Why More Canadians Are Co-Owning Homes With Strangers
One Vancouver realtor plays matchmaker to people who want to buy properties together.
As housing prices remain stubbornly out of reach, homeownership, especially for millennials and Gen Zers, is increasingly a pipe dream. But rather than giving up, many are getting creative. One increasingly popular solution is co-ownership, where friends, family members or even perfect strangers pool their resources to buy a home to share.
Noam Dolgin is a self-proclaimed “sustainable real estate” professional, who migrated from a career in environmental education to the seemingly unrelated field of real estate in Vancouver. He founded Collaborative Home Ownership BC, or “CoHo BC,” a sort of Match.com for would-be buyers to connect, meet, mingle and, eventually, make a purchase. Here, Dolgin discusses what he calls “sustainable real estate,” the rise of co-ownership and how he carefully matches would-be buyers so they never land in a messy court battle.
You have an interesting career trajectory. How’d you get here?
Before getting into real estate, I worked in environmental education and community engagement. I ran a non-profit environmental education centre in New York before moving back home to Vancouver, which is a very expensive city. Environmental education, as you might guess, doesn’t pay much if you want to buy a home here. I needed a new career that was still aligned with the values of my old one. I’d been a real estate geek since I was a child, when my parents bought an investment condo. I wanted to merge that with my passion for environmental sustainability and help people purchase homes they can afford that also let them live a lower-carbon existence. For many people, this means co-ownership. At CoHo, we help people do this better by offering professional expertise. And we do match-making for interested parties to meet and connect for possible co-ownership.
How new is co-ownership?
Historically, it’s very, very old. Families and clans have split property since ancient times. Like, forever. Real estate as we know it—a single-family existence where everybody needs to own their own house—is pretty modern. Even then, there have always been folks who pooled resources to buy property together. Co-ops were popular throughout the ’70s and ’80s. I have clients who were raised in co-ownership situations and are now looking to do that again with their own kids. Especially within the immigrant community, families buying together across generations is very common. Historically, co-ownership has always been a small part of the market. That number is expanding as conventional ownership gets more difficult.
What’s new this time around?
When I bought my first house years ago, I was lucky enough to get the down payment from the Bank of Mom and Dad. I bought a house with three suites and had renters above and below me to pay the mortgage. As prices went up, the idea of buying anything yourself became less realistic; an average minimum down payment that used to be around $15,000 in 2008 is now more than $42,000. What used to be possible for one person with a rental gave way to two or three owners. Surveys nowadays show that up to 50 per cent of Canadians would consider co-ownership as their path into the market. In 2017, that same stat was around 30 per cent. That’s a huge jump, and it directly correlates with generations: it’s about 30 per cent of Boomers, 40 per cent of Gen Xers, 50 per cent of millennials, and up and up and up. People are realizing that the current housing models and single-family philosophies aren’t serving us.
You practice what you call “sustainable real estate.” What does that mean?
The house you buy is the number one choice you’re going to make in your lifetime about social, economic and environmental sustainability. Ideally, you’ll make a triple-bottom-line sustainable choice: first, your home will sustain your social and communal needs, surrounding you with friends and family and a support system. Next, your home should be economically sustainable, in that you can afford it and also afford a life beyond just your housing costs. And finally, it should be environmentally sustainable in terms of space, land, energy use and emissions. Even though someone might have what looks like great real estate, it may not be any of those things. If you’re a couple living in a too-expensive 3,000-square-foot house on an 8,000-square-foot lot where you don’t ever see your neighbours, that’s not sustainable.
What would be a more sustainable arrangement then?
I’ll tell you about a real one that happened through CoHo. A pair of couples, previously strangers, met through us and bought a four-storey home. One family owns the top two floors, the other owns the main floor and half the basement. The other half of the basement is a shared playroom for their kids and a shared workshop for the husbands. Rather than a fence down the middle, the backyard is this huge green space with a trampoline. For much less money than they’d pay for separate units, they have more space and a built-in community.
Sounds great… if you can stay friends. What if things go sour?
I’d say 10 per cent of arrangements sour over time—which, compared to the divorce rate, is pretty low. About once a year here in B.C., there’ll be a cautionary article about a co-ownership agreement gone bad that’s landed in the courts. It’s always, always people who didn’t do their due diligence, didn’t ask the right questions in advance, didn’t get the right paperwork in place and didn’t have an exit strategy or a plan for disputes. Sometimes one party wants to move out of province, or their family grows and they need more space. If one party can’t buy the other out, then they’re forced to sell the property as a whole. Ideally, you’ve got a plan in place for anything that could possibly happen. But if you don’t, we can help to sell that share to someone who fits. We’ve been proving in recent years that there’s a market for selling those shares to new partners.
How do you make those matches?
We have a number of systems of matchmaking on our website. We use an online survey through Google Forms and we employ matchmakers to pair people together. We have online events for people to meet other potential buyers. We operate tours where we go see different properties and people can meet in person to see who’s a good match for them. For example, this week a property came up in a sought-after Vancouver neighbourhood. It’s one lot with two houses, both side-by-side duplexes. So that’s four units on the lot. Were they to sell individually, those townhouses would cost $2 million dollars each. This property with all four units is on the market for $5 million. We just put the call out yesterday and have 10 interested groups already.
What makes for a good co-ownership match?
In this case, we’ll ask people to compete on fit rather than on price. Traditionally, if a dozen people are interested in a property they’re just going to outbid each other until the highest bigger wins. Instead, we ask people to submit a letter of interest and intent: why are they a fit? How do they live their lives? How do they see themselves living on the property? When we do showings, people go and meet and chat to get to know each other. They go for coffee, narrow each other down, and choose someone who’s the best fit. It’s like dating. And like dating, it’s so individual. Maybe there’s a senior couple who’d love to have a young family around. Sometimes it’s about the property—maybe there’s a big main house for a family and a single person in a laneway house. Some people are very independent and want someone equally independent who won’t bother them.
And what’s a red flag?
Sometimes groups come together—maybe two couples, or three friends—who already know each other and have decided on co-ownership. They figure they’re already friends, and somebody’s cousin is a real estate agent, so let’s just get him and do this. Any realtor can get you a property, but not every realtor can tell you what you need to ask and do before you all commit to a $2-million purchase. It’s a red flag if you haven’t talked through every single possibility, or if you can’t communicate about hypothetical bad situations. Don’t rush into anything and take your time. The whole process is like a marriage: the first stage is dating—both in terms of people and the property. When you’ve got a sense of what you want and a potential partner who fits, then you enter the engagement phase. Now you’re putting everything on the table—you’re discussing finances, personality quirks and worst-case scenarios. If you’re still a fit after all that, then you see a lawyer, sign the papers and throw a kick-ass housewarming party.
