“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,” said Royal LePage in an Aug. 31 release.
Leger, which was contracted by the company, surveyed around 500 Canadians aged 18 and over. Results indicate that 6 percent of homeowners co-own their property with someone other than their spouse or significant other. Eighty-nine percent of those were on the house title with family members, while 7 percent purchased with friends. Another 8 percent co-own with someone who is not a friend or family member.
Royal LePage said some Canadians are choosing to co-own property to combat housing affordability woes.
“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, chief operating officer at Royal LePage.
Ms. Yolevski cited census data suggesting 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,” she said.
Of those who co-own and cohabit a home, 49 percent say they purchased it with another party because they would not have otherwise been able to afford a home on their own.
Thirty-eight percent said that by co-owning, they were able to afford a larger property and/or a property in a more desirable neighbourhood. Thirty percent say they purchased a co-owned home because they required family support with childcare or taking care of elderly relatives.
Canadians have seen home prices and interest rise quickly and sharply, making it more challenging to meet the threshold to qualify for a mortgage, according to Ms. Yolevski.
Affordability
The company recently surveyed real estate agents across the country, with 23 percent reporting an increase in homebuyers purchasing property with someone besides a partner or spouse, compared to before the pandemic. Eight percent of agents said it was a noticeable increase.Most homeowners reported the decision to share a home was due to affordability, especially in the age range of 25 to 34 where 83 percent of co-owners said it was a “major motivating factor.”
Fifty-six percent of home co-owners own their home with parents or in-laws, while 18 percent co-own housing property with their adult children.
Almost one-third of co-owners who reported being motivated by low affordability purchased their home after Bank of Canada interest rates began rising in March 2022. Two-thirds, or 65 percent, of those who co-own report holding title to a single-family detached property.
Of those who co-own property, 44 percent report they live together with their co-owners in the home. Only 28 percent who co-own don’t cohabit with the other owner. Another 6 percent report co-owning a property but say it is used as recreational property or for investment purposes, not as a primary residence.
Nineteen percent of co-owners share an attached house, such as a townhouse or semi-detached property, and 13 percent say they share a condominium or apartment.
Ms. Yolevski said the market is a challenging one with reduced home supply, escalating prices, tightened mortgage qualification requirements, and the highest borrowing rates in more than two decades.
“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,” she added.
