How do TICs differ from Condos?
With a condo, property is divided into physical parts that are individually mapped and recorded in public records. Each owner has a deed that defines exactly which part of the shared property they own— “Unit 2A, southeast corner” for example.
Tenants in common, however, own percentages in an individual property. Their rights to a certain area of the building (“Unit 2A, southeast corner”) are spelled out by a contract, as are their rights and obligations. This contract is not recorded in county real estate records.
If you buy into a TIC property, can you sell it in the future?
Historically, the resale market for TICs has been very good.
A holder of a TIC can sell his or her interest at any time – and while the past is no guarantee of the future, TIC property values have usually held up very well. And not surprisingly, values tend to be higher where the owners have a track record of maintaining the property.
Usually, TIC agreements specify that other tenants in common have the right of first refusal and the right to approve the new owner. In practice, TIC owners usually experience very few problems when they decide to sell.
Can a TIC co-owner claim the mortgage tax deduction?
Yes. The mortgage interest that you pay on your fraction of your loan is tax deductible. So are property taxes. Be sure to consult your tax advisor for details.