Co-Ownership Case Study: Richard, Paul and Emma

Three architects decided to buy a property together in downtown Toronto. Four years, multiple renovations, and a baby later, co-ownership enabled them to buy their own homes in the city.

Who were the Co-Owners?

Group 1: Richard

Group 2: Paul and Emma

Richard and Paul met at university while studying architecture. After returning to Toronto to start their careers, Richard on his own, and Paul with his partner Emma, they looked at options for buying their first homes.

They knew that they wouldn’t be able to afford a place on their own, but buying together seemed like an obvious way to get their feet on the property ladder, as they were in a similar position and had known each other for a long time.

Their Wants and Needs

Richard was looking for a home in the city within biking distance of the downtown core, ideally under $300,000. Paul and Emma were in search of something similar, with the extra stipulation that they would prefer a house to a condo. As architects, they wanted something they could improve and alter to suit them over time.

The Property

They thought a duplex with two separate units would work nicely, with both parties occupying separate living spaces. After extensive conversations detailing what they were looking for and their criteria, outlining who would be responsible for what, researching possible ownership structures and legalities, meeting with real estate agents, lawyers and mortgage brokers, they purchased a house with two units. Richard moved into the main floor unit and Paul and Emma into the second-floor unit.  

Their Co-ownership Agreement

Before purchasing the property, the trio finalized a co-ownership agreement detailing ownership shares (Richard owned 50% of the property, and Paul and Emma held 50%), how to manage finances and maintenance, and defining strategies to address any potential issues like separation or a desire to exit.

From a financial perspective, even though each family owned 50% of the property, the units were different sizes. To account for this, each family paid ‘rent’ to a joint account based on the market value of the unit. The rent included a 15% premium to account for the mortgage, utilities and any house maintenance or unexpected expenditures.

Financing was not difficult to arrange - they worked with a mortgage broker who was able to find them a mortgage relatively easily.  

Four years, renovations, and a baby later - how did they adapt?

Through the years, they underwent many renovations: added insulation, converted the third-floor attic into a bedroom, renovated one of the kitchens, and installed a communal laundry room in the basement.

When they converted the attic into an additional bedroom, Richard decided to contribute to the costs even though this was Paul and Emma’s unit because he wanted to benefit from the equity appreciation. This also shifted the balance of ‘rent’ paid into the shared bank account as the second-floor unit was now worth more.

The families sat down once a month to review expenditures and discuss any upcoming projects or items that happened in the last month.

After four years, Paul and Emma were expecting a baby, so the trio discussed exiting the arrangement. Paul and Emma needed more room with kids on the way, and Richard was now in the position to buy his own home.

The group had an independent evaluator value the house to establish a fair market price. Paul and Emma re-mortgaged to purchase Richard’s half, and to cover their new larger mortgage, they severed Richard’s apartment in two, converting the basement and ground floor into rental units for additional income.

Richard has purchased a house independently with the funds from selling his unit to Emma and Paul.


To anyone considering co-ownership, Richard’s nuggets of advice are:

  • Perform extensive screening to ensure that partners are compatible.

  • Discuss thoroughly before signing any legal agreement on how to manage money and maintenance.

  • Get help from people who have done it before to save a lot of legwork and painful lessons.

Asked about whether or not he would do it again, Richard says ‘Yes!’:

“You have to be open to negotiating and compromising as well as be willing to share your finances, but overall it was very valuable for all of us.”

His final words of wisdom are, of course: “get in as early as possible  - the market is getting harder.”