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  • Writer's pictureandrewunsworth

Exploring Co-Mortgages: A Creative Solution for Homebuyers in Canada's Challenging Market

The Canadian housing landscape has become increasingly challenging, with home prices and interest rates on the rise, creating barriers to homeownership for many. The latest data from the Canadian Real Estate Association shows an average home price of $655,507, a 2.5% increase from last year, while the benchmark interest rate holds steady at 5%.

Given these financial pressures, an Ontario brokerage company is introducing a novel concept to facilitate homeownership: co-mortgages. The premise is simple—multiple individuals come together to purchase a home, not limited to family or friends but extending to potential like-minded investors met through networking.


Joe Bondy of Dominion Lending Centre is spearheading this movement with an event aptly named Super Mortgage Mingle. Similar to online dating, this event allows prospective homebuyers to meet others with shared housing aspirations. Bondy sees it as an innovative platform, drawing inspiration from his university days of living harmoniously with a randomly assigned roommate and observing the impact of rising housing costs on young individuals and those experiencing marital splits.


Participants of the mingle, expected to be around 30 to 40 individuals pre-approved for mortgages of approximately $300,000, will explore joint home-buying opportunities. Bondy highlights the financial advantage of co-ownership, particularly the potential tax-free earnings upon the sale of a principal residence.


While the concept is gaining traction in smaller centers and targets a younger demographic, it is not without its critics. Rasha Ingratta of Mortgage Intelligence warns of the complications that can arise when "strangers" enter into financial agreements. Drawing parallels to co-signed loans gone awry, Ingratta stresses the importance of a clear understanding of each party's investment intentions, as well as consideration for life’s unforeseen changes that may disrupt the co-ownership arrangement.


Co-ownership can take the form of joint tenants, where owners share an equal interest in the property, or tenants-in-common, where each owner's stake becomes part of their estate upon death. In any arrangement, credit risk is a significant factor if the partnership dissolves.


To mitigate such concerns, Bondy emphasizes the importance of going into a co-mortgage agreement with "eyes wide open," advocating for independent legal advice and a solid contract with a shotgun clause to protect all parties.


As Canadians continue to navigate the turbulent real estate market, innovative approaches like co-mortgages may offer a viable path to homeownership—provided they are entered into with comprehensive planning, due diligence, and a spirit of collaboration.

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