< Back to 68k.news CA front page

One in five B.C. homeowners born in 1990s co-own with their parents, says report

Original source (on modern site) | Article images: [1] [2] [3] [4] [5] [6] [7]

Statistics Canada data reveals one way kids whose parents own a home tap into the "Bank of Mom and Dad" to buy their first home in B.C.'s hottest housing markets.

Published May 02, 2024  •  Last updated May 02, 2024  •  4 minute read

Richard Bell and his children co-own a property in Vancouver. The real estate lawyer talks about why co-ownership is a growing in hot housing markets. Photo by Richard Bell /sun

More B.C. parents are using co-ownership to help their kids buy a home, according to a Statistics Canada report that examines how parents who own a home give their kids a boost in the hottest housing markets.

Released Wednesday, the report found about 20 per cent, or one in five, residential properties owned by British Columbians born in the 1990s are co-owned with their parents.

Advertisement 2

This advertisement has not loaded yet, but your article continues below.

THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLY

Subscribe now to read the latest news in your city and across Canada.

SUBSCRIBE TO UNLOCK MORE ARTICLES

Subscribe now to read the latest news in your city and across Canada.

REGISTER / SIGN IN TO UNLOCK MORE ARTICLES

Create an account or sign in to continue with your reading experience.

Sign In or Create an Account

or

Article content

Article content

"It's a good solution for families," said Richard Bell, a real estate lawyer who turned to co-ownership to help his kids remain in Vancouver. He has seen interest in co-ownership agreements "grow significantly" over the past few years, particularly among Boomers with children in the 35- to 45-year-old age range who have started to have kids themselves.

Drawing on census data from 2021, the Statistics Canada report found high co-ownership rates across Canada, with 17 per cent of residential properties owned by people born in the 1990s co-owned with their parents. The highest rates corresponded with the regions with the highest housing prices, including Vancouver, Victoria and Abbotsford-Mission, as well as several cities in Ontario.

Bell redeveloped his Vancouver property several years ago, dividing the principal residence into two units before adding a laneway house. His two children bought "part of the dirt," meaning they are on the title, an arrangement that allowed them to stay in Vancouver.

"It's the only way they could afford to live in a single-family neighbourhood with some grass in the backyard," he said.

By signing up you consent to receive the above newsletter from Postmedia Network Inc.

Article content

Advertisement 3

This advertisement has not loaded yet, but your article continues below.

Article content

The youngest resident of the property near Main Street is Bell's four-year-old granddaughter, while the oldest is his 96-year-old mother, who lives with him and his wife.

Bell said the situation is "wonderful," but added it's important for families to have a co-ownership agreement that deals with everything from utility and tax bills to division of labour on the shared property. "We recognize that we are very, very fortunate to be able to do this."

Noam Dolgin, a realtor and co-founder of the Collaborative Home Ownership Society, or CoHo, said co-ownership can present challenges, but typically the "upsides tend to outweigh them."

The co-ownership agreement should include a financial plan and a legal agreement that lays out an exit strategy if someone wants to sell, as well as a delinquency plan if someone can't pay their share of the mortgage.

"Sometimes people think they don't need an agreement because everyone is family," said Dolgin. "It's the exact opposite. If the (financial) relationship breaks up, you don't want to have that personal relationship degraded as well."

Advertisement 4

This advertisement has not loaded yet, but your article continues below.

Article content

He said CoHo helps connect people to realtors, lawyers and other experts on co-ownership. People tend to reach out for two main reasons, including those who are planning some kind of cohabitation on the property, or for an investment reason.

Dolgin said in that case, kids may be hoping to tap into the "Bank of Mom and Dad." In some cases, parents can't afford to give their children cash for a down payment, but they might be able to invest in a property together. In other cases, "it gives a child a hand up without changing the status of their estate." Parents who are worried they might need the money back for retirement have a way to get it out in the future, while helping their kids to enter the housing market in the present.

A file photo of Noam Dolgin, a realtor who specializes in co-ownerships. Dolgin is also co-founder of the CoHo Society. Photo by Arlen Redekop /PNG

The Statistics Canada data also reflects some of the reasons people choose co-ownership. In about 84 per cent of cases, the co-owned property was the child's only property. That wasn't the case for parents, who were more likely to own another property and live there. The report categorized these as "situations of mortgage co-signing," where parents helped their children purchase their first home through co-ownership.

Advertisement 5

This advertisement has not loaded yet, but your article continues below.

Article content

In 34 per cent of cases, both the child and parents lived together on the co-owned property. The report speculated that these were multi-generational homes, or cases where children were added to title for inheritance purposes.

In about 16 per cent of co-ownership cases, the child owned multiple properties including the co-owned property, leading researchers to conclude parents may be helping their children build investment property portfolios.

The study found immigrant parents were more likely to co-own property with their children than those who were born in Canada. Across the country, about half of co-owning parents were immigrants.

The study also found a link between parents' "housing wealth" and their children's ability to purchase a home — a link that was stronger in high-priced markets across Canada.

In a companion study released at the end of last year, Statistics Canada researchers found people born in the 1990s were twice as likely to own a home if their parents were homeowners, compared to those whose parents were not. British Columbians earning more than $80,000 saw a 21.3 percentage gain in their ownership rate if their parents owned one or more properties.

Recommended from Editorial

  1. How pricey is Vancouver real estate? Strangers are pooling money to buy houses

  2. No fences can make great neighbours: Vancouver homebuyers search for new comfort zone

  3. 'Bank of mom and dad' study: B.C. high earners get housing boost if parents also own

  4. Co-owner of $3M Vancouver home says living there is 'unbearable,' wants court to order sale

gluymes@postmedia.com

Article content

< Back to 68k.news CA front page