Divided or Undivided Co-ownership: What Are You Really Buying?

Summary

• A lot of your own, or a percentage of the building
• The down payment goes from 5% to 20%
• In undivided co-ownership, the tax bill is shared, and so are defaults
• Reselling an undivided share: a one-year window to know about
• A chalet bought by two families is also undivided co-ownership
• Four differences to compare between two listings
• Five documents to read before signing a promise to purchase
• Divided or undivided co-ownership: the choice comes down to cash
• FAQ

Key takeaways: With divided or undivided co-ownership, you are not buying the same thing. In divided co-ownership, you alone own your unit, with its own lot and its own tax bill. In undivided co-ownership, you hold a percentage of the entire building. The difference shows first in the cash required: a 5% minimum down payment on one side, 20% on the other.

The duplex in Saint-Jérôme you are visiting with a couple of friends, the chalet in Morin-Heights you will share with your sister, the condo at the foot of the Tremblant slopes: on the listing, the co-ownership is described as divided or undivided, and that one word changes what you are buying.

In undivided co-ownership, you are not buying a unit, but a fraction of the building with the right to occupy part of it. That word decides whether you bring $22,500 or $90,000 to a $450,000 unit, whether the tax bill is yours or the building’s, and whether another owner can buy back your share for a year.

A lot of your own, or a percentage of the building

In short: In divided co-ownership, each unit is a separate property; in undivided co-ownership, there is only one property, shared in percentages.

Divided co-ownership is the condo as most people picture it: private portions, your unit and sometimes a parking space, and common portions such as the roof or the land. Each private portion receives its own lot number in the cadastre and becomes property that you alone own.

Undivided co-ownership works differently. According to the OACIQ professional practice guide on undivided co-ownership, none of the owners holds a private portion: they all own a percentage of the entire building and an exclusive right to use their unit.

Divided co-ownership only comes into being with a notarized declaration of co-ownership published in the Land Register. Undivided co-ownership arises without any formality as soon as two people buy together. A unit with its own lot number is therefore held in divided co-ownership.

The down payment goes from 5% to 20%

In short: For the same price, undivided co-ownership requires four times more cash, because a loan on a share of a building cannot be insured.

For a divided condo, the minimum down payment is 5%, provided the mortgage loan is insured. For undivided co-ownership, National Bank sets the minimum down payment at 20% and requires the loan to be obtained from the same institution as the other co-owners.

On a unit listed at $450,000, 5% represents $22,500, plus the mortgage loan insurance premium added to the mortgage. At 20%, you need $90,000 in cash: that $67,500 gap often decides on its own which type of co-ownership is within reach.

The explanation lies in insurance. A loan that only covers your share is insured by neither CMHC nor Sagen, according to a La Presse investigation into undivided purchases (in French) published in February 2024; only Desjardins and National Bank offered this financing in Quebec at the time. In 2025, both reported a drop in applications, according to the Regroupement des gestionnaires et copropriétaires du Québec (in French) (RGCQ). Have the conditions confirmed before submitting a promise to purchase, and compare them with fixed and variable rates in 2026.

When the listing does not specify the type of co-ownership, a broker who represents buyers can check the Land Register to see whether the unit has its own lot.

In undivided co-ownership, the tax bill is shared, and so are defaults

In short: When an undivided co-owner does not pay their share of taxes or expenses, the others have to cover the shortfall.

An undivided building has only one lot, and therefore a single municipal and school tax bill, shared according to each owner’s share. National Bank draws the obvious conclusion: if one of the co-owners cannot pay their share, the others must pay for them.

Take a triplex in Saint-Jérôme held in equal shares by three owner-occupants, with a tax bill of $7,200 per year: each one budgets $2,400. If one of the three stops paying, the other two each advance $3,600 to avoid a default on the entire building. The amounts are illustrative; the shared liability is very real.

The law imposes neither a contingency fund nor a maintenance log on undivided co-ownership, the RGCQ points out: only a well-drafted agreement fills that gap. In divided co-ownership, buyers have been better equipped since August 14, 2025: the seller must give them the syndicate’s certificate on the condition of the co-ownership (article 1068.1 of the Civil Code). According to the OACIQ, it shows the balance of the fund alongside the amount recommended by the study, and the major work planned over ten years, with its estimated cost.

There is nothing like it in undivided co-ownership: ask the other owners for the fund balance and upcoming work, since a roof that needs redoing is paid for in proportion to each share.

Reselling an undivided share: a one-year window to know about

In short: The other owners can buy back a share sold to a third party, which makes the purchase open to challenge for a year.

Article 1022 of the Civil Code gives the other undivided co-owners a right of redemption. As summarized in a Lavery law firm bulletin on undivided co-ownership and the right of redemption (in French), an undivided co-owner may, within 60 days of learning of a sale to a third party, buy the share back by reimbursing the price and costs. This right must be exercised within one year of the sale.

You pay the notary and the movers, then another owner reimburses you and takes your place ten months later. The bulletin describes such a title as “rather precarious.”

A right of first refusal set out in an agreement published in the Land Register rules out this redemption: the other owners decide before the share is offered to a third party. According to the OACIQ, the agreement must be renewed every 30 years.

Renting poses another limit, a decisive one for a resort condo in Mont-Tremblant bought with the idea of renting it to skiers. Both lenders ask the notary to exclude renting from the agreement, unless permitted, and do not finance a share that is rented out, according to La Presse. In divided co-ownership, the declaration of co-ownership states whether renting is allowed; for stays of 31 days or less, also check with the municipality and the CITQ.

A chalet bought by two families is also undivided co-ownership

In short: Two sisters or two couples of friends who buy a chalet together become undivided co-owners, with the same rules as a plex.

Two sisters who buy a chalet in Morin-Heights, 50% each, are undivided co-owners from the moment they sign, even if the deed never says “co-ownership.”

Who pays for the roof? Who uses the chalet over the holidays or spring break? What happens if one of them sells her half to a colleague? Without an agreement, the Civil Code says little, and the right of redemption benefits the sister who stays. The steps of a first purchase in the Laurentians also apply to buying with others.

Four differences to compare between two listings

In short: Financing, charges, resale and management all change depending on the type of co-ownership.

To compare a divided condo and an undivided share at the same price:

Five documents to read before signing a promise to purchase

In short: The building’s documents tell you more about the type of co-ownership than the listing or the visit.

Before making an offer, ask for these five documents:

• The previous deed of sale. A lot number specific to the unit confirms divided co-ownership; a single lot for the building signals undivided co-ownership.
• The declaration of co-ownership or the undivided co-ownership agreement. Once published in the Land Register, it binds future buyers; if unpublished, it offers you little protection.
• The latest tax bill. In undivided co-ownership, it covers the whole building: check the share and make sure there are no arrears.
• The status of the contingency fund. In divided co-ownership, the syndicate’s certificate gives the figure; in undivided co-ownership, ask for the statement kept by the owners.
• The resale and rental clauses. Right of first refusal, waiver of redemption, ban on renting: these lines set your future freedom.

The promise to purchase in Quebec can be made conditional on reviewing these documents.

Divided or undivided co-ownership: the choice comes down to cash

With less than 20% in cash, the question settles itself: only divided co-ownership is within reach. Beyond that, undivided co-ownership can make sense if a published agreement settles resale, expenses and the fund in advance. And nothing is set in stone: with the consent of all co-owners and the municipality, undivided co-ownership can be converted into divided co-ownership, the RGCQ notes.

Can’t find the previous deed or the agreement? A broker can obtain them from the Land Register before you submit your offer.

FAQ

Divided or undivided co-ownership: which is better for a first purchase?

Between divided and undivided co-ownership, divided comes out ahead in most cases. For a first-time buyer, everything hinges first on the down payment: 5% with an insured loan in divided co-ownership, 20% in undivided co-ownership according to National Bank, since a share cannot be insured. In divided co-ownership, buyers also choose their lender, receive the syndicate’s certificate and never pay a neighbour’s taxes.

Can you rent out a unit held in undivided co-ownership?

Rarely. Institutions that finance an undivided share ask the notary to exclude renting from the agreement, unless permitted, and do not finance a share that is rented out. In divided co-ownership, the answer is in the declaration of co-ownership, which can regulate renting: that is the document to read, not the listing. If you plan to rent one day, make this clause a condition of your promise to purchase.

What is an undivided co-ownership agreement?

It is the contract that governs life in a building held in undivided co-ownership. It sets each owner’s share, the exclusive use of units, the sharing of expenses and the resale rules. According to the OACIQ, the agreement must be renewed every 30 years and published in the Land Register to be enforceable against third parties. It is optional in law, but lenders that finance a single share make it a condition.