What Is a TIC Agreement and Why Does It Matter?
You have found an amazing San Francisco home with the space and character you have been looking for—and it happens to be a TIC. As you explore a potential purchase, one of the most important documents to understand is the TIC agreement.
A TIC agreement in San Francisco establishes each owner’s right to occupy a particular home and explains how the building’s co-owners share expenses, manage the property, and make decisions. It also answers practical questions: Which parking space is yours? Is the garden shared or exclusive to your home? How would the owners pay for a new roof?
These are the details that help you understand what owning and living in the home would look like. Our team’s role is to make the details clear, so you feel confident to make an informed decision.
What does a San Francisco TIC agreement cover?
As we explained in What Is a TIC in San Francisco?, a TIC buyer owns a percentage of the entire property. The agreement establishes the right to occupy a particular home and use any additional spaces assigned to it.
It is also the central governing document for the building’s co-owners. It outlines how responsibilities are divided and can address shared expenses, renovations, rentals, sales, financing, and future condominium conversion.
Every building has its own unique structure. Reviewing the agreement helps us understand how those arrangements fit with the home you are purchasing and your plans for it.
Which spaces are yours to use?
Parking, storage, and outdoor space can be a large part of what makes a home appealing. We want those spaces to be clearly identified in the agreement.
If you have fallen in love with a home because of its private garden, for example, we will need to confirm that the garden is assigned for your exclusive use. The same applies to a deck, a storage room, or a particular space in the garage.
Ideally, the agreement includes a detailed property map that corresponds with the written descriptions. Measurements can be helpful as well: a clearly marked parking space with dimensions gives you a better understanding of what is included than a general reference to “one parking space.”
Shared areas should be equally clear. Knowing which spaces are yours and which you share helps everyone understand how to use and enjoy the property.
How are ownership and shared expenses divided?
The agreement should identify both your percentage of ownership and your share of maintenance expenses.
These percentages may match, but they do not have to. A two-unit building might have a 50/50 ownership split, or it might use a different allocation based on the homes and the structure of the agreement. Maintenance expenses may follow that split or have their own formula.
Our team reviews both so you understand what you own and what you are responsible for contributing. We also look at which maintenance items belong to the individual owner and which are shared by the building.
What happens when the building needs a larger repair?
Every building needs maintenance over time. For TIC owners, as for condominium owners, projects such as exterior painting or a new roof are part of caring for the property together.
We review the agreement alongside the building’s financial records and reserves to understand how those projects would be funded. If sufficient money has been set aside, a project may be paid for from reserves. If additional funds are needed, the owners may contribute according to the allocation specified in the agreement.
For example, an owner responsible for 40% of a particular shared expense would generally contribute 40% of the amount that needs to be collected.
Looking at potential upcoming projects and the funds available helps put those responsibilities into context. Our construction experience is particularly valuable here, helping buyers assess potential major repairs, estimate the costs, and understand their share of those expenses before moving forward with an offer.
Can you renovate your home?
Perhaps the home is wonderful, but you would still like to update the kitchen or make other improvements. Our team enjoys advising buyers on renovation projects and their potential to add value. With those goals in mind, we review the alteration provisions in the TIC agreement to understand any applicable approval requirements or limitations.
Some agreements distinguish between smaller interior improvements and more substantial construction projects. Others require homeowners association approval for a broader range of work.
Understanding these provisions early is particularly helpful when a renovation is part of your plans. They explain which projects require consent from the other owners and how that consent is obtained.
What if you want to rent or sell later?
Even if you intend to live in the home for many years, it is important to understand your future options.
An agreement may require an owner to live in the home for a certain period before renting it, establish a minimum lease term, or set other conditions. These terms should be considered alongside applicable local requirements and your plans for the property.
Most modern TICs with individual financing are structured to allow owners to sell independently. Older or differently structured agreements may include additional requirements. Reviewing the terms for the particular building provides clarity about a future sale.
The purpose is to understand your flexibility from the beginning.
What if condominium conversion is being considered?
If future condominium conversion is being considered, the agreement may include provisions related to that process.
Some TIC agreements include commitments intended to support conversion, such as a payment or financial consequence if an owner sells before conversion is completed. If those terms exist, we want buyers to understand what they require and how they could affect a future sale.
Conversion eligibility is a separate question. Language in the agreement about conversion does not, by itself, establish that the building qualifies.
How do the owners work together?
The TIC agreement describes how the building is meant to operate. Available HOA meeting minutes help us understand how it operates in practice.
HOA minutes can provide insight into maintenance planning, upcoming projects, and how the owners make decisions. In a smaller building, they can also help us understand how effectively the homeowners communicate and manage their shared responsibilities.
Together, the agreement, meeting minutes, and financial records give us a more complete picture of the ownership experience.
Does an older agreement need an update?
An older agreement may need clarification or revisions as part of a purchase.
Two areas we often focus on are financing language and the allocation of spaces. An agreement written before individual TIC financing became common may need an update to accommodate the proposed loan. A property map may also need clearer descriptions of parking, storage, or outdoor areas.
Any potential need for revisions is identified during the review before entering escrow. If an update is required for the purchase, its feasibility, approvals, and timing can then be coordinated with the appropriate parties
For more on individual loans and the documents lenders review, read How Does TIC Financing Work in San Francisco?.
What should you understand before purchasing?
For anyone buying a TIC in San Francisco, the agreement review should provide clarity on four core areas:
The home and additional spaces assigned for your exclusive use.
Your percentage of ownership.
Your share of maintenance and other shared expenses.
Any provisions affecting rentals, sales, or future condominium conversion.
Most TIC purchases involve a recent, professionally prepared agreement. Drawing on our extensive experience with San Francisco TICs, our team ensures buyers understand these important details and have their questions answered before entering escrow.
When a new agreement needs to be drafted, we can recommend excellent, experienced TIC attorneys. For additional background, SirkinLaw’s overview of tenancy in common is a helpful resource.
A well-structured agreement provides a clear framework for using and caring for the building alongside your co-owners, helping you move forward with confidence in both the home and its ownership arrangement.
Considering a TIC in San Francisco?
Drew Wilkerson and the Wilkerson Team have helped many buyers and sellers navigate the TIC market in San Francisco. In 2025, Drew ranked as the #1 TIC agent in San Francisco by transaction count.
If the home you love happens to be a TIC, we can help you understand its ownership structure, review the building’s documents, and connect with experienced lending and legal professionals.
Contact The Wilkerson Team to discuss your search or a TIC you are considering.
This article is intended for general informational purposes and is not legal, tax, or lending advice.
