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Aug 31, 2023

Canadians turn to co-ownership to beat housing prices, inflation

To beat increasing home prices, Canadians are teaming up with family and friends to buy homes, finds a survey from Royal LePage. It shows that 6% of Canadian homeowners co-own their property with another party, not including their spouse or significant other. Of this group, 89% co-own with family members and 7% with friends. Another 8% co-own with someone who is not a friend or family member.  

Concerning their co-owning situation, 44% of co-owners say that they and all fellow co-owners live in the home together. A smaller percentage (28%) say 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. 

"Different generations of families living under one roof is not a new phenomenon, but has been growing in popularity in recent years," says 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." 

According to the survey, 76% of co-owners say that affordability was a major motivating factor in their decision to co-purchase their property. Not surprisingly, that number rises to 83% for co-owners between the ages of 25 and 34. Thirty-two percent of respondents who were influenced by a lack of affordability say that they co-purchased their property after the Bank of Canada began raising interest rates in March of 2022. 

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