Cohabitation agreements are even more crucial following a decision by the Government ditch the Law Commission's proposals to give further rights to unmarried couples.
All couples buying property together who are not married should sign up to one, according to a leading Midlands matrimonial solicitor.
Nigel Mears, partner and head of the family law team at Black Country law firm George Green, said the decision not to provide legal protection for unmarried couples when their relationship ends means they have to make their own legal agreements to avoid disputes over the splitting of property assets.
"With no prospect of a change in the law, co-habitation agreements are vital to avoid later disputes over property, as living together does not confer on a couple the same rights as marriage," he cautioned.
"It is estimated that some two million people live together outside of marriage or a civil partnership. But more than half of them wrongly believing that cohabiting couples have rights as common law spouses. In fact the concept of a common law marriage is often misunderstood – it has only been found to exist on a couple of occasions since 1945, where the exceptional circumstances have been met to justify a couple not having followed the usual formalities for getting married.
"As a result of the Government's unwillingness to change the law, we will see many more co-habitation disputes. Although fewer people are getting married, many will still buy property together and live together.
"If a non-married couple split up, no account is taken by the courts of how long they have been together, when it comes to assigning the assets. Indeed, if there are no children involved, the matter is dealt with by a completely different division of the law – the Civil rather than the Family Division."
According to Mr Mears, in divorce cases, after catering for the needs of the children, judges can use their discretion to take into account the length of relationship and what each party has brought to the marriage in determining how to divide the assets.
The conduct of the parties is also often cited as a contributory factor in determining how to do this in a matrimonial breakdown. However, when co-habitees split, the process is completely different.
"For co-habitees, property disputes are resolved under the Trusts Of Land And Appointment Of Trustees Act 1996, which looks solely at the legal aspects of the ownership of the property," said Mr Mears. "How the property is divided, depends on whether the couple own it as 'joint tenants' or 'tenants in common'.
"A joint tenancy has to be owned in equal shares, resulting in an equal split of the assets, no matter who contributed what share of the cost, or who inherited the property.
"Tenancy in common allows the property to be owned in unequal shares to reflect each partner's contribution. If they split, then the property is divided along the lines of the shares set out in the declaration of trust relating to the interests in the property.
"Failure to choose the correct method of ownership when a couple buy a property can lead to some apparently inequitable divisions of assets when they split up, compared to their original inputs.
"If one partner contributes a substantially greater proportion of the purchase cost, they can feel cheated by the outcome. In many cases women can be left much worse off under the TOLATA regulations than they would have been, had they been getting divorced.
"While the different forms of property ownership should be explained by conveyancers to couples when they buy a house, drawing up a co-habitation agreement makes them think much more deeply about all the issues involved in living together, including the care of children. It is a vital exercise for couples buying property together to save time, money and heartache should they split.
"Even couples getting married should consider a pre-nuptial agreement for the same reasons.
"Again, the drawing up of the agreement gives each partner the chance to think through a number of different scenarios and agree on the outcomes if they part."