Tenancy in Common - Is this the magic bullet?!

Tenancy in Common - Is this the magic bullet?!

Liz Wilcox and her husband dreamed of owning a house in East Vancouver with a backyard and playroom for their two little boys, but they couldn’t afford the $2-million pricetag on their own. “We just decided that the best way to get more space would be to split a house with someone,” said Wilcox, whose family of four was living in a 680-square-foot condo at the time.

When she couldn’t find a match among her family and friends, she posted an ad on a website created by realtor Noam Dolgin, who specializes in home co-ownership. The message, she recalled, said something like: “Couple with two small children and $1 million looking for like-minded people to share a house in East Vancouver.”

Ashley Pullman and her partner, who were also investigating co-owning as a way to afford a house with outdoor space close to their work, saw the ad and reached out. After they exchanged emails, Dolgin arranged for the four adults and their children to meet at Trout Lake Park in the summer of 2021. “Straightaway we clicked,” Wilcox said. “There were no red flags,” Pullman added. “We were able (to start) coming up with a type of ideal location and housing configuration that would work.” Despite being total strangers, they bought a home together a few months later. And they’ve been sharing it successfully ever since.

It’s been common, of course, for generations of families to live together in one house. But there is a budding trend in Metro Vancouver of strangers pooling money to buy real estate, says Dolgin, who started his Collaborative Home Ownership website seven years ago. “It’s really been growing over that time,” Dolgin said, “as more and more people realize that this is really a pathway to home ownership.”

Dolgin has several classified ads on his website right now, similar to one posted by Wilcox, of strangers looking for real restate allies. One reads: “Family of 4 with a newborn and toddler seeking partners to share a home with a strong walk score and a guest/rental suite in East Vancouver. The family is seeking 3 beds, 1,000+ sq ft for under $1 million.”

Earlier this year, Dolgin brought together two couples who pooled their money to buy another East Vancouver house that they have split into separate spaces for each family. They met each other at one of his “shareable home tours,” when the realtor takes people interested in co-ownership to open houses of properties that could be divided. He has a growing list of other examples, including helping a group of strangers buy eight small cottages in Horseshoe Bay where they now live together and share a single mortgage. It’s difficult to get tangible data on home co-ownership. But Statistics Canada census data would suggest it’s on the rise, said Andy Yan, director of Simon Fraser University’s City Program.

The number of Metro Vancouver households with three or more people paying the mortgage or rent has risen from three per cent in 2001 (22,330 households) to eight per cent in 2021 (80,080 households), an increase that far outstripped the overall growth in the region during those two decades, Yan’s analysis shows. Surrey had the largest jump: from four per cent in 2001 to 13 per cent in 2021. These stats cover a single household where three or more people are contributing to the mortgage or rent. It would not count tenants living in a secondary suite because they would be considered their own households.

Yan cautioned, though, that he was unable to tell in how many cases the three or more financial contributors were all owners, as opposed to one owner with several renters living with them. But the overall growth of multiple people paying to maintain one dwelling suggests Vancouverites are combining cash to afford to live in Canada’s most expensive real estate market. The reasons behind this, Yan said, likely run the spectrum of cultural practice to people coping with the high cost of living. “Over time, households in Metropolitan Vancouver have slowly consolidated to survive,” he said. Residents in other expensive cities have also dabbled with this, such as in San Fransisco, where there is an ownership model called “tenancy in common,” or TIC. “A colleague of mine told me TIC is the equivalent of getting married. And the filter process should be just as rigorous,” Yan added. “Because, remember, half of Canadian marriages end in divorce.”

Nicola Ingram bought an East Vancouver house with a friend in 2015, where she and her son lived independently on the main floor while the other woman resided upstairs. After eight years, her friend is now selling her 50-per-cent stake in the 2,838-square-foot house for $1.025 million, but Ingram wants to stay. So she will choose who will buy her friend’s half of the house, and is interviewing prospective purchasers to find the best fit. The benefits of joint ownership, she says, include sharing communal objects such as a lawn mower, and knowing you are not alone when it comes to financial obligations. “You’ve got a team, in a sense, to support each other with both the repairs and the upkeep,” she said. This time around, Ingram will cohabitate with a stranger. She hopes to establish, though, a formal agreement with her new co-owner so they are both happy with the living arrangement, adding this type of collaboration gives people more flexibility compared to condos where strata councils set the policies.

Finding the right buyer may take time, given this is still a new concept for many people. “I think it’s very much a growing market in terms of people being interested in co-housing, but it isn’t the usual way that people think about doing things,” she said. Ingram, though, is not treading on new ground. Earlier this year, her realtor, Dolgin, sold a 55-per-cent stake in an East Vancouver house, where one of the co-owners was selling their suite on the top floor of the house. Realtor Connie Buna, who represented the buyers, said while the departing co-owner set the $998,000 price, the remaining co-owner decided who would get to purchase the suite by meeting the applicants in the backyard.

“They had set up chairs and they were serving tea. And they were literally having a meet-and-greet with people, and it was lovely,” Buna said. Her clients, a professional couple, were the successful candidates because the remaining co-owners concluded they shared similar beliefs, communication skills and ways of making decisions, Buna said. “They’ve just recently sent me a note to share how much they’re enjoying the experience, and the ways in which their friendship has deepened.” In this case, the original co-owners were very organized, something that Buna said is very important for anyone considering this type of ownership. “These folks really had their ducks in a row when they got into this co-housing purchase at the onset. They had really well-established agreements around what this exit might look like.”

