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Home prices in Guelph are hitting new highs. Is this good if you’re NOT selling?

Why now might be the right time to consider a reverse mortgage
David Pipe_October Spotlight Title Image_Reverse Mortgage

As home prices continue to rise in Guelph, many will wonder, is there any good news for those who aren’t planning to sell their home?

For most of us, our home is our biggest asset. And for those who enter retirement and sources of income change, using home equity that has been built up can make a difference in lifestyle or the ability to give to family.

Is now the time to consider a reverse mortgage?

“A reverse mortgage might be something to think about for those who have paid off their mortgage and are now looking for smart ways to access their existing wealth,” says David Pipe, Mortgage Broker, WealthTrack. 

Several lenders are offering reverse mortgages today. The options have improved, and demand for Canadian reverse mortgages has grown. “This means that you have more choices today about how you access your equity, tax-free,” explains Pipe. “It also helps to know that you never have to make payments as long as you or your spouse lives in the home. You continue to be the homeowner and have full control if you ever wanted to move or sell. Like any mortgage, prepayment penalties can apply in that case.”

But it’s not for everyone. