Co-owners either have :
- equal shares of the property and equal decision-making power
- different levels of shares and decision-making power
Ownership as a group of individuals
Every co-owner is on the property’s ownership title, either as “tenants-in-common” or as “joint tenants.”
If a tenants-in-common co-owner dies, the ownership does not automatically go to other owners. Their share of property becomes part of their estate.
If a joint tenant co-owner dies, surviving co-owners inherit the deceased’s share of the property.
Ownership through a corporation
The home’s title would be held by the corporation or a co-operative corporation created by the co-owners.
Corporation ownership may make it easier for co-owners to sell or transfer their share without requiring the owners’ names on property title to change.
In homes that are divided into separate units, co-owners can also establish a condominium corporation where each co-owner owns their own unit and a share of common amenities.
A condominium is not a certain type of building (such as a high rise) but a form of ownership that may apply to smaller housing types such as units within a single house. Condominium owners may be involved in the board of directors and would be subject to the by-laws and rules of the condominium.
Each unit’s owner has the right to sell or transfer their unit to anyone they choose, and to obtain their own individual mortgage.
There are several steps involved in creating a condominium corporation including a requirement for municipal planning approvals.
More information about condominiums and how to create a condominium corporation is available on the website of the Condominium Authority of Ontario.
Ownership shares and decision-making power
A common type of co-ownership structure is when all co-owners have equal ownership shares and decision-making powers. There may be situations where co-owners agree to different levels of ownership shares and decision-making powers.
For example, one co-owner could contribute more towards the house purchase than another co-owner. The two co-owners may agree that the person contributing the most has more say in the decision-making.
In cases where co-owners contributed different amounts towards the purchase price based on unit size, decision-making could be based on the percentage amounts each have paid.
Examples of co-ownership
The following case studies show different home co-ownership models that address different objectives and needs.
Example 1 : Build a caring community
A group of seniors wants to age in a caring community rather than live alone. They use the savings or profit from the sale of their homes to purchase a home together.
They renovate the house to include accessible features. The house includes a shared kitchen and living room, and together, the residents buy and prepare food, as well as arrange cleaning services.
The group also decides to create some private amenities, including an ensuite bathroom for each bedroom.
Example 2 : Access to homeownership
A group of young adults buy a house in a community of single detached homes.
By pooling their resources, they can make a 20% down payment on the house allowing them to avoid mortgage insurance. The co-owners contributed different amounts towards the purchase price, so the percentage of the house each owns varies.
This co-ownership arrangement will allow each person to build equity and eventually buy houses of their own.
If major renovations are made to the house, the costs will be split based on the percentage of ownership. Ongoing operating costs are shared equally, as are basic responsibilities for the care and upkeep of the house.
Example 3 : Meet the needs of two families
Two families with children want to live in a neighbourhood where they can’t afford to buy a house of their own. They decide to buy a house together that will have private units for each family and a shared yard for the children to play in.
Sharing babysitting and having potential friends for their children while living in the same house are further advantages to co-ownership.
Their plan is to co-own the house for about five years or until they are both able to buy their own houses.
There is another form of ownership which may be confused with co-ownership housing, called “co-housing.”
Under co-housing, residents both :
- own their individual homes or condo units
- share ownership of a “common house” with shared amenities
This is different from the focus of this guide, which is on the co-ownership of a single house.