Homeownership, whether it’s a single-family home, duplex, townhouse, or condo, remains a key goal for an overwhelming majority of Canadians and newcomers to Canada.
A 2022 study by the research firm Ipsos Public Affairs found that a large percentage of newcomers to Canada are homebuyers within their first five years of arriving.
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All Canadian homeowners quickly discover that homeownership comes with costs: a mortgage, insurance, and monthly maintenance, in addition to daily living expenses.
Mortgage costs are on the rise
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Since March 2022, the Bank of Canada has raised the policy interest rate to 4.5 percent from 0.25 percent.
It’s estimated that the 1.4 million Canadians who got a mortgage in 2020 or 2021 may have seen their median monthly mortgage cost go up by $420, or 30 percent upon renewal.
According to the Globe and Mail’s David Parkinson, economists at Desjardins Capital Markets have issued a dark warning about how much more damage high-interest rates could inflict on the mortgage and housing market, calling it a ticking time bomb.
One effective way for Canadian homeowners to handle those homeownership expenses and challenges is to become a home-sharing host.
How does home-sharing work?
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Home-sharing hosts rent out spare bedrooms in their homes to long-term housemates in exchange for rent (and possibly added help around the house and companionship).
Become a home-sharing host
And while the home-sharing concept isn’t new, Prepare for Canada and Sparrow Share have recently partnered to offer a unique and fulfilling path for newcomer homeowners to become home-sharing hosts.
Oren Singer, the co-founder and CEO of Sparrow, says Canada needs “to do a better job of making it easier and safer for newcomers to find good housing options in Canada.”
“There’s a ton of underutilized housing space in the form of spare rooms and basements,” said Singer.
“With the cost of living so high these days, we’re seeing many homeowners turning to home-sharing as a way to supplement income.”
Oren singer, co-founder & ceo, sparrow
Sparrow estimates that there are over 12 million empty bedrooms across Canada.
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Rental demand continues to rise
In Ontario, it’s estimated that more than half of residents — and three-quarters of those over the age of 65 — live in houses that are bigger than they need. That adds up to five-million spare bedrooms across the province, according to a pre-pandemic report by the Canadian Centre for Economic Analysis.
Meanwhile, rental demand (and prices) across the country continues to surge.
Canada aims to welcome 465,000 new immigrants this year after admitting a record-breaking 431,000 newcomers in 2022.
The country hopes to land 485,000 newcomers in 2024 and 500,000 in 2025. Canada has also welcomed a record number of international students, with those numbers expected to increase.
Newcomers struggle to find accommodation
Newcomer homeowners know from experience that for most immigrants and international students arriving in Canada, finding accommodation can be difficult and stressful.
The Prepare for Canada/Sparrow initiative offers an uncomplicated home-sharing service to help homeowner hosts find, connect, and match with a verified pool of potential housemates, says Dave Frattini, Managing Partner, Prepare for Canada and Rentals for Newcomers.
Housemates can rent a room for as little as two months or up to a year.
Sparrow matches hosts and housemates
Sparrow, says Singer, does the credit and background check and attempts to match hosts and housemates based on compatibility.
Hosts can list their space and create a profile for free. A service fee for hosts is only charged once the host has received the first rental payment from the housemate.
The host service fee (a one-time only charge) ranges from 1/4 – 1 month’s rent, depending on the length of the home share contract:
| TERM LENGTH | ONE TIME ONLY HOST SERVICE FEE |
|---|---|
| 1 -3 months | 1/4 month’s rent |
| 4 – 5 months | 1/2 month’s rent |
| 6 – 9 months | 3/4 month’s rent |
| 10 – 12 months | 1 month’s rent |
(There are no service fees for housemates).
The benefits for the host, according to Singer, include:
- Earning up to $1,200 extra income each month to cover rising living costs.
- Enjoying the companionship of a like-minded housemate.
- Reducing your mortgage payment and the burden and stress of home maintenance.
- Playing an important role in easing Canada’s housing crisis.
- Helping newcomers and international students settle in their new country.
“Sparrow is very reliable and handles any concerns with expertise and professionalism,” said home share host Alma Ramos.
“I currently have a housemate, and because it was a perfect match, we live (under) one roof harmoniously.”
Here’s how to become a newcomer host
Canadian homeowners with a spare bedroom can sign up to be a home-sharing host here.
“We’re on a mission,” says Frattini, “to help newcomers enter the rental market faster and easier by connecting them with newcomer homeowners and allies who can provide safe and affordable housing.”
“We look forward to reaching out to any and all homeowners across the country who want to contribute to building this innovative housing solution for newcomers.”
*No Chat GPT was used in the writing of this story, and all sources are cited and credited where possible
