Your parents will often tell you of their home equity experiences where they paid $30,000 for the family home 30 years ago that is now worth more than $1,000,000. Over time almost all property will increase in value. In fact, property prices across BC have increased by up to 28% in the last year alone.

If you have been paying off your mortgage for at least two years, you may have equity in your home that you can use to invest or perhaps purchase an investment property. Equity in your own home is the difference between the value of the property if you sold it and the money still owing on your home loan.

Home Equity Success Story: How the Hot Real Estate Market Made Dreams Come True

Here is how some of our clients are taking advantage of their increased home equity, thanks to the hot real estate market in BC. While some work harder to pay off their mortgage or downsize by selling and buying a smaller home in cash while leaving some in the bank, others are using their increased home equity to purchase investment properties or starting a business venture that they’ve always dreamed of.

Let’s take our most recent success story from one of our clients Michael and Helena (we didn’t use their real names to protect their identity), purchased their condominium in downtown Vancouver, BC in 2012 for $350,000. Their recent appraisal valued their condominium at $700,000, with over $350,000 in appreciation and after paying down their mortgage over the last few years, they had built up over $400,000 in home equity in their condo.

They had always dreamed of becoming rental investors and here is how I was able to help them. They qualified to refinance their mortgage on their principal residence for up to $560,000, which allowed them to advance $160,000 from their home equity and using the $160,000 towards a down payment on an investment property. They looked into purchasing an investment property for $700,000 and put the 20% down payment, leaving their mortgage payments at $2,210 per month (approximately).

By having an investment which rents for $3,000, they were able to cover the monthly mortgage payment, property taxes, and insurance and still have a little left over each month.

More and more homeowners are looking at these options; you can have another property paid off in 25 to 30 years for your retirement home or as an investment for your kids in the future. If you have thought about doing this, please give me a call 1-604-614-6899 and I will be more than happy to run the numbers for you to see if it will make sense. Alternatively, you can see how much equity you can access by using our home equity calculator.

Share Your Inspirational Story with Others

You too can tell us your story about being an inspiration to a family member or increasing your wealth by leveraging your home equity. Whatever your story is, we would love to hear it. Please submit your success story to ajit(AT)loanbox.ca. We’re excited to read it.