Parents, have you thought of selling half your home to your adult kids and then sharing the space?

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Family stepped in to help Aidan Grove-White and his partner afford a house in downtown Toronto, but not how you may think.

In the usual narrative of family assistance in home buying, parents give down payment money to their adult children to buy a place of their own. Here, we have the reverse: The couple bought a share of the home owned by Mr. Grove-White’s dad and stepmom a few years ago, and now the four of them occupy different floors of the duplex.

Mr. Grove-White is 44 and works in government relations; his partner, Chad Story, is 39 and works as a senior manager at a credit union. The two were looking to move out of their rental in 2016 and found Toronto home prices so high that at one point they considered moving to a more affordable city. “That was when my stepmother just said, ‘Why don’t you just buy half this house?’” Mr. Grove-White recalled in a recent interview.

Stress Test podcast: One family’s solution to Canada’s housing crisis

The 2021 census tells us that almost a million Canadian households are made up of multiple generations of a family sharing a home, a 45-per-cent increase over 20 years earlier. Expect to see more people co-owning homes as a result of high housing costs.

“One of Chad’s colleagues has actually done almost the exact same thing with friends of his, and I’ve got another friend that I work with who’s looking at how to do this with his family home,” Mr. Grove-White said. “I’m actually meeting with him and a couple of other friends.”

Here’s how multi-generational housing worked for Mr. Grove-White and Mr. Story. First, they became co-owners of the home owned by Mr. Grove-White’s dad, who is 76, and stepmom, who is 78. The house is a three-storey semi in a historic neighbourhood off Bloor Street West. It’s near restaurants and transit and other members of Mr. Grove-White’s family.

They bought their way into co-ownership by taking out a mortgage for 40 per cent of the home’s value. They gave that money to Mr. Grove-White’s dad and stepmother, who used it for debt reduction, renovations and to build up their retirement fund.

Nobody rushed into anything here. Mr. Grove-White informed his siblings, who are good with the arrangement, and the parties worked for more than six months on a co-ownership agreement that addressed issues such as the death of an owner or a breakdown in friendly relations between owners.

All is amicable in the home today, but there was a boundaries-setting adjustment period in the first six months. For example, Mr. Grove-White remembers his dad coming upstairs unannounced. “One of the things we worked on right away was to figure out how we could have more privacy.”

His dad and stepmom benefited financially from the shared arrangement through the conversion of home equity into money they could use for short- and long-term purposes. One clear advantage for Mr. Grove-White and Mr. Story was that they didn’t need a down payment.

Money they had put aside to buy a house was used for a first round of renovations on the home, which had just one bathroom. A second round is currently under way to update the living space and provide separate heating and cooling for both households.

Another advantage is that the mortgage they took out was manageable – about 30 per cent of their gross pay. “For that amount, we’d be looking at maybe a one-bedroom-plus-den condo in the neighbourhood we like. Or we’d be looking at a postwar bungalow that’s barely in Toronto,” Mr. Grove-White said.

The social benefits of multi-generational housing are just as clear as the financial ones for Mr. Grove-White and his family. When his dad had a fall off a ladder, Mr. Story was there to help. Prior to everyone moving into the house, Mr. Grove-White said his parents had already started thinking about how they would manage their home as they aged. Now they have the help they need to stay put.

The potential reciprocal benefit for Mr. Grove-White and Mr. Story is child care. They have been thinking about starting a family some day, and if that happens there’s help just downstairs. “My stepmother is huge on that,” Mr. Grove-White said. “She wants us to have kids already, and she imagines herself and my dad basically hanging out upstairs, looking after the kids while we go out.”

Unaffordable housing has prompted Canadian parents to pour billions of dollars into down payment gifts for their adult kids. Another thought: Have your kids move in and pay you for a share of the family home.

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