Selling a property held in 50/50 joint ownership

Selling a property held in 50/50 joint ownership (indivision) is a particular challenge faced by many owners, whether former spouses after a divorce, brothers and sisters who have inherited a family property, or associated investors. This complex situation raises key questions: can the sale be forced? How can the price be agreed? What can be done if one of the co-owners refuses to sell?

This detailed guide covers every stage of the sale of property held in joint ownership, from amicable negotiation to court proceedings, including the tax aspects and the pitfalls to avoid.

The basic rules of 50/50 joint ownership

The unanimity rule for acts of disposal

Unlike day-to-day management decisions, which require only a two-thirds majority, selling a property held in 50/50 joint ownership requires the unanimous agreement of all co-owners. This rule derives directly from French civil law, which protects the interests of each joint owner (indivisaire).

Concrete case: Marie and her brother Paul inherit the family home in joint ownership in equal shares. Marie wishes to sell in order to invest elsewhere, but Paul wants to keep the property to live in with his family. Without Paul's agreement, Marie cannot proceed with the sale, even though she holds 50% of the rights.

Acts permitted without unanimity

Certain decisions may be taken by one joint owner alone or by a majority:

• Preservation of the property: urgent repairs, essential maintenance work
• Day-to-day administration: collecting rents, paying charges
• Improvement with the agreement of two thirds (impossible at 50/50, so unanimity is required)

Article 815-2 of the French Civil Code provides that "any joint owner may take the measures necessary for the preservation of the jointly owned property", which includes emergency repairs to prevent deterioration of the common assets. The distinction between preservation measures, acts of administration and acts of disposal is set out in our article on works carried out without the agreement of the other joint owners.

Approaches to obtaining the agreement of a reluctant co-owner

Amicable negotiation: a necessary first step

Before any court proceedings, the reluctant co-owner should be approached for amicable negotiation. This approach has several advantages: speed, lower costs and preservation of family relationships.

Practical example: Sophie and her sister Élise own a Paris flat inherited from their parents. Sophie, who lives outside Paris, wishes to recover her share in order to buy her main residence. Élise, who is sentimentally attached to the property, initially refuses. Sophie then proposes to postpone the sale by six months to allow Élise to find financing and buy out her share, or to accept a price slightly below market value to offset the constraints.

Persuasive arguments

Several arguments may convince a reluctant co-owner:

• Cost of upkeep: charges, works and taxes that accumulate
• Market trends: risk of a fall in property prices
• Alternative investment opportunities offering better returns
• Management constraints: time spent administering the property

Family or property mediation

In the event of deadlock, using a professional mediator may resolve the situation. This neutral third party helps the parties to reach a compromise acceptable to all.

Court-ordered sale (licitation): forcing the sale lawfully

What is licitation?

Licitation is a court procedure for forcing the sale of a jointly owned property where unanimity cannot be obtained. It is the ultimate remedy for a joint owner wishing to exit the joint ownership.

"No one may be compelled to remain in joint ownership"

This fundamental principle of French law guarantees each co-owner the right to request the partition or sale of the common property. The exceptions to this principle and the ways of exiting are set out in our article on the rule that no one is bound to remain in joint ownership.

Conditions for bringing a licitation claim

For a licitation claim to be admissible, several conditions must be met:

• Impossibility of partition in kind (the property cannot be physically divided)
• Failure of amicable negotiations
• No agreement on temporarily maintaining the joint ownership
• Justification of an interest in exiting the joint ownership

Practical case: Julien and his ex-wife Clara hold a house in 50/50 joint ownership following their divorce. Julien, who has remarried, wishes to realise his share in order to buy a new family home. Clara refuses outright, hoping that Julien will give up. Julien may bring proceedings before the judicial court (tribunal judiciaire) to request division and, failing division in kind, the licitation of the property.

Course of the court proceedings

The procedure comprises several stages:

1. Writ of summons served on the reluctant co-owner before the court
2. Court-appointed expert valuation of the property
3. Attempt at conciliation by the judge
4. Judgment ordering a sale by auction or by private treaty
5. Completion of the sale under the supervision of the court

The average duration of a licitation ranges between 18 and 36 months, depending on the complexity of the case and the court backlog. Amicable partition and court-ordered partition are covered separately in our article on rights and obligations in the partition of jointly owned property.

Expert valuation of the jointly owned property

Choosing the valuer: a key issue for the valuation

The valuation of the property is a major point of friction between co-owners. Three options are open to the parties:

• Amicable valuation: the parties choose a valuer together
• Double valuation: each party appoints its own valuer
• Court-ordered valuation: the court appoints an expert registered on the list of the court of appeal

Concrete example: Thomas and his cousin Amélie inherit a residential investment building in joint ownership in equal shares. Thomas values it at €800,000, Amélie at €1,200,000. They decide to instruct two different valuers and then to take the average of the valuations if the difference remains reasonable (less than 15%).

Valuation criteria specific to joint ownership

The valuer must take particular factors into account:

• Joint ownership discount: generally a reduction of 10 to 20%
• State of repair and works required
• Letting situation: current leases, rent levels
• Legal constraints: easements (servitudes), co-ownership (copropriété) regulations

Challenging a valuation

If one of the parties disputes the valuation, it may:

• Request a second opinion valuation
• Apply to the judge for the appointment of a new expert
• Produce comparable evidence (recent sales in the area)

Practical arrangements for the sale

Sale by private treaty vs sale by auction

A sale by private treaty is generally more advantageous than a public auction:

• Sale price generally 10 to 20% higher
• Shorter time frames
• Confidentiality preserved
• Choice of buyer possible

Practical case: Pierre and his sister-in-law Nathalie own a villa on the Côte d'Azur in 50/50 joint ownership. The judge orders the sale but gives them 6 months to find a buyer by private treaty before proceeding to an auction. They manage to sell for €950,000 to a couple of investors, i.e. €150,000 more than the reserve price for the auction.

Allocation of the costs of sale

The costs of sale are allocated in proportion to the shares held:

• Estate agent's commission
• Notary's fees
• Mandatory surveys
• Court-appointed expert's fees, where applicable
• Lawyers' fees

In 50/50 joint ownership, each co-owner therefore bears exactly half of all costs.

Administrative formalities and signatures

The sale of a jointly owned property requires:

• Joint signature of all deeds (preliminary sale agreement, notarial deed)
• A proxy (procuration) where a co-owner is unable to attend
• Settlement of charges and taxes up to the date of sale
• Clearance from the property manager (syndic) where the property is in co-ownership

Tax aspects of a sale in joint ownership

Calculating capital gains on property

Each joint owner calculates their capital gain individually on their share:

• Cost price: acquisition price + costs + deductible works
• Disposal price: share of the net sale price received by the seller
• Allowances according to the holding period

Tax example: Marc and Julie, who are divorced, sell their former main residence, bought for €400,000 eight years ago, for €600,000. Each person's share: €300,000. Individual cost price: €200,000. Gross capital gain per person: €100,000. With the holding period allowance of 6% per year beyond the 5th year (i.e. 18% after 8 years), each person's taxable capital gain amounts to €82,000.

Specific exemptions

Several exemptions may apply:

• Main residence: full exemption if the property has retained this status
• First disposal: subject to income and amount conditions
• Holding period: full exemption after 30 years
• Expropriation: specific exemption regime

Tax planning in joint ownership

To minimise the tax impact:

• Spread the disposals over time where possible
• Take into account the deductible works carried out
• Negotiate the allocation of costs to increase the cost price
• Anticipate the consequences of the sale for income tax

Particular situations and complex cases

Joint ownership after divorce

The sale of a property held in 50/50 joint ownership after a divorce has specific features:

• Often greater urgency (rehousing of the former spouses)
• Relationship tensions that may complicate negotiations
• Compensatory allowance (prestation compensatoire) sometimes linked to the proceeds of sale

Concrete case: Stéphane and Valérie divorce after 15 years of marriage. Their family home, worth €500,000, must be sold so that each of them can be rehoused. Valérie, who has care of the children, initially refuses to sell before finding suitable accommodation. At the request of a joint owner, the court may stay the division for up to two years if carrying it out immediately is likely to impair the value of the jointly owned property, or if one of the joint owners can take over an agricultural holding or a business forming part of the estate only on expiry of that period (Article 820 of the French Civil Code), which provides that "this stay may apply to all the jointly owned property or only to some of it". Valérie's search for accommodation is not one of these grounds: a delay can then result only from an agreement between the former spouses.

Succession with minor heirs

Where minor heirs hold shares in joint ownership:

• Authorisation of the guardianship judge is mandatory for the sale
• Representation by the legal guardian
• Investment of the proceeds of sale according to strict rules

Joint ownership with a usufructuary and a bare owner

This complex situation requires the agreement of both parties:

• The usufructuary receives the income but cannot sell alone
• The bare owner holds the "bare ownership" but without enjoyment
• The sale requires their mutual consent or a specific court procedure

Alternatives to sale: other ways of exiting joint ownership

Buy-out of shares between co-owners

Rather than selling to a third party, one joint owner may buy out the other's share:

• Valuation of the property by both parties
• Financing by the purchaser of the shares
• Greater administrative simplicity
• Retention of the property within the family

Practical example: Antoine and his sister Lucie inherit a flat in joint ownership in equal shares. Antoine, an estate agent, wishes to keep the property to let it. He offers to buy Lucie's share, valued at €180,000, spreading payment over 5 years at an interest rate of 2% per year.

Preferential allocation

In certain successions, preferential allocation (attribution préférentielle) allows an heir to receive a specific property:

• Compensation by an equalisation payment (soulte) to the other heirs
• Retention of the property within the family
• Procedure supervised by the notary

The SCI (French property holding company)

Converting the joint ownership into an SCI offers several advantages:

• More flexible management through a manager
• Easier transfer of shares
• A sometimes more favourable tax treatment
• Changes in the relationship between partners

Practical advice for a sale in joint ownership

Preparation in advance

To optimise the sale of property in joint ownership:

• Document all costs incurred and works carried out
• Regularise the administrative position of the property
• Gather all the necessary documents
• Anticipate the tax issues

Choosing the right professionals

Professional assistance is essential:

• An avocat acting in real estate law for the legal aspects
• A notary to draw up the deeds
• A property valuer for the valuation
• An estate agent for marketing

Communication between joint owners

Maintain a constructive dialogue throughout the process:

• Transparency about each party's motivations
• Regular information on progress
• Compliance with the agreed time frames
• Search for fair solutions

Successful outcome: François and his cousin Isabelle, co-owners of a family house in 50/50 joint ownership, hold a monthly meeting to review the marketing. This regular communication allows them to adapt quickly to visitors' feedback, adjust the price where necessary and complete the sale in just 4 months.

The sale of a property held in 50/50 joint ownership calls for a methodical approach and often the involvement of experienced professionals. The key points are: unanimity is required to sell, licitation is available in the event of deadlock, a reliable valuation agreed by both parties is important, costs are allocated equally, and each co-owner faces individual tax consequences. Given the complexity of these cases and the significant financial stakes, the assistance of an avocat acting in real estate law makes it possible to secure the transaction legally.