As consumers learn more about these housing options, so too are banks and lawyers who are “evolving” their policies so that such transactions are less complicated to finance and legalize, Buna added.

Dolgin was among the first to start promoting this form of co-ownership in B.C., as a partial solution to soaring housing prices. Compared to condos and townhouses, he calculated this option could be more economical, net more indoor and outdoor space, and provide control over who you live beside: “They’re not just some random assortment of strata owners.” Some clients like his idea, but need help finding partners. So he facilitates real estate “matchmaking” through “online speed dating” events, group tours of “shareable homes,” and offering classified ads on his webpage. But he stressed that people must do their homework before entering one of these transactions, so he created a 23-page guide that covers issues such as legal agreements around finances, an exit strategy when one party wants to sell, and things to consider when looking for the right partner. Is smoking allowed in the house? What about late-night, loud parties? What should the landscaping look like?

“You definitely want to do your due diligence. You don’t just want to jump in and then figure it out later,” Dolgin said. “You want to really get to know your partner to make sure you’re socially compatible.” While many of his co-ownership sales have been in Metro Vancouver, he has worked with realtors in other parts of B.C., including Victoria, where he helped two sisters buy a property by finding a stranger to join them in the purchase.

Some cities have approved co-housing buildings, such as Driftwood Village in North Vancouver and Little Mountain in Vancouver, where residents share amenities such as a children’s playroom, work shop, office space and party room. However, in co-housing buildings, each suite is stratified, so the homes are not jointly owned through a single mortgage.

One of Dolgin’s most unique deals was in Horseshoe Bay, involving eight 100-year-old cottages on one lot perched above the ocean. When the property was listed for sale for $3.8 million in 2021, Dolgin facilitated a meeting to discuss the possibility of co-ownership, a process the seller supported as he didn’t want the cottages torn down for redevelopment. Matt Fidler, who needed a new home because his long-time rental house in East Vancouver was scheduled for demolition, attended the meeting and was instantly hooked, along with some other outsiders and a few existing tenants. Together, they found more “community-minded” people who wanted to buy into the project and live in the cottages, as well as some external investors who helped to finance the deal and now own a stake in it.

At the end of the complicated process, a group of eight owners, ranging in age from their late 30s to 60, each have their own small home and tiny yard, but share the mortgage, the cost of repairs and upkeep, and the extensive green space that weaves through the buildings. There are “good days and bad days,” Fidler admits, as they navigate renovating the cottages on a “shoestring” budget. But they have found a balance between sharing communal gardens and common areas, and having enough privacy in their own homes. “I’m extremely proud of our group for how well it’s gone,” he said. “You basically get a miniature house in the most expensive postal code in Canada, and none of us would have any ability to afford that on our own. But together we can.”

That was true for Heidi Woodley, a single mother of two young boys who had been renting one of the cottages before the sale. She’s thrilled to now own a chunk of real estate, but acknowledges there have been challenges adjusting to living in such close proximity with her co-owners, and deciding what problems to prioritize and how to make difficult decisions together. “It’s a delicate balance between the ability to be self-determined and to have your privacy when you band together with people to survive in tough times,” she said. On the positive side, her boys, aged nine and 13, love to roam on the half-acre property. “It is my wildest dreams in terms of a village that I could raise my kids in,” Woodley said. “Everybody loves my kids, and they are so kind to them. And my kids learn all kinds of things (from the cottagers).”

Both Woodley and Fidler believe this is one possible way to address the “chaos” of the housing crisis: offering entry-level home ownership to people who otherwise couldn’t afford to buy, either through similar properties to theirs or by building small homes in the spacious backyards of existing houses. “We think we found another interesting tool to get us a bit further into the future,” she said.

According to an Ipsos poll released in April, half of Canadians said they would consider co-ownership with family or friends so they could afford a home, although the poll didn’t ask about buying with strangers. The idea was appealing to more than two-thirds of younger people, ages 18 to 34, far higher than for older age groups.

Pullman, the mother of a two-year-old, said she and Wilcox and their partners knew fairly quickly that they would be compatible home owners because they had the same priorities: the house had to be easy to divide into two private living spaces, and needed outdoor space. The location had to be in East Vancouver, close to transit and in a walkable community, and having children the same age meant roughly similar schedules and the sense of a “village” on the property. The process of going to open houses helped, because it sparked conversations about: Could we share this? What would be the compromises? They split the cost of their $1.85-million house evenly. The families live separately — each has a three-bedroom, two-bathroom suite — but share a playroom and work shop in the basement, as well as the front and back yards.

Both women say the key was good communication as they debated how to split up and renovate the house: Wilcox, her husband and two boys now live on the main floor and part of the basement, while Pullman, her partner and their son have the second floor and attic. “It was definitely hard work,” Wilcox said. “It was challenging, but fun.” Pullman said buying with a stranger means you can choose someone who wants, for example, the same location and price as you. And there is less pressure to socialize all the time, compared to if she had bought a place with a friend or relative.

The women, who have become friends, get many questions about sharing a mortgage with someone they just met, but both insist learning to trust each other was not hard. They have a contingency fund for emergencies and an agreement that covers what happens if one family has to default on a payment. “Of course, it’s risk. Of course, we haven’t made all the right decisions. But that’s just life,” Wilcox said. “We still got more than we could on our own. There’s no way we would have all of this space and all of this outdoor space. That was the biggest thing to me. We got more together than we could on our own.”

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