Getting a Mortgage With Your Kids

3 Reasons Why Getting a New Mortgage With Your Adult Children May be a Wise Investment in Your Future

We’re following up our recent article, which went out to young singles and couples who wonder if getting a mortgage with their parents is a good idea. If you’ve been approached about a real estate investment by your adult child recently, that’s on us. On the surface it may seem as if the scenario is about them simply asking for help, which you may be happy to offer. However, we encourage you to look at the prospect as an opportunity that is ripe with benefits that you may not have considered. Have a look at these advantages which we have listed below.

Invest Beyond of Your Empty Nest

With your grownup child having left (or about to leave) the family home, it is now a proverbial empty nest. There’s nothing to be sad about folks, as by partnering with your child in a mortgage you now have an opportunity to sell your current home. From here, you can buy into a smaller and more appropriately sized home/condo, and use the excess funds for the very same real estate investment. And when it comes to real estate investment in Canada, there is nary a better place to make it than here in the BC Southern Interior. By sharing the mortgage on this venture, you greatly reduce the capital needed for the downpayment and monthly mortgage expenditure. In this scenario, you own your own, smaller and more efficient home/condo, and also have another residential property in your portfolio. Even though it’s shared, you have now increased your equity.

Another opportunity, is to leverage the property on the rental market. If your child doesn’t need to occupy the abode, you can rent the whole home out for a longterm lease and generate consistent revenue. Or, if they do want to live on the property, consider investing in a home with a basement suite or other extension that allows you to rent the suite/extension on either a longterm or short term basis. The latter can be very lucrative in the Okanagan Valley. It has become very common for homeowners with debt left on their properties to use Airbnb or VRBO revenue to pay off their mortgages. To ensure you reap the benefits without taking on any headaches, simply let your child manage the landlord duties. Don’t worry, you can blame us for suggesting the latter.

By investing in a home with your kid/s you will have opened up your world to a whole new way to generate income and wealth as you prepare for (or are already enjoying) retirement.

Secure Your Vacation Dream Home, Today

If you live the Okanagan Valley, you are already in an idyllic vacation community. But now you have the chance to own a vacation home in Canada’s western paradise. If your child approaches you about getting a mortgage together (again, our fault) suggest that you’d be happy to share the downpayment and mortgage payments, with one small caveat – the home will be used as a vacation home for you, and the family. When not in use, the property can be placed on the aforementioned short term rental market to generate revenue, which works in both of your favors. It’s a win-win all around.

Do It for the Grandkids!

Above we have detailed why getting a mortgage with your child can work in your favor. To reiterate, it will help you build wealth and generate income in your retirement years, while providing you with the vacation home you’ve always dreamed of. However, there is one piece of the decision making puzzle where you are absolutely allowed to let your heart guide the way. – you current or future grandchildren. It’s one thing to help your adult child make wise financial decisions, but when you consider that the home you’re sharing investment in will be handed down to your precious grandkids you have all of the incentive required. Imagine gifting them with real estate equity so early in life? You’ll provide them then head start that you and perhaps your own children didn’t have. This one tugs at the heart strings folks – and that’s what it’s all about.

The Penticton and BC Southern Interior market is prime for low risk real estate investment. If you’ve been following our Bank of Canada mortgage rate announcements and Penticton real estate news updates then you know that buyers are finding favorable fixed mortgage rates and near record low variable rates. Despite a tumultuous economic 18-months, a perfect storm for buyers has been created across Canada. The BC Southern Interior is at the forefront of opportunity. The issue, is that the buyer’s market and correlated trends are not expected to last for too much longer. As 2022 progresses inventory may tighten, values of desirable properties will rise, and rates will increase as the economy comes back with a roar. The time to act is now. If you have any further questions about entering into a shared mortgage with your children, contact Carloni Mortgage Brokers in Penticton BC today at 250-493-9111.