Free Real Estate Partnership Agreement Template

A real estate partnership agreement sets out the terms between two or more people who buy, hold, or develop property together.

Property partnerships differ from ordinary trading partnerships in one important way: the asset is large, illiquid, and usually mortgaged. You cannot divide a building the way you can divide a cash balance, and that shapes every term in the document.

The agreement covers how the property is bought, how it is run, how money flows, and — most importantly — what happens when one partner wants out while the others do not.

Partners are frequently friends or family, and the arrangement often starts informally. Writing it down early is what keeps a good relationship intact when the property market, or somebody’s circumstances, changes.

Property partnerships fail on the financial terms more than on anything else, and these need settling before completion.

• Capital contributions: who puts in what, and when.
• Unequal contributions: whether a larger contribution earns a larger share, a preferred return, or repayment first.
• Sweat equity: what a partner managing renovation or lettings receives for their time, and whether it is paid or credited.
• Ongoing costs: how mortgage payments, insurance, maintenance, and voids are funded.
• Capital calls: what happens when the property needs money nobody planned for.
• Distributions: how rental income is split, and how often.
• Sale and refinancing proceeds: how these are divided, which may differ from the income split.

Capital calls deserve particular attention. A roof replacement or a long void can require thousands at short notice, and an agreement that is silent on what happens when one partner cannot pay leaves the others with no good options.

The lending arrangements often matter more than the partnership terms themselves.

Personal guarantees sit outside the partnership. Where partners guarantee a mortgage personally, a lender can generally pursue whichever guarantor it chooses, regardless of how the partners have agreed to share liability between themselves. The agreement decides who reimburses whom, not who gets pursued.

Decide how title is held and record it. Whether the property is held in individual names, jointly, or through an entity affects a great deal, and it should match what the agreement says rather than contradicting it.

Anticipate refinancing. Whether partners can require a refinance, who must consent, and how released equity is treated are questions that arise sooner than people expect.

Check what the lender permits. Transfers of interest, additional borrowing, and changes in ownership may all require the lender’s consent, and a partnership term that ignores that can put the loan in breach.

Tip: Take advice on structure before you buy, not after. How the property is owned affects liability, financing, and tax, and changing it later can be expensive or impossible.

Everything else in a property partnership can be renegotiated. The exit terms usually cannot, which is why they deserve the most thought.

Agree a valuation method now. Independent valuation, an agreed formula, or an average of two valuations all work; deciding the method while everyone is friendly is the whole trick.

Include a buy-sell mechanism. A right of first refusal for the remaining partners, with a defined timetable and payment terms, prevents a forced sale of the property every time somebody wants out.

Set a minimum holding period if that suits the plan. A partner who can demand a sale in year one undermines a five-year strategy.

Deal with death, divorce, and bankruptcy expressly. Each can put a partner’s interest into someone else’s hands, and the remaining partners usually want an option to buy rather than a new co-owner they did not choose.

Tip: Talk through the scenario where one partner needs their money back urgently and the others cannot afford to buy them out. Whatever you decide should happen, write that down — it is the situation these agreements exist for.

A real estate partnership agreement should be specific about both the property and the people.

The Partners and the Property

Full names, the property address and title reference, and how title is held.

Purpose and Term

Buy-to-let, development, or resale, and how long the partnership is intended to run.

Capital Contributions and Ownership Shares

What each partner contributed and what percentage they hold.

Financing

The mortgage, any guarantees, and who is responsible for what.

Income, Expenses, and Distributions

How money in and out is handled, and how often profits are distributed.

Capital Calls

How additional funds are raised and what happens if a partner cannot contribute.

Management and Decisions

Who deals with tenants, repairs, and agents, and which decisions require unanimous agreement.

Transfer, Exit, and Valuation

Buy-sell terms, rights of first refusal, and how an interest is valued.

Dispute Resolution, Dissolution, and Governing Law

How disagreements are settled and how the partnership ends.

A real estate partnership agreement should be drafted before you commit to a purchase. Document Genius walks you through each section with simple questions.

1. Take Advice on Structure First

From a lawyer and an accountant, before you buy.

2. Record Contributions and Shares

Including anything unequal.

3. Set Out Money In and Money Out

Costs, capital calls, and distributions.

4. Define Who Manages What

And which decisions need everyone.

5. Draft the Exit Provisions Carefully

Valuation, buy-sell, death, divorce, and bankruptcy.

6. Have It Reviewed, Then All Partners Sign

Each taking their own advice. Start yours now and have a draft ready for review.

Property partnerships involve enough money to justify proper input, and partners rarely regret getting it.

One lawyer cannot act for everyone. Each partner should have someone looking at the agreement on their behalf, particularly where contributions or roles are unequal.

Understand the liability you are accepting. Depending on the structure and where you are, partners can be personally responsible for the partnership’s obligations, including those incurred by another partner.

Get tax advice before buying. How a property partnership is taxed, how income and gains are treated, and what happens when an interest changes hands vary considerably and are difficult to fix afterwards.

Involve a conveyancer or property lawyer on title. How ownership is registered should reflect what the partners have agreed.

Nothing on this page is legal, tax, or financial advice, and no rule on partnership liability, property ownership, mortgage lending, landlord obligations, or taxation is stated anywhere on it. Take advice from a lawyer and an accountant in the jurisdiction where the property sits.