Risks of Tenancy in Common

In addition to all the risks of investment real estate, owning real estate in common entails the risk of disagreement or conflict with the other tenants as to the management, financing or sale of the property. Unanimity among the tenants is required for all major decisions, and though there are usually provisions allowing the purchase the interest of a dissenting tenant, this could prove difficult or time consuming. If the property held in common is leveraged, there is the risk of being unable to re-finance the program at the end of the term of said loan. Also, there is the risk of possible conflicts of interest with program sponsors, trustees, or property managers.