Getting your foot into the housing market has become more difficult than ever. In Canada, we’re seeing housing prices skyrocket, especially in big cities like Toronto where the representative home price is now $1,146,667. According to the National Bank of Canada, for young Canadians today it takes an average of 28 years to save for the recommended 20% down payment in Toronto, and 36 years for Vancouver.

And as we enter into 2022, we’re continuing to see this upward trend persist, in fact, the 2021 RE/MAX Housing Affordability Report expects Canadian residential housing prices to rise by 9.2% in 2022. With soaring housing prices, the dream of owning a home and having enough to put down for a large down payment is seeming more and more distant.

Young Canadians are being locked out of owning. While 72% of millennials have the goal of becoming a homeowner, a KPMG study found that almost half (46%) feel that homeownership has become a pipe dream. Additionally, half of Canadians under 30 have given up on owning a single-family home. 

With so many Canadians locked out of traditional owning, it begs the question: what does homeownership really mean? At Key, we are seeking to expand this definition. To us, owning a home means holding an economic asset as well as having a place to live and make your own. We believe that these benefits can be delivered without the need to take on a large mortgage and get locked into a long-term commitment.

1. Building home equity

With Key’s co-ownership model, instead of needing to save for at least a decade to put down a 5-20% down payment, you can start owning with an initial investment of just 2.5% (this is around 15k for most of our suites), so you can start building home equity many years sooner. 

As an Owner-Resident, like with conventional homeownership using a mortgage, you have an equity position starting from day one that can grow in value over time. Plus with Key, the more of your suite you own, the less your monthly payment will be. Our model allows you to build equity without being house poor or sacrificing your freedom and quality of life. 

2. Leverage

Key offers a Co-financing Benefit, which allows Owner-Residents to build home equity faster. For every $1 you  invest, you will also receive $1 in leverage. This benefit is applied up to when your home equity reaches 25% of the value of your suite, at which point it is applied at a lower ratio. Unlike a traditional mortgage, Owner-Residents can benefit from this leverage without having to take on any debt. 

Being able to grow home equity is one of the best ways to build personal wealth, with Key you can start doing this many years earlier compared to a traditional ownership model where it takes decades of saving for a higher entry point as housing prices get further and further out of reach.

3. Increased security of tenancy.

Having a place to live with the comfort of knowing you have security of tenancy is one of the key benefits of traditional homeownership over renting. As a renter there is always that dreaded 60-day notice in mind. 

With Key’s model, Owner-Residents have improved security of tenancy. The Owner-Resident and property owner are signed to a 3-year term. After this point, Owner-Residents can decide to take on a mortgage and buy the whole suite, but there is no obligation. You can continue to stay a co-owner if you prefer. Either way, you are building home equity from day one. You can learn more about how Key is turning renters into owners, and providing increased security of tenancy here. 

4. A home you can make your own

Being an Owner-Resident with Key means that you have a home that you can really make your own. Each of our Owner-Residents brings something unique to the table, and we encourage them to express their style through the way they design and decorate their homes. 

As an Owner-Resident you have the ability to make renovations, such as structural changes and additions to the interior of your suite as long as it meets the requirements of the building, and is approved by Key and the Condominium Corporation. Key will also help the Owner-Resident find a contractor, by offering an approved list of qualified contractors.

If the renovations to your suite impact the value of the suite they will be added to or subtracted from the suite’s value. 

At Key, we’re providing our Owner-Residents with the pride and comfort of homeownership, without needing to take on a large mortgage and large amount of debt, or sacrificing the freedom typically only available with renting. . 

Real estate of the 21st century needs to push the envelope of innovation. We can no longer look solely towards two binary solutions to real estate, renting and owning, that hold such narrow definitions.

Through removing the two biggest barriers that come with traditional homeownership, a sizable downpayment and taking on a mortgage, our innovative model allows people to get onto the property ladder faster and start building equity from day one. If you’re interested in Key’s co-ownership model as a solution for you, you can learn more about if co-owning makes sense for you and how Key compares to traditional ownership