7 Smart Strategies to Make Co-Buying a Home a Success

As housing prices in cities like Toronto and Vancouver soar, many Canadians are turning to co-buying as a creative and practical way to enter the real estate market. Whether it’s friends joining forces, siblings pooling funds, or families investing together, shared ownership is helping buyers overcome affordability challenges.

But while co-buying opens doors to homeownership, it also comes with legal, financial, and interpersonal complexities. Success depends on open communication, thoughtful planning, and the right legal support.

Jump Ahead:

• What Is Co-Buying a Home?

• 7 Tips for Making It Work

• The Pros of Co-Buying

• The Cons of Co-Buying

What Is Co-Buying a Home?

Co-buying means purchasing a home with someone who isn’t your spouse—such as a friend, family member, or investment partner. It’s a rising trend among first-time buyers who are priced out of solo ownership.

One of the most important steps is creating a co-ownership agreement, which outlines:

• Ownership shares

• Mortgage and expense responsibilities

• Decision-making processes

• Exit strategies if someone wants to sell

You’ll also need to decide on a legal ownership structure:

• Joint Tenancy (equal shares with right of survivorship)

• Tenants in Common (flexible shares, no survivorship)

Knowing the difference is key to protecting your interests.

7 Tips for Successful Co-Buying

1. Create a Legally Binding Co-Ownership Agreement
Work with a real estate lawyer to formalize your arrangement. Include ownership percentages, mortgage responsibilities, dispute resolution, and buyout procedures.

2. Align on Budget, Lifestyle & Long-Term Goals
Have honest conversations about finances, location preferences, renovation plans, and how long everyone plans to stay. Discuss lifestyle expectations—pets, overnight guests, chores, and privacy.

3. Get Joint Mortgage Pre-Approval
Apply together to understand your total borrowing power. Each person’s credit, income, and debt will affect the terms.

4. Decide on Ownership Shares & Expenses
Ownership doesn’t have to be 50/50. You can divide costs and equity based on contributions. Agree on how expenses like taxes, utilities, and insurance will be shared and tracked.

5. Plan Your Exit Strategy Early
What if someone wants to leave after a few years? Agree now on how to sell the home, buy out a partner, or refinance.

6. Choose a Home That Fits Shared Living
Look for features like multiple bathrooms, separate entrances, or finished basements to accommodate individual needs and privacy.

7. Open a Joint Bank Account for Shared Expenses
Manage costs efficiently by setting up a joint account for mortgage payments, utilities, and maintenance. Assign someone to oversee payments and keep records.

The Pros of Co-Buying a Home

• Increased Buying Power: Afford a larger or better-located property together.

• Lower Ongoing Costs: Share expenses like utilities, property tax, and upkeep.

• Build Equity Instead of Renting: Gain long-term financial benefits, even if you only own a portion.

• Easier Mortgage Qualification: Pooling incomes can help with approvals and down payments.

Sample Monthly Mortgage Payments (Solo vs Shared)

Based on CREA benchmark prices, with 25-year amortization and a 3.79% fixed rate.

The Cons of Co-Buying a Home

• Financial Risk: If one party can’t cover their share, others are still liable.

• Conflict Potential: Disagreements on guests, renovations, or timing of resale can create friction.

• Difficult Exits: Life changes happen—without a solid exit plan, selling or buying out a partner can be challenging.

• Legal Complexity: Co-buying demands formal agreements and legal advice. Skipping this step could lead to costly disputes.

Is Co-Buying Right for You?

Co-buying can be a powerful tool to enter the housing market — but it’s not for everyone. It requires trust, transparency, and a solid agreement. With the right setup, it’s a smart way to share both the costs and benefits of homeownership.