Property Ownership Information

Tenants in Common

Where two or more people own property in defined shares. Upon the death of one owner, ownership of that person's share passes according to their will, not automatically to the surviving owners. A tenancy in common is usual where the property is a farm, or the co-owners wish to maintain separate ownership.
http://www.propertytransfer.co.nz/definitions.php#Tenants%20In%20Common

If you own property with another person as "tenants in common", your share will be dealt with according to your will if you die. (Ownership by business partners is usually as tenants in common.)

A tenancy in common arises where friends purchase a property together, or husband and wife who wish to make provision for others in their Wills, such as a child from an earlier relationship.The property can be owned by the registered owners in whatever share on which they agree. In the event of one of the registered owners dying then their share will not pass automatically to the other one but instead pass to whoever the deceased registered owner has left it to in their Will.
http://www.seniorlaw.co.nz/sl/wellbeing/getorganised/tenantsincommon.asp


The tenancy in common setup does not split the land title in any physical way (the way a subdivision would). Instead the owners would own a share of the total title (80% and 20% in your case) which can't be specified spatially. If you intend to divide up the land and create a new title for the smaller portion then subdivision is the best option. (LINZ)

Issues:

How to deal with rates / local land taxes based on land value + improvements where each party is contributing differing levels of improvements. Difficulty splitting / sharing rates equitably.