More than a third of Gen Z plan to co-own a home with family or friends, survey finds

While househunters today may be known for tapping the bank of Mom and Dad to get into Toronto’s overheated housing market, many Gen Zers plan to take a different approach for their first home purchase: co-owning with their family and friends.

That’s according to a new survey that found, despite the widening gulf between incomes and home prices, a third of Gen Z plan to buy real estate in the next five years.

And 37 per cent plan to share ownership with family or friends.

“It’s a departure from the way people have bought homes historically,” said Don Kottick, president and CEO of Sotheby’s International Realty, who, with Mustel Group, surveyed 1,502 Canadians age 18 to 28 in Vancouver, Calgary, Toronto and Montreal on how they plan to buy their first homes.

Co-owning can take different forms but usually means sharing title and mortgage on a house.

In the Greater Toronto Area, 26 per cent of those surveyed planned to co-own their first home with family, while another 12 per cent expected to buy with friends. That came second to Vancouver, where 27 per cent expected to co-own with family, and 13 per cent with friends.

“With affordability being an issue, and the cost of living being as high as it is, people have to get creative,” Kottick said.

Lesli Gaynor, a Toronto realtor who facilitates co-ownership arrangements through her company GoCo Solutions, says she’s seeing a “huge increase” in interest in co-owning.

She’s had clients where a parent co-signs with a child as well as groups of friends who buy a house together. In other cases, seniors are looking to share their homes with individuals who can keep them company or help with snow shoveling or other tasks.

“We have to start looking at home ownership as something that doesn’t have pride of individualism anymore,” Gaynor said.

Her team regularly fields calls from clients who are serious about co-owning. The company launched a beta version of an app in January that matches clients with potential co-owners. It has seen 90 sign-ups without any marketing, says Parimal Gosai, adding that interest in co-owning has grown “exponentially” since he joined GoCo Solutions three years ago.

“There’s a real desire for people to get into the housing market,” he said. “We’re fielding around five to 10 calls around co-ownership” every week.

Some Gen Zers, however, still plan to seek financial help from their family rather than sharing a title with them.

About half of overall respondents to the survey said they’d look for financial help from family or through a nonmortgage bank loan for their down payment. In the GTA, where more than a third expected to pay $750,000 or more for their first home, 27 per cent expected to rely on family and 26 per cent on a loan.

In the current market, a recent Toronto Regional Real Estate Board report said as of Fall 2021, 17 per cent of first-time buyers, irrespective of age, expected to rely on gifts from friends and family for their down payment. That’s compared to 11 per cent of buyers overall.

According to the Sotheby’s survey, in Montreal and Calgary, a large segment (41 per cent and 44 per cent, respectively) of Gen Z buyers expected to pay between $350,000 and $499,999 for their first home.

The survey was the second in a multi-part series exploring housing trends and expectations for Gen Z adults in Canada.

The first report found most young Canadians living in big cities worry rising real-estate prices and the cost of living means they won’t be able to buy a home in their community of choice.