According to a recent Royal LePage survey conducted by Leger, six percent of Canadian homeowners co-own their property with another party, not including their spouse or significant other. Of this group, 89 percent co-own with family members and seven percent with friends. Another eight percent co-own with someone who is not a friend or family member.
Concerning their co-owning situation, 44 percent of co-owners say that they and all fellow co-owners live in the home together. A smaller percentage (28%) say that they co-own a home with another person(s), but they do not cohabitate. Six percent of respondents say that they co-own a home with another person(s) and neither party uses the home as a primary residence, rather as an investment or recreational property.
The COVID-19 pandemic forced some Canadians to reconsider their living situation, with many choosing to share living space with friends or family in a time of isolation.
“Different generations of families living under one roof is not a new phenomenon, but has been growing in popularity in recent years,” said Karen Yolevski, COO, Royal LePage Real Estate Services Ltd. “Census data shows that multigenerational households are now the fastest growing household type in Canada. Households group together for many reasons, including communal care for elderly parents, help raising children, cultural preferences or simply to be together.
However, the decision to live together, including co-owning a home is a decision increasingly made for financial reasons. In an environment where home prices and interest rates have risen quickly and sharply, and where the threshold to qualify for a mortgage has become much more challenging, Canadians are pooling their resources and buying homes together. In cases where homebuyers cannot afford to purchase on their own, they are combining their buying power with their parents, children, siblings or even friends.” “In a market beset by reduced home supply, escalating prices, tightened mortgage qualification requirements, and the highest borrowing rates in more than two decades, many buyers are having difficulties securing the property that they want. Some Canadians are using co-ownership as a way of boosting their borrowing capacity or lowering their monthly mortgage costs, helping them achieve their goal of home ownership,” said Yolevski. “By dividing the cost of a home between more people, Canadians can not only get their foot on the property ladder more easily but also expand their home search to more desirable locations or larger properties that may not have been accessible with their budget alone.”
Of those who co-own a home with another person(s) and live in the home together, nearly half (49%) say that they purchased the home with another party because they would not have been able to afford a home on their own. Thirty-eight percent say that by co-owning, they were able to afford a larger property and/or a property in a more desirable neighbourhood. Thirty percent say that they purchased a co-owned home because they required family support with childcare or taking care of elderly relatives.
“Opting to co-own with friends or family is not as simple as signing a piece of paper next to someone else's name – co-owning a home often comes with meaningful lifestyle changes, and requires in-depth conversations over financial, legal and personal obligations,” said Yolevski. “Regardless of whether you live in the home with your fellow co-owners or not, the responsibilities of owning a home with other people are shared, but so are the benefits.”