Do I need to pay rent as a part-owner - Part 2
Question from Peter Moore updated on 4th October 2006:
I want to comment on the answer to Lin's question that was recently answered on this website. He asked: "I am a part owner in a house with my siblings left to us as an inheritance. Two of my siblings live in the house, I live overseas. One of my siblings thinks I should be paying my share of the mortgage (which is about $500 a month), rates, insurance. I think that whoever stays in the house should pay it, as this is considered "rent" If we got renters in, then the income would cover the mortgage, rates and insurance. When I am back in NZ I do stay in the house, but I am only back every 2 or so years, a month or 2 months at a time. Looking forward to your reply." No doubt it is true (as stated in the answer) that this is not a residential tenancy, but that appears to beg the question. My understanding of land law is that if one co-owner pays off the mortgage, and another does not, then the paying co-owner has thereby established an additional equitable interest in the property that s/he can claim when it is sold. Against that, the use of the property could arguably create an equitable liability, though this may not inevitably be the case. Advice from a lawyer specialising in land law should be sought so Lin does not get any nasty surprises when his property is eventually sold.
Our expert Jeff Montgomery responded:
Yes I agree that Lin should seek specialist legal advice.
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