How to Transfer Wealth to Your Children Through Real Estate


  • Will your children and grand children be able to afford a home? Or will they be renters for life?
  • Would you like to transfer your wealth to them, tax free?
  • With the average 30 year appreciation being 6% annually, should you be looking at buying a place for your 5 year old ... now?

Once upon a time we purchased RESPs for our children's education. As tuition skyrocketed, we realized our savings would not keep pace. It cost me $3500 per year to go to university, by the time my kids go it's going to cost $100,000... each. 

A few years ago I cashed out the RESPs, paid the tax, and bought a new condo and dedicated it to their education, so that it acts as the RESP. I am renting it out so that it is paid off by my tenants, and if my kids go to school in the area they can use it as a residence.

A new condo is ideal for my situation as I don't have time to do repairs or pay bills or go and mow the lawn/shovel snow, this is covered by the maintenance fees. A property manager is on site to handle the day to day for me. And my tenants are building up the equity.

So we pretty much have the education covered... but what if they want to buy a home someday? The average salary in 1970 was $5,000 while a home cost $29,000 (5.8 X). In 2018 the average salary is $49,000, while a home costs $822,000 (16.8 X) [data from and]. With this growing gap, what will happen in 20 years when our kids want to buy a house?

Salaries/income go up about 2% per year, so in 20 years the average salary may be $73,000.

On average houses appreciate 6% per year; so in 20 years the average Toronto home will cost $2,400,000. When our children start their own families, how can they possibly afford that with expected salaries? Even if they do well and both husband and wife make $100,000 their first years, they would still only qualify for an $800,000 mortgage! Where is the other $1,600,000 going to come from?! If the trend continues, the gap gets outright scary, and it's a chance we're not willing to risk.

Therefore, in order to protect our children's ability to get into the market, while not tying up too much of our money and time, we have decided to buy easy to manage condo units for each child and get them into the market now. This way we are leveraging a small investment today as an insurance policy for them to be property owners in the future, and have a starter home which will hold its value against other properties.

The principles are this:

  • CRA allows parents to offer the downpayment to their child either as a gift, or interest free mortgage. Thus allowing them to get in the market now.
  • Buy in their name using a Trust, maintain control so they cannot access the equity, and avoid estate transfer taxes.

There are two avenues that we have explored that are ideal. The pre-construction condominium that takes 3-5 years to build, or the resale condominium.


  1. 15-25% deposit, takes 3-5 years to build.
  2. Deposit grows with the full real estate value, and no tenants during the build.
  3. Ten years of tenants paying off the mortgage.
  4. New builds have lower maintenance fees.
  5. Reputable Builders offer great incentives!


  1. 20% deposit required immediately, investment grows with tenants paying off mortgage, appreciation, and cashflow.
  2. Typically has higher maintenance fees, as building ages.

If you are interested in protecting your children's future, Take Action Now by reaching out to us  Today and discover homes that will be paid for by your tenants... so your kids can live in a house like the one below.

The journey of a thousand miles begins with a single step.

The journey of a thousand miles begins with a single step.