Hi,
My grandmother owns 25% of a property, with her brother owning the remaining 75%. Her brother is claiming that he can make legal moves to forcibly purchase her 25% share of the property if she doesn't sell it to him.
Neither party wants the property sold.
Is this correct?
Yes, as a majority owner of the property he can force a sale of the property. Not that he can force her to sell her % to him, he can force the sale through a real estate agent and he would get his 75% from the sale, and she would get 25% from the sale. She could fight it, but who knows what it would cost in legal fees. It's obviously worth it to him, since he gets 3/4 of the sale. If it was a 50:50 split, that would be an entirely different situation.
However you should talk to a solicitor asap, and get specific legal advice.
Ok. He wants to forcibly buy her share, but not sell the property in the market.
That is not possible, you cannot force anyone to sell property if the owner doesnt want to sell it. We live in a free country for a reason.
Thanks so much for your help.
He can't forcible buy it. Your grandmother should play hardball and tell him to put the house on the open market if he's not prepared to pay more than the market value of the property (25%)
that sounds like a win win for both parties concerned.
Completely agree with this comment. If she is considering selling the house then get an independant valuation and see if he can meet the price she wants to put on it. Sounds like he is trying to bully her into this. Make sure you back her up.
@try2bhelpful: neither party wants the property sold as it's in an area likely to appreciate. There's a bit more to it.
100%
https://www.vcat.vic.gov.au/get-started/co-owned-land-and-go…
VCAT might be able to help you, or guide you to whomever you need to talk to.
It sounds like there's more background to this story and the ownership of this house is just being used to piss off your grandma.
Correct
It would probably help if you said what State the property was in. I don't agree with garetz answer that the issue is determined on % of ownership. Maybe in one State, but certainly not the case in all.
Vic
OK, not being in Vic, I had to look it up. Section 225 of the Property Law Act states that a part owner may apply to VCAT for an order for the sale of the property and the proceeds to be disbursed accordingly.
So, I agree that:
It's just incorrect to say that the % of ownership is relevant.
In these cases, you will end up with more money if you can agree on a value for the % as you won't pay sales commission. On the other hand, if the offer is low, you wouldn't be any worse off than to test the market with an understanding that the 75% owner would have first right of refusal to match the price in which case don't sign the contract. This puts the sales agent out - but my concern would be for the 75% owner trying to sabotage the sale and letting the agent know what the plan was - in which case why would the agent bother to do any work to try to sell.
% ownership is highly relevant in WA.
No idea about the rules in Vic - so you are absolutely right that the OP's location is relevant.
Thanks for the thorough info.
@blaircam: WA might as well be a different country with its legal differences.
Reminds me of the Thai saying, Same same but different :D
If ownership is 75/25, it must be as tenants in common. A tenant in common is free to do what they like with their share of the property (eg. sell his 75% share of the property), but cannot dictate or force the owner/s of the other shares to do anything.
What happens if the place were to go to market.
Mr 75% has loan sharks knocking the door with baseball bats and wants to sell for $500k
Ms 25% has done the research and understands similar properties are fetching $600k, and wants to hold out for a similar price?
I'd say if Ms is wanting 25% of $600k market price = $150k.
If Mr is wanting to sell for $500k then he'd have to settle for $350k as his share (500k - 150k), cos otherwise he'll be getting $0 if Ms doesn't want to sell it at all.
My grandmother owns 25% of a property, with her brother owning the remaining 75%.
Did your grandfather leave your grandmother 25% and your brother 75% of the property in his will? What happened to your share of the property?
"grandmother" "her brother"
not OP's brother
not OP's brother
ohh. thank for that.
So if the brother forced the sale of the property he would get 75% and grandma would get 25%.
I’m assuming this would also mean the brother pays 75% of the selling costs?
So be careful and research the properties development potential. Last thing you want is to find out your grandmother got hardballed and it turns out to be a $10million unit development site which she got forced to sell her share for peanuts to him.
what does her lawyer say?