the Cost of Home Ownership
Today's rising real estate prices in Calgary are
presenting a challenge to many people wishing to enter the housing
market. First-time buyers in particular are finding they have to make
adjustments as they plan their dream of owning a home. Young people
are staying at home longer in order to save for a down payment. Also,
many homebuyers are downscaling their expectations, and choosing a
home with a rental apartment or a flat to help with
There are some other alternatives available to
help home buyers build some equity in the real estate market. One
option that may be of interest to certain individuals is the joint
purchase of a multiple-dwelling property by more than one family
group. For example, a legal duplex might be jointly purchased by
friends or relations, with each family occupying one of the property's
units. The duplex approach can work well in situations where young
people plan to marry, leaving their parents as "empty
nesters". In this scenario, the family home is sold, with the
parents buying one unit of a new duplex outright, and banking their
surplus funds. The younger generation then assumes the more manageable
mortgage payments on the remaining half of the duplex's price. In this
way, they can start to build equity immediately without having to come
up with a large down payment, or getting into a high ratio mortgage.
In less formal arrangements, two couples may
elect to jointly buy one single-family residence and share all the
living space. This can prove to be a very stressful situation, and the
best chance for success is usually when there is a family relationship
between the two couples, such two siblings with their spouses.
Whatever method you use to
ease the cost of
homeownership, the most important thing to remember is to get the all
the details worked out before you buy. Everyone involved in the
purchase should agree on all sub-lease and re-sale provisions "up
front". For example, can one party move out and sublet their
living space to someone else? Also, what happens when someone want to
sell? Does one party have the right to buy out the other's interest?
If so, how is a fair price determined? Or, is the property put on the
market with all parties sharing the proceeds?
As you can see there are a lot of variables to
consider. Such important issues should not be left to chance. Don't
expect that they'll be sorted out easily when the time comes. The best
course of action is to get a lawyer involved and draw up an agreement
that clearly sets out the rights and obligations of all co-owners.
Remember, when you're thinking of creative ways
to ease the cost of owning a home, talk it over with me first.
Tell us all about your plans, so we can ensure that you are shown
homes that conform to the appropriate zoning and municipal by-laws.
Best of all, we may be able to suggest options that you'd never
considered, and help you make your home
ownership dream a reality.
To view my testimonials
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2000 - 2010
writing by Steve Kelly or as credited.
Calgary Real Estate consultant Diane Kelly, Discover Real Estate Ltd,