Rising Case of Co-Ownership To Afford Homes in Canada
While many people choose to co-own a property for cultural reasons or to assist in the care of ageing parents or young children, more Canadians are increasingly using co-ownership to tackle housing inadequacy.
According to a survey, 6% of Canadians stated they co-own their house with someone other than a spouse or significant other in 2023, with two-thirds (76%) citing financial concerns as the driving factor. Lack of affordability was cited as the primary motivator for 83% of individuals aged 25 to 34.89% of individuals who now co-own do so with a family member, 7% with friends, and 8% with someone who isn't a friend or family member. Almost half of the respondents indicate they and their co-owners reside in the same house. Another 28% do not cohabitate, and 6% do not utilize the property as their permanent residence.
Benefits of Co-ownership
Co-ownership housing expands the options available to individuals and families and provides a range of benefits, including:
- Affordability: People can pool resources to buy a house, making homeownership more affordable. It also provides a way to build equity and the security that comes with owning your home.
- Access to more neighbourhoods: People have more housing location options within their budget (for example, residential communities with predominantly single detached homes)
- More efficient use of housing stock: Smaller households can maximize the space available in larger houses and heritage properties by co-owning them with others
- Community: Enables groups of people to voluntarily create a community environment with facilities, indoor and outdoor common spaces and services that meet their needs
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Corporate co-ownership programs are becoming more popular.
There has also been an increase in the number of companies dedicated to providing co-ownership choices for those who want to enter the property market but lack the financial wherewithal to do so on their own.
There are companies in Toronto that co-invest up to $250,000 in a buyer's down payment in exchange for a piece of the home's future worth. The benefit of this option is that the homeowners get to live in the property alone and are solely responsible for the mortgage payments. This allows them to develop equity and maybe a higher down payment in the future for a better mortgage contract.
There are many people out there who could afford to qualify for the mortgage, but they don't have a 20% down payment. This could be a great way for people to get involved a lot sooner and not that many people know about it.
In an unaffordable market, co-ownership is becoming more popular.
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. By spreading the expense of a home among a wider number of people, Canadians can not only get their foot on the property ladder more easily but also widen their home search to more desirable locales or larger properties that may not have been available with their budget alone. Co-ownership is swiftly developing as an alternative for many to obtain a foothold in a housing market that is getting increasingly unreachable, whether choosing to co-own a home with another person or organization.
Co-owning isn't just about money; it's opening up new possibilities. Canadians working together make it easier to own a home and explore different areas and houses that would be too expensive alone. In a tough housing market, co-owning a home is like a bright idea, changing how people see owning a place. It's a team effort for a better and more inclusive way of having a home. Start your home search here today.