Here’s What You Need To Know About Home Ownership Before You Get Married
By Timothy Matthews | November 28, 2025
with the assistance of Kirsten Deschamps (Law Student)
For many people, owning property like a house or condo is one of the biggest financial commitments they will ever make. Because ownership of an asset like this is so significant, it’s essential to understand the implications of that ownership if one spouse owns a home before marriage, both spouses live in that home as their family residence during the marriage, and then the couple separates.
Why? Special financial treatment is applied in certain situations to property that is considered a matrimonial home. A matrimonial home is defined in Section 18(1) of the Family Law Act of Ontario as “every property in which a person has an interest and that is or, if the spouses have separated, was at the time of separation ordinarily occupied by the person and his or her spouse as their family residence is their matrimonial home.” Note that in Ontario this concept applies only to spouses who are legally married.
UNDERSTANDING ASSETS BROUGHT TO A MARRIAGE
Given that a matrimonial home is often one of the most valuable assets owned by separating spouses, it is important to be aware of the financial implications of purchases or improvements relating to a matrimonial home.
Equalization refers to calculating each spouse’s assets and debts in order to equally divide the total value of net assets acquired during the marriage when a couple separates. When equalizing the property of separated spouses, each party is generally able to “deduct” the value of any net assets that each spouse owned on the date of marriage. However, a major exception to this is that if one spouse owns a property on the date of marriage that is considered a “matrimonial home” on the couple’s date of separation, that spouse will not be permitted to deduct the net value of the property as of the date of marriage.
The impact of this can be substantial. For example, a bank account held by a spouse on the date of marriage worth $100,000 would be deducted from that spouse’s net family property, effectively giving them credit for bringing that asset into the marriage. In contrast, a property held by a spouse on the date of marriage with a net value of $100,000 that is also a matrimonial home on the date of separation, would not be deducted from that spouse’s net family property, effectively giving the spouse no credit for bringing that asset into the marriage. In this example, this makes for a big difference in the treatment of these two assets – and the outcome for the spouse!
HOW GIFTS AND INHERITANCES AFFECT THE MATRIMONIAL HOME
Another important exception relates to gifts and inheritances received after a couple is married. On separation, gifts and inheritances are generally “excluded” from a spouse’s net family property, if the gift or inheritance is still owned at the time of separation, or if the gift or inheritance can be “traced” to other assets, such as a car purchased with funds received from an inheritance. Once again, a major exception to this is that these exclusions do not apply to the purchase of or improvements made towards a matrimonial home.
For example, if a spouse receives an inheritance of $100,000 during a marriage and those funds are held in a separate bank account, generally those funds will be excluded from that spouse’s net family property on separation, again effectively giving the spouse credit for the value of that asset as of the date of separation. In contrast, if the inherited funds were used during the marriage to purchase or renovate a home that is a matrimonial home at the time of separation, no exclusion would apply, and the full value of the matrimonial home would be subject to equalization. Thus, the spouse would receive no credit for the same $100,000 of inherited funds – again, leading to a very different outcome for the spouse!
CAMPS OR COTTAGES CAN BE CONSIDERED A MATRIMONIAL HOME
It is also important to be aware that it is possible to have more than one matrimonial home, and that the special treatment afforded to a matrimonial home could also apply to a camp or cottage. This would depend on whether the property in question was occupied by the couple as their “family residence.”
OPTIONS TO CONSIDER BEFORE MARRIAGE
There are options available to spouses to protect their contributions to a matrimonial home. For example, a couple could enter into a prenuptial agreement (referred to in Ontario as a “Cohabitation Agreement” or “Marriage Contract”), which could confirm that the spouses wish to address the financial contributions to a current or future matrimonial home in a different manner. This could include granting the owner of the matrimonial home a “deduction” for the value of the home as of the date of marriage, or it could provide for special treatment for improvements to a matrimonial home that come from an inheritance or gift.
Contact Henderson Family Law today to schedule an appointment if you have questions about matrimonial homes or other family law property issues.
DISCLAIMER:
This content is provided as a general informational source by Henderson Family Law, and does not constitute legal advice or opinion, or establish a lawyer-client relationship. Every situation is complex and fact-specific, and appropriate advice will vary accordingly. Do not rely on this information for legal decision-making under any circumstances. Please consult with us and obtain proper advice and strategy concerning the specifics of your particular situation.