With so many Canadians locked out of the housing market, we are starting to see a rising emergence of alternative homeownership models. 

Today, owning real estate feels out of reach for so many people. In large cities like Toronto and Vancouver it can take up to 37 years to save enough for the recommended 20% down payment. With housing prices at an all-time high more and more Canadians are left stuck on the rental treadmill.

Alternative homeownership models are needed and Key is innovating to help people start owning years sooner. For first-time homebuyers or anyone feeling locked out of owning a home and struggling to get into the market, co-ownership models may be a solution worth considering. They offer three compelling benefits…

1. Lower your initial investment

Traditional ownership can easily tie up most of your money, with a recommended 20% down payment plus large monthly mortgage costs. Plus with skyrocketing prices, saving up for a large down payment can take many years, or even decades.

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In Key’s model, you can start owning starting at just  2.5% of the value of your home, depending on the building. For most of our homes, this is around $15k, which is significantly lower than the recommended 20% down payment

Having a lower barrier to enter the market means that you could become a homeowner and start building equity many years earlier. 

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2. No Mortgage

One of the biggest roadblocks to homeownership is the need to take on a mortgage. Income and savings are just two reasons people are finding it challenging to qualify for a mortgage. If you’re self-employed getting approved for a mortgage can be especially difficult.

With Key’s co-ownership model, there is no need to qualify for a mortgage. Qualifications are straightforward and can be done on our app in as little as 15-minutes. To become an Owner-Resident, we require a lower income than a mortgage and also consider credit score. The simplicity of our approval process makes it more accessible for people who are contractors or entrepreneurs to qualify as well.

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After the third year, Owner-Residents have the option to take on a mortgage and purchase their home the traditional way if they want. But there is no obligation, you can also choose to continue co-owning and building equity at your own pace.

3. Ease and Transparency in growing your home equity 

When buying a property, there are typically many associated fees.. With Keys’ monthly residency payment (MRP), every Owner resident gets a detailed invoice on the 25thof each month so you have everything in one invoice. The MRP contains a cost breakdown of what they are paying for. Plus, at least $50 each month from your MRP goes towards growing your equity. You also have the option to add to your home equity at any time and in any amount that works for you. With this transparency and ease, you can monitor your equity over time.

Our goal at Key is to create a homeownership model that works for you. By removing the two largest barriers to traditional homeowners, a large down payment and the need to qualify for a mortgage, our model allows you to start owning many years sooner.

If you’re an aspiring homeowner, learn more about how Key is turning renters into owners or check out our FAQ page to learn more about our model.