Real Estate

Co-Ownerships - The Catch?

  • Last Updated:
  • Apr 18th, 2020 10:45 pm
User avatar
Oct 31, 2019
429 posts

Co-Ownerships - The Catch?

On occasion, I see a co-ownership property sold which appears to be tremendous value compared to other nearby condos. Here is one example

I understand that this unit is not in a new building, poor amenities, etc.....but even after factoring that the value considering the square footage + parking space is undeniable.

So what's the catch? I understand that you technically own shares in the building rather than the unit (which makes financing more difficult and high ratio mortgages impossible), but why would someone who can put down >20% not want to purchase this unit? The price tells me that there's something that I'm missing
2 replies
Deal Fanatic
Jul 3, 2011
5781 posts
I don't know where you are but there are only a couple dozen at best co-op buidings in Toronto - the co-ops red-headed cousin.

You're correct about the mortgage hurdle it's precisely because of the share ownership. In a typicalconso-ownership , mortgage lenders are principally risking the default of one owner whose property, places their mortgage lien almost at the very top of the pecking order. Whereas with a co-ownership arrangement, the ender is not just assuming the borrower's risk but also the defacto risk of every other-co owner over whome they have no oversight and no control.

Co-ops though are generally wel run and stringent because of the risks involved. They can be great communities unto themsleves and provide larger units at a lower cost.
Deal Addict
User avatar
Dec 13, 2016
3704 posts
He is probably talking about Hamilton. It's a co-op mecca