When (and Why) You Need a 'Party Wall Agreement' With Your Neighbors
When you buy something, you expect to have complete ownership over that object. If you buy a book at a bookstore, you can read it, tear the pages out and make paper airplanes with it, or use it to balance a wobbly table—and no one can stop you. If you buy a house with some property around it you expect to be able to do what you like with the walls of your home (within legal boundaries, of course)—but if your home is attached to someone else’s house (a condo or rowhouse situation), things can get a little complicated because some of the walls you just bought might be party walls.
A “party wall” isn’t a festive barrier designed for fun, but rather a wall that’s owned by two parties—you and your neighbor. As with any property owned by more than one person, things can get weird fast if you have a disagreement about how to use that property. That’s why you should consider negotiating a Party Wall Agreement (PWA) with your neighbor.
What's a Party Wall Agreement?
A Party Wall Agreement is pretty much what it sounds like: It defines how your shared wall can be used and the shared responsibilities of the mutual owners. Why do you need one? A PWA can cover a wide range of potential scenarios between you and your neighbor:
Access to the other side of the wall (known as an easement) for necessary repairs and maintenance to the wall or other areas of your property that can only be accessed via the wall
Allowed use of the wall (in case your neighbor wants to use your bedroom wall as a handball court)
Defining required maintenance each owner must perform
Defining what happens if one owner damages the party wall in some way
How renovations that might remove, move, or otherwise transform the shared wall will be handled or negotiated
Defining what happens if one owner fails to observe the agreement—for example, a PWA can limit monetary damages, or require arbitration instead of litigation
Once you think about it, the need for a formal agreement becomes obvious. And working one out before there are any conflicts or disagreements is a very good idea. Another benefit to having a formal agreement covering the party wall is that these agreements are filed with your local county clerk or other land-use office, so potential buyers can be reassured that there will be no nasty surprises if they buy your home (generally, these agreements remain in effect with future owners until both parties adjust or dissolve the agreement).
If you live in a home governed by a homeowners association (HOA) or other entity, it’s likely that Party Wall Agreements are baked into the HOA rules, so it’s worth investigating before deciding to try and work out your own.
Creating the agreement
If you have a shared wall, it’s a pretty simple process to create a PWA:
Discuss. Talk to your neighbor and work out the broad outlines of what the agreement should say. You can’t unilaterally impose a Party Wall Agreement, so you’re going to need your neighbor’s participation.
Create the agreement. It’s best to engage a real estate attorney with knowledge of your local laws to create the agreement, but you can find free agreements you can modify and download online. If you use a downloaded form, however, it’s still a good idea to have a lawyer review it.
File it. Once you and your neighbor have agreed on the terms and signed the agreement, it needs to be filed with the proper office. This will vary from municipality to municipality, but most often this will be done at the county clerk’s office, where it will be associated with the deed for the two properties.