How to dispose of your share in an apartment without conflict and profitably

Recommendation points

• Selling a share correctly
• Three times below market
• Check in by court order
• Unauthorized check-in
• Share sale
• Who buys shares

In our country, the practice of joint share ownership of housing is a common and very widespread practice. Since the time of privatization, most of the real estate objects have passed into private ownership precisely by shares.

Today, real estate is also often purchased for fractional ownership. Finally, it is impossible to avoid the emergence of shared ownership in the division of joint real estate between former spouses, it can arise during the donation, inheritance of housing, etc..

As long as the relationship between co-owners is not clouded by conflict, none of them feel anxious about their owning status. But as soon as the co-owners lose mutual understanding, the problem of dividing this specific property inevitably arises. And the solutions to this problem are far from simple.

A typical example: a spouse owns an apartment in equal shares. After the death of the husband, his share (half of the apartment) is divided between the widow and the son of the deceased. Then the wife has three quarters of the house, and the son has a quarter. If the second wants to take his share, the simplest option will be to sell the apartment and divide the proceeds proportional to the shares. However, the widow may oppose such a decision, and this is where an extremely conflict situation arises. The child of the deceased can simply give up on the legal inheritance, but he can also defend his right of ownership. On his part, it will be legal to move into an apartment, transfer his share to trust management or sell it. And in this case, much more unpleasant scenarios are possible for the widow, up to the need to sell her share of the home and leave it at a minimum cost..

Selling a share correctly

If the co-owner of the apartment intends to sell it, according to the law, he must notify the other co-owners and invite them to make a purchase. Usually such notification is made in writing, with an indication of the exact price. In case of a written refusal of the remaining owners or if in the next month the proposed share is not redeemed, the co-owner has the full right to sell his share to any buyer.

Please note: the cost of sale must fully correspond to the price at which the seller offered his share in writing to other co-owners. Otherwise, the co-owners of the apartment may judicially demand the cancellation of the transaction.

Three times below market

Real estate specialists emphasize that fractional ownership of a home is not at all the ownership of a specific room in an apartment. For example, a co-owner may not even have the right to live in this apartment, and, therefore, the price of his shared ownership is not at all equal to the market value of the real estate by area. According to some experts, a square meter of the share of a property is usually cheaper than a square meter in an apartment or house with one owner by about 15-40%. Other experts voice the figure of 20-30% of the cost of ordinary real estate as the price of a share in an apartment. Moreover, practice rather confirms the latest data, if we consider the cost of entire apartments and shares in them on the example of Russian megacities, at least. Shares in small apartments (problem shares) lose the most in price, where the simultaneous residence of all co-owners is physically impossible.

So, let’s recall the situation with the wife and son of the deceased, who have unequal shares in the inherited apartment. The son has the right to sell his quarter of the house for only an eighth of the market value, because no one will buy for a high price. At the same time, the widow can pay the same price for the eighth part of the apartment and, in fact, buy the object twice as expensive, because after that she becomes the sole and full owner of the entire apartment.

Some co-owners of housing, who have completely seized it, are even more radical. After all, without their consent, the remaining shares cannot be realized, which means that it is possible, without redeeming other people’s shares, to dispose of the entire apartment or house with impunity..

When co-owners cannot resolve the issue of dividing their shares without conflict, some of them have to live for years in the siege of other co-owners who are not allowed into the apartment. This tactic is effective, but not if the owner of a smaller share is seriously taken to defend his right to be a co-owner. There are several legal options for him to solve the problem:

• settlement through the court;
• unauthorized check-in;
• selling your share to a third-party buyer;
• sale of your share to a co-owner who occupied the property.

There is also a fifth option – to demand the allocation of your share in the form of a housing plot. But this is rather a theoretical way of solving the issue, because in ordinary city apartments it is almost unrealistic to implement this painlessly for all co-owners..

Check in by court order

Lawyers argue that, ideally, co-owners of housing should voluntarily establish the conditions for using a shared apartment. But a constructive dialogue does not always work out, and here you have to go to court. In this case, the court’s decision is significantly dependent on the presence / absence of each of the co-owners of other real estate, dependents, the financial situation of the parties to the litigation, etc. In a one-room apartment, the right of residence for a large owner of a smaller share will almost certainly be established, if he does not have other housing. and the owner of a larger share will be “asked” from the contested apartment due to the ownership of other residential real estate. It is not uncommon for the court to evict the aggressor from the apartment, and give the green light to the co-owner with the infringed rights. But in situations with multi-room apartments, the court allows all owners to use different rooms, taking into account the size of the shares of ownership and the rooms themselves.

