A growing number of first-time homebuyers in Canada are turning to their parents to secure mortgages, with new data showing more than one in ten now require a co-signature to get into the housing market.The Bank of Canada said the share of first-time buyers relying on parental co-signing has climbed to 11%, nearly triple the rate seen in 2004 when it stood at just 4%.Blacklock's Reporter said analysts found most of these buyers would not qualify on their own. “The answer we find is that 74% of adult children would not have qualified for their current mortgage,” the report stated.The study said the trend reflects mounting affordability pressures, particularly in major urban centres where home prices remain out of reach for many young Canadians.In Toronto, 14% of first-time buyers relied on a parent to co-sign, while in Vancouver the figure reached 13%, making the practice especially common in the country’s most expensive housing markets.Without that support, buyers would face significantly lower purchasing power. Looking at late 2022 data, analysts estimated these buyers could have afforded homes averaging about $458,000 without parental backing.“For many families, co-signing is a choice that is not made lightly,” the report said, describing it as a practical response to soaring home prices and tighter lending conditions..However, the central bank warned the trend could pose broader financial risks. “The growing reliance on mortgage co-signing may represent an emerging vulnerability for the financial system,” it noted, pointing out that mortgages are both the largest household debt and a key asset for banks.The findings build on earlier data from Statistics Canada showing family support plays an increasingly central role in homeownership. A 2025 study found roughly one-third of homeowners under 35 received financial help from parents, including average cash gifts of $85,000.That report also highlighted a widening divide, noting Canadians born in the 1990s whose parents owned homes were twice as likely to become homeowners themselves compared to those whose parents did not.The issue has also drawn political attention. During the 2025 election campaign, the Bloc Québécois proposed allowing parents to withdraw funds tax-free from RRSPs to help their children purchase a first home, with leader Yves-François Blanchet describing the idea as a “social contract with younger generations.”
