More than 3.5 million couples in England and Wales now live together without being married or in a civil partnership—more than twice the number 30 years ago. However, the law has not kept pace.
Property is often the most valuable asset a couple owns. Decisions about its sale, ownership and occupation can therefore have a major effect on both parties, their children, and the agents managing the transaction.
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Clarity will help agents and consumers
Estate agents may be instructed by both owners, by one owner with the other's agreement, or by one party acting under a court order. Clarity about who has the legal authority to instruct a sale is vital.
Transactions can be delayed when one owner accepts an offer but the other refuses, when documents are not signed, or when the person occupying the property does not cooperate with viewings. Uncertainty about when the occupier will move can also delay or jeopardise a sale.
The amount available from a settlement can determine whether the parties can buy or rent, pass affordability checks, and secure a property suitable for their children.
Why reform is being considered
The legal framework governing financial arrangements following divorce has remained largely unchanged for more than 50 years. A Law Commission review carried out in 2024 found that the current system can produce uncertain outcomes, increase costs, and prolong conflict.
Although legislation allows the courts to divide property and other assets following divorce, much of the way concepts such as sharing, need, and compensation are applied has developed through case law. The UK Government believes putting these principles into legislation would make the system clearer and more accessible.
There is no dedicated statutory framework for dividing finances when a co-habiting couple separate. Instead, property disputes usually rely on complex trust and property law.
‘Common law marriage’ has no legal status. Couples do not automatically gain the same rights as married couples simply because they have lived together for a long time or have children.
Fairness requires more than an equal split
A settlement should recognise financial and non-financial contributions, any disadvantages created by the relationship, and the future housing needs of both parties. For example, one person may have contributed more towards the purchase or improvement of a property, while another may have given up employment to care for children. Both circumstances should be considered.
Financial misconduct should also be treated seriously. Undisclosed borrowing, fraud, excessive spending, or unpaid joint bills can damage a person’s credit record and affect their ability to rent or obtain a mortgage long after the relationship has ended.
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Clearer rules for divorce
The UK Government proposes placing existing legal principles into law and clarifying uncertain areas. Courts would aim for a fair outcome based on sharing and need. Assets gained through the marriage would usually be shared equally, unless a different split was needed to support either person or their children.
Courts could also consider how an asset was used. For example, a separate investment property may be treated differently from a home shared and improved by both people.
New protections for cohabiting couples
Each person would usually keep the property they legally own. However, courts could change property ownership to meet specific needs. Claims would usually need to be made within two years of separation.
The rules would apply to adults in a lasting family relationship who have lived together for at least three years, who share a child, or have a child living as part of their family. There would be no minimum period for couples with a child.
Inheritance rights could be extended
The UK Government is also considering giving qualifying cohabitants the same rights as spouses and civil partners when someone dies without leaving a valid will. This could allow a surviving cohabitant to inherit automatically.
