Over the last 12 years, house prices in Canada have increased dramatically. If you are one of the fortunate long time homeowners nearing retirement, you are sitting on a gold mine, and the equity in your home may far surpass your retirement nest egg.
Whether you’re planning on selling or staying in your current home, here are a few ways you can tap into your home equity to help the cash keep flowing in, during your retirement:
Sell your home and rent an apartment.
You can sell your home and invest the proceeds into instruments such as annuities, giving you a boost on your monthly income. This will enable you to enjoy a retirement lifestyle that you would otherwise be unaffordable.
You would be required to rent a home instead of own a home, and this may not bode well with some people. However, renting does offer flexibility, especially if you decide to spend time away from home.
Downsize your existing home.
If you are not comfortable with renting, then you have the option of selling your home and buying a smaller condo or apartment. This will simplify your lifestyle, as owning such a property requires much less effort and expense.
Besides, you can use the residual to invest in financial instruments that will supplement your retirement portfolio.
Rent out your home.
Renting out your home is a viable option that will allow you to travel for extended periods of time. You can use the proceeds of the rent to give you the extra income to pay for your accommodation, daily living and travel expenses. There is a large market for short-term rentals, which command a high premium, especially if you provide furniture, linen, utensils etc.
Convert your home and become a landlord.
If you own a larger home, why not convert your basement or part of your home into a suite and rent it out? This will enable you to generate some additional income every month. It would require you to spend money on renovation and educate yourself on how to be a landlord.
Get a reverse mortgage
Another option is using your home equity to get cash through a reverse mortgage. You don’t have to pay back this loan until you sell your home. In most cases, you can borrow between 10% and 40% of your home’s value.
A reverse mortgage depends on what your home is worth, your age and interest rates. You must pay off any other loans on your home, including any unpaid mortgage.
There are pros and cons to do this so make sure you get the right advice before you proceed.
Your retirement is your reward for living a fulfilling life. If you are fortunate enough to own your home when you retire, you have many options open to you to help you retire comfortably.
If you need the right kind of assistance and advice in making such an important decision, you can discuss your options with our real estate advisors. Call us on 604 913 1000 or email us.
How Your Home Can Help You During Your Retirement.
Over the last 12 years, house prices in Canada have increased dramatically. If you are one of the fortunate long time homeowners nearing retirement, you are sitting on a gold mine, and the equity in your home may far surpass your retirement nest egg.
Whether you’re planning on selling or staying in your current home, here are a few ways you can tap into your home equity to help the cash keep flowing in, during your retirement:
Sell your home and rent an apartment.
You can sell your home and invest the proceeds into instruments such as annuities, giving you a boost on your monthly income. This will enable you to enjoy a retirement lifestyle that you would otherwise be unaffordable.
You would be required to rent a home instead of own a home, and this may not bode well with some people. However, renting does offer flexibility, especially if you decide to spend time away from home.
Downsize your existing home.
If you are not comfortable with renting, then you have the option of selling your home and buying a smaller condo or apartment. This will simplify your lifestyle, as owning such a property requires much less effort and expense.
Besides, you can use the residual to invest in financial instruments that will supplement your retirement portfolio.
Rent out your home.
Renting out your home is a viable option that will allow you to travel for extended periods of time. You can use the proceeds of the rent to give you the extra income to pay for your accommodation, daily living and travel expenses. There is a large market for short-term rentals, which command a high premium, especially if you provide furniture, linen, utensils etc.
Convert your home and become a landlord.
If you own a larger home, why not convert your basement or part of your home into a suite and rent it out? This will enable you to generate some additional income every month. It would require you to spend money on renovation and educate yourself on how to be a landlord.
Get a reverse mortgage
Another option is using your home equity to get cash through a reverse mortgage. You don’t have to pay back this loan until you sell your home. In most cases, you can borrow between 10% and 40% of your home’s value.
A reverse mortgage depends on what your home is worth, your age and interest rates. You must pay off any other loans on your home, including any unpaid mortgage.
There are pros and cons to do this so make sure you get the right advice before you proceed.
Your retirement is your reward for living a fulfilling life. If you are fortunate enough to own your home when you retire, you have many options open to you to help you retire comfortably.
If you need the right kind of assistance and advice in making such an important decision, you can discuss your options with our real estate advisors. Call us on 604 913 1000 or email us.