Many people hyphenate the term cohousing, but the spelling used by the Canadian Cohousing Network, the Cohousing Association of America, the UK Cohousing Network, and Cohousing Australia is without the hyphen.
Cohousing is a type of collaborative housing that attempts to overcome the alienation of modern housing, where there is little sense of community and few people know their neighbours. Cohousing communities incorporate the following main features.
Participatory Process
The future residents are integral to the planning, design and development of the community, so that it directly responds to their needs.
Private Dwellings Supplemented by Common Facilities
Cohousing combines the autonomy of compact self contained private dwellings with the benefits of shared, spacious community amenities that typically include a large dining room, kitchen, recreation spaces, meeting rooms, children’s play spaces, guest rooms, workshops and gardens. Although many multi-family developments include some amenity spaces, in cohousing the extensive common spaces not only make it possible to live in a smaller home, they also function as the heart of the community and offer many opportunities for social interaction. Although each home has its own private kitchen, shared meals are one of the many regular events that support relationships among neighbours.
Neighbourhood Design
The physical design provides opportunities for spontaneous connection as well as maintaining the option for privacy. This can be achieved with a variety of building forms. Completed communities vary in size, but typically range from 20 to 30 homes. Some have a special focus (e.g., for seniors) but most are intergenerational with a mix of family types and ages. Building forms mirror the range found in the larger society: single-family, townhouses, duplexes and apartments. Cohousing neighbourhoods typically incorporate environmentally sensitive design with a pedestrian orientation and have documented lower vehicle use than conventional neighbourhoods.
Community Governance
Community decision making is non-hierarchical and usually by consensus, however this does not impact the ownership form. Cohousing is not a particular legal form or means of holding interest in real property. The legal ownership form generally chosen for the completed community is the strata/condominium, however some communities have chosen to use the co-op/share structure. Regardless of the legal structure chosen, the community is ultimately bound by the rules and laws set out by the provincial acts governing stratas/condominiums or co-ops/share structures.
The development process does not of itself generate below market priced homes. Although that process does not include profit if the resident group is the developer, the homes are often of higher quality with more green-built features then conventional housing. This makes them less costly to maintain and operate, but does contribute to higher construction costs.
An aspect not often considered when looking at affordability is the cost of living. Because of the social structure and easy access to shared resources, cohousing homes provide opportunities for reducing living costs that are not available in conventional neighbourhoods. The homes can be smaller without negatively impacting lifestyle and the sharing reduces consumption. As a result, cohousing contributes to the affordable housing continuum.
When Cohousing Messaging Conflicts with Financing Reality
Cohousing is gaining popularity across Canada. People value community, shared spaces, and social connection. Yet, as the model grows, an unintended obstacle is emerging: the way some cohousing groups describe their communities—on public websites, in real estate listings, or when presenting projects to lenders—can make mortgage financing, when required, more difficult.
Many cohousing communities unintentionally blur the distinction between cohousing as a social model and the legal structure used to implement it. Cohousing is fundamentally a community and lifestyle model centered on neighbour interaction, shared spaces, and collaborative governance. The underlying ownership structure—whether condominium/strata, cooperative, rental, fractional interest, co-ownership, or another arrangement—is governed by provincial legislation and comes with its own legal, financial, and regulatory requirements.
When these two concepts are conflated, it can create confusion for lenders, insurers, municipalities, and prospective buyers about the rights, obligations, protections, and financing rules that actually apply to the project.
Cohousing Is Not a Legal Form of Ownership
A key source of confusion is that cohousing is not a legal form of ownership. In Canada, most cohousing communities are structured using conventional ownership models—typically condominiums (strata) and occasionally housing co-operatives. These are legal frameworks defined by provincial legislation that determine how property is owned, transferred, and governed. Cohousing, by contrast, is a community and lifestyle model. It describes how residents choose to organize shared spaces and social activities, but it does not determine how the property itself is legally owned or governed. For lenders, the legal structure is what matters. When a property is a condominium or strata development, ownership rights and decision-making processes are defined and regulated by provincial legislation. Units can be freely bought and sold on the open market and governance operates within a legal framework that communities cannot override. This predictability is what makes strata/condo properties relatively straightforward to finance across Canada. Problems arise when the way cohousing communities describe themselves suggests something different.
Comparing Cohousing to Co-ops or Condos
A main source of confusion occurs when cohousing is described as something that compares to a co-op or a condominium. This comparison is usually intended to explain the collaborative culture of cohousing. However, it can unintentionally blur an important distinction. Housing co-operatives and condominiums are legal ownership structures. Cohousing is not. When cohousing is described as being “similar to a co-op” or “somewhere between a co-op and a condo,” lenders and appraisers may question whether the property operates the way it is titled. Because co-ops are financed one way—and strata/condos are financed in a different way—this comparison can raise unnecessary concerns. A clearer way to describe cohousing is as a community-oriented lifestyle that exists within an established legal ownership structure, most commonly a condominium or strata development.
Messaging that suggests the community operates outside of their legal structure
Communities will also sometimes accidentally make claims that cannot be legally enforced within a condo or strata structure. For example, implying that potential buyers must be vetted by the community though filling out an application form, or the requirement to attend a community meeting prior to making an offer, raises questions about whether the community may be operating outside the boundaries of provincial condominium legislation. Implying that the community controls resales through coordinating sales, playing a role in how the units are marketed (including features sheets that can appear like the cohousing community is managing the sale—i.e. including “contact info@communityname.ca to find out more” on the feature sheet) can signal possible restrictions on resale or unclear authority over property rights. For lenders, this increases perceived risk, and can also raise questions about whether the community may be operating outside the boundaries of provincial condominium legislation.
Implying or requiring participation.
Cohousing communities understandably emphasize participation: shared meals, committees, work days, and collaborative governance are central to the culture. However, describing or implying participation as mandatory can create legal and financing concerns in strata or condominium developments. From a lender’s perspective, mandatory participation raises several questions: What happens if an owner refuses to participate? Are fines or penalties imposed? Could disputes escalate into legal conflicts affecting the property? Even if these risks never materialize, the appearance of non-standard governance structures can complicate underwriting and, in fact, most lenders will just walk away rather than dealing with this uncertainty. Encouraging participation as part of the culture of the community is very different from presenting it as a formal or implied requirement.
Seeking affordable housing options while operating as Market housing
Some cohousing projects also present themselves as affordable housing initiatives while simultaneously operating as market ownership housing. There are cohousing communities that successfully include affordable housing components. In these cases, affordability programs are clearly defined, with specific mechanisms for eligibility, administration, and long-term affordability. Confusion arises when communities present themselves as market ownership housing while seeking affordable housing subsidies or special treatment without mechanisms to preserve affordability.
Why Lenders Pay Attention to These Details
Mortgage lending is fundamentally about risk management. When lenders evaluate a property, they consider: the legal structure of ownership, the ability to resell the property, the predictability of governance, and potential barriers to liquidation. Anything that suggests restricted resale, unclear authority, or unconventional governance increases perceived risk. Even small ambiguities can matter. A lender does not need proof that a problem exists—the possibility is often enough.
Cohousing offers something many Canadians are increasingly seeking: connection, shared resources, and a stronger sense of community. But for the model to grow, it must remain compatible with the systems that finance housing. The good news is that cohousing does not need to change its values to achieve this. We simply need to ensure that how communities describe themselves publicly aligns with how they are legally structured. When messaging is clear, lenders can focus on what actually matters—the stability of the legal framework—allowing cohousing to expand without unnecessary financial barriers.
By Lysa Dixon