupy a separate portion thereof, special consideration will need to
be given in the event each such separate portion is of a varied size.] [Comment:
Parties may wish to provide a mechanism for loss of use of the Property in the event
a party does not pay his respective carrying charges, assessments or other amounts
owed pursuant to the agreement.]
4. The parties hereto agree they shall bear the costs of the Property in proportion to their
ownership interests in the Property. For purposes of this agreement, â€œcarrying costsâ€
shall be deemed to include but not limited to common charges, if any, mortgage
payments of both principle and interest, real estate tax payments, private mortgage
insurance (if applicable), sewer and water use payments, fire and extended insurance
coverage, municipal betterments, electricity and other utilities including heat , and
repairs, maintenance and capital improvements. The parties further agree that ____
[Instruction: Insert name of responsible party.] shall be responsible for ensuring all
payments for any such carrying costs are paid as and when same shall become due and
5. All documents pertaining to the ownership of the Property shall be maintained by ______
[Instruction: Insert name of party responsible for ownership documents.].
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6. The Property shall be kept and generally maintained in first class condition, habitable,
clean, reasonably freshly painted and attractive and in generally good condition. A
landscaper will be hired on a minimum of bi-monthly basis to maintain the landscape and
the cost of same shall be borne in proportion to their ownership interests in the Property.
All mechanical portions of the Property shall be kept in good working order and free
from leaks or other structural failures. Any repair or capital improvement or item of
maintenance to the Property costing more than $100.00 shall require the approval of all
parties but such approval shall not be unreasonably withheld and shall be given to
conform to the standards of the paragraph, and the costs and expenses of such repair or
capital improvement or item of maintenance shall be divided among the parties as set
forth in this agreement. Notwithstanding the foregoing, in the event any such repair or
capital improvement or item of maintenance to the Property shall be required by any
governmental authority or other authority with jurisdiction (including, as applicable, any
cooperative or condominium board, if any) over the Property shall not require any such
approval of either party.
7. The parties agree that they shall not rent the Property. In the event the parties shall agree
in the future to rent the Property, any such rental shall be made to tenants who shall be
approved by both parties or by their duly appointed agent or management company at an
agreed upon fair market value. Any collected rents shall be used to directly reduce the
carrying costs of the Property. Any positive cash flow shall be distributed to the parties
in proportion to their ownership interest, unless otherwise agreed in a writing signed by
both parties. In the event of any such rental, each party shall be responsible to file any
necessary forms and pay any taxes applicable to any such income collected based upon
their percentage interest, unless otherwise agreed in a writing signed by both parties or as
otherwise required by applicable law.
8. The parties agree to open and maintain a house account to be used to pay the Property
carrying costs as stated in this agreement. The house account shall be funded by the
parties based upon their percentage ownership interest in the Property. Contributions to
the house account shall be made monthly, in amounts to be determined by the parties.
Both parties shall have a signature authority for checks on the house account.
9. The property may not be sold on or before _____ [Instruction: Insert date before which
Property may not be sold. In the alternative, this provision may be deleted.].
Thereafter, in the event that either party should wish to sell his or her interest in the
Property, he shall first offer to sell his or her interest to the other party(s) hereto by a
written notice stating the proposed terms of sale. The other party(s) shall within thirty
(30) days of the notice of offer to sell elect either (I) to accept the offer and purchase the
offering partyâ€™s interest on the terms offered, or (II) consent to the proposed sale to a
third party upon terms offered, or (III) agree to list the Property for sale on the market.
Any closing between parties arising from a sale or transfer under this paragraph shall
occur within a reasonable time agreed upon by all parties. In the event that only an
interest in the Property is sold, the willing seller shall be responsible for all seller fees and
shall be solely responsible for his payment of any liens or encumbrances arising out of
his or her separate obligations and shall deliver good, clear, record and marketable title
except for joint encumbrances and matters known to the parties on the date of acquisition
of the Property. In the event a withdrawing co-owner is behind in the payment of any
monthly contributions for carrying costs or special assessments, these arrearages shall be
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deducted from the amounts paid above. In the event that the Property is sold by all
parties, the costs incurred by selling (i.e. payment of mortgage, brokerâ€™s commission,
escrow, title, etc.) will be deducted from the purchase price, and the net amount will then
be divided between the parties upon their percentage interest, unless otherwise agreed in
a writing signed by both parties. In the event any co-owner is behind in the payment of
any monthly contributions for carrying costs or special assessments, these arrearages
shall be deducted from the amounts paid above.
10. Either party shall be permitted to transfer his ownership interest hereunder by will or
intestacy without restriction, except that any such transferee shall be bound by the terms
of this agreement, as well as the applicable rules of the condominium or cooperative
board, if any. The costs associated with any such transfer shall be payable by the
11. For any disputes arising under this agreement, parties agree to first resolve the dispute
under mediation and then arbitration in the county of _____ [Instruction: Insert
arbitration county.]. In the event of any dispute hereunder, the party prevailing in such
mediation or arbitration shall be entitled to recover, in addition to any and all other
remedies and damages, and reasonable attorneysâ€™ fees incurred in such action.
12. Any notices sent or required to be sent pursuant to this Agreement shall be in writing and
be deemed to be duly served if mailed, postage prepaid, certified mail, return receipt
requested, or delivered by Federal Express or other comparable overnight carrier, or
delivered in hand by a duly appointed constable, to the addresses of the parties stated
below or to such other addresses as either party may notify the other by notice given
pursuant to this paragraph: ______ [Instruction: Insert First Party and Second Partyâ€™s
13. This agreement shall be construed, interpreted and enforced in accordance with the laws
of the State of _____ [Instruction: Insert state.].
14. This agreement constitutes the entire agreement of the parties with respect to its subject
matter, and may not be changed orally, but only by an agreement in writing signed by the
party against whom the enforcement of any waiver, change, modification, extension or
discharge is sought.
15. The waiver by one party of a breach of any provision of this Agreement by the other
party shall not operate or be construed as a waiver of any previous or subsequent breach
of the same or any other provision by the other party.
16. In the event that any portion of this agreement shall be deemed null and void or
unenforceable by any court of competent jurisdiction, then notwithstanding the same, the
remaining provisions of this agreement shall be full force and effect.
17. This agreement or any subsequent amendment or modification hereto may be executed by
facsimile and/or in one or more counterparts, each of which when so executed and
delivered shall be deemed an original, but all of which taken together shall constitute but
one and the same original. Each party shall accept any such signed faxed counterpart as
full execution of this agreement or any subsequent amendment or modification thereto.
18. The pronouns used herein shall include, where appropriate, either gender or both,
singular and plural.
IN WITNESS WHEREOF, the undersigned have executed this agreement under seals of the
date and year first written above.
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First Party Signature Block
Second Party Signature Block
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