Market Activity July 12, 2022

Get Into The Market: By Thinking Outside The Box

The term ‘crazy’ has been used over and over again in the real estate industry, but it’s really not as crazy as one might think. Sure, price appreciation is up (even as interest rates have increased) and buyers are being priced out of their ideal market. But there are still many options to consider to improve your chances of homeownership – and with an increase of inventory, now is the time to do so!

With inflation persistently coming in well above the Bank’s expectations and expected to remain high in the near term, the Bank raised rates by 100 basis points to 2.5% as of July 2022. However, the July rate hike may be balanced by smaller hikes later this year.

Many are being priced out of their ideal market because of the escalating prices in southern Ontario. But there are some alternative options available that allow buyers to get into the market and build equity.

Here are some options to consider to improve your chances of home-ownership.

Multi-Family Properties

Most Ontario cities have recognized the need for more housing. Many municipalities now offer two-unit zoning where single-family (one unit) housing used to exist. This creates an opportunity for some first-time homebuyers to add a secondary unit to a home that they purchase to assist with the monthly carrying costs of the homes. We are seeing this in 1000+ sq. ft. bungalows where people live on the top floor and renovate/ rent the basement to offset monthly carrying costs and mortgage payments.


 Family and/or friends have been pooling their resources to purchase a property together that they will all live in. An example of co-ownership is two different clients purchasing a 4-unit building together. Each client occupies a unit then they rent out the other two units. This fast tracks their mortgage and builds equity.

Family Investment 

Some people are lucky in that their family members have assisted them with a down payment or contribution towards their purchase. Positioning the money as an investment (instead of a donation), is attractive to those contributing. The two things that would entice family investors (or any investors in that case) would be an agreed-upon interest payment for the borrowed money, and/or a percentage of equity in the home related to their invested amount.

“It’s time to accept reality and start thinking about creative ways to get into the market.”

Focusing on alternative options allows buyers to increase their purchasing power without the expectation that their salaries will rise to compensate for the difference. Cities outside of North America have for years looked at housing with a multi-generational or a multi-family view and it’s time that we accepted our reality and start looking at homeownership with the same ideals.