The duration of such a litigation is usually from six months to a year. And even after the completion of the process, peace usually does not come into the relationship of co-owners. After all, justice cannot eliminate a personal conflict, and co-owners can regularly change the locks on the front door. Neither bailiffs nor the police can help in such situations. The only way out is to go to court again.

Unauthorized check-in

Again, theoretically it is possible to resolve the issue without resorting to litigation. When a person is not allowed into his own home, he has every right to enter it on his own and even use force for this (only to break the door, but not to fight or destroy the walls of the home). Article 12 of the Civil Code of the Russian Federation regulates this situation: the behavior of the oppressed co-owner will be interpreted by law as self-defense of rights. Lawyers strongly recommend providing evidence that there have been unsuccessful attempts to resolve the issue peacefully before attempting to break down the door. For example, this will be a copy of a telegram certified by the post office with a request to the offender to provide access to his home and give the keys to him or a preliminary statement to the police against the usurper. Such measures will prevent law enforcement claims against the co-owner who broke into the house. But you need to understand that the personal conflict of the co-owners will only intensify after that.

Share sale

An important point: an apartment with several owners, according to the law, can be in common share ownership or in joint ownership without defining shares, according to Article 224 of the Civil Code of the Russian Federation. And in the second case, none of the co-owners has the right to sell their part, because legally and in fact it simply does not exist. But at the same time, such housing, by agreement of co-owners or in court, can be reissued into shared ownership.

Selling your stake is the easiest option to implement. Of course, it is required to send the co-owners written notices of the sale, to comply with a few more formalities, but in any case it is easier than holding legal proceedings or using physical force in attempts to use your part of the home.

If there is a verbal agreement on the sale of the share with the co-owners, notifications will not be required. Registration of the purchase and sale is carried out as standard. Complicating the situation is the refusal of co-owners to buy their own shares and sell them to third parties. Then the deal is usually delayed by evading sale notices. In any case, it is necessary to send telegrams or registered letters of sale to the owners. In case of persistent silence on the part of the notified co-owners, after which the share will not be sold to them, the court will almost certainly recognize the legality of the transaction.

There is another radical solution to the problem, which does not require contact with co-owners. The fact is that the consent of the latter is not required when donating a share of housing. If a gift disguises a sale, the transaction can be challenged in court, but it is almost impossible to prove the sale.

Another way to bypass co-owners is a pledge. The owner of the share draws up in accordance with Art. 807 of the Civil Code of the Russian Federation with a third-party buyer, a loan agreement for an amount equal to the planned cost of the sold share. This share is the collateral for the loan. The pledge is registered with Rosreestr, the owner receives money from the lender, and then the parties draw up a compensation agreement: the veiled buyer forgives the debt, and in return receives the subject of pledge – in fact, a share in the apartment. The disadvantage of such a scheme is possible problems when registering a pledge in Rosreestr, therefore, it is optimal in such cases to resort to the services of professional realtors or lawyers. There are real estate agencies in large Russian cities that work with such objects.

Who buys shares

Realtors usually divide home buyers into the following categories.

The first acquire a share for their own living in the apartment, hoping to negotiate with the rest of the co-owners. Needless to say, this option is very risky.?

Others buy a share of real estate in order to get permanent registration. Here, the share can be ridiculously small – even a hundredth, because the consent of the co-owners is not required for registration at the place of residence. You just need to present at the passport office documents confirming the ownership of the share. But it will not work to register third parties without the consent of the co-owners, experts note. An exception is made only for minor children who are assigned to their parents.

Raiders who buy shares in an apartment in order to impose their own conditions on the owners are usually persuaded to sell their share. The latter type of buyers is a big problem for share owners who have kicked out other co-owners from their homes. A professional raider is able to provide unbearable living conditions for his neighbors. For example, the owner of the fourth part of the apartment deliberately flooded the lower floors at night, the residents of which have sued all the owners of the apartment. It turns out that it is more profitable for the owner of the rest of the apartment to sell his share to the raider than to pay compensation to the neighbors.

So, the readers of this article now know: even the most aggressive co-owner of an apartment can be dealt with in an absolutely legal way. However, it is also obvious that the best course of action is not to escalate the conflict, but to try to come to an agreement with co-owners, buy out the remaining shares or sell housing together. The result will be more profit and less time and nerves wasted..