When I bought my first home, it was assumed that we’d need a second income, which would be that of my wife. I was just leaving university and we were eager to buy our first home. A lot has changed in the market and in society since then, and buying a first home seems far more complicated, now. The current generations of first home buyers face a different reality, but it’s not as impossible to navigate as some would think. Let me first set the historical and cultural context that leads me to such optimism. It has to do with marriage.
Our forebears in many different cultures the world over used to anticipate arranged marriages. Settlements often had few options for dating and eventual mating, and considerations of material wealth were acceptable criteria for assessing potential mates for life, as part of the general goal of marrying for security. In so many situations, marriage was more about basic survival that it was a choice meant, romantically, to be for nothing other than “true love”. There were matchmakers, and dowries, arranged marriages, and seldom any divorces.
Agrarian communities would often see new housing units built on or near the family farm, and generations would continue living and working together. In today’s world, most of us live in urban clusters, and everything is mobile – even on an international scale. Our work and jobs, our capital, our education; and it’s fed by our fascination with travel, which has become affordable for the masses.
These days, families are regularly finding their members scattered across the globe, typically clustered in cities where employment opportunities abound, and relatively few of us are involved in farming. But neo-families are becoming common, as popularized by TV shows like “Friends”. We affiliate in “tribes” and we cluster in living arrangements with non-familial relations that can be as tight knit as the blood related families of the past.
Another trend these days is that traditional matrimonial family formations are happening later in life. Women are working outside the home and having their kids later. Increasingly, Dad’s can be the stay-at-home parent.
And another trend in careers and work is that either or both partners might have portable work that lends itself to part or even full-time home-office arrangements (a trend obviously accelerated by the COVID-19 crisis).
In matrimonial law, we’ve seen legal reform to fit the times. For two generations now we’ve had high rates of divorce, so that pre-nuptial and co-habitation agreements are commonly in use now, to distinguish assets and ensure that express personal estate plans will over-ride statutory directives for property splitting in the event of marital break-up.
These may seem like random and unrelated trends, but I am citing them as collectively generating the potential for partnering in the home ownership quest, either with a matrimonial partner, or with a partner of a different sort – and either through marriage, or through a well-articulated agreement for non-marital co-ownership and co-habitation.
Young renters who are used to co-habitation with rent-sharing roommates might almost as easily find themselves sharing ownership with non-marital roommates and partners, as a means toward building home equity and through that, financial security.
The tax exemption of capital gains from Canadian residential real estate that is the “principal residence” is equally available to investment partners as it is to marital partners.
At Carpe Diem we have a vision of young home buyers, many of them just leaving university and embarking on careers, merging two incomes and jointly pursuing home ownership, with or without a marital relationship. But we know that buying, furnishing, and settling into a new home for the longer term is a really big step, so we propose it be taken incrementally, through our Live to Own™ program. It’s a “try before you buy” opportunity, like any rent-to-own program would be. We’ll help with template agreements for shared financing and ownership, and set young investors up with a tax exempt opportunity to own their housing early in life.
We think that the opportunity far outweighs any concerns about contract arrangements, or about doing business among friends or family. It can happen safely, with sound agreements that provide flexibility in future living arrangements, alongside a great investment opportunity that builds financial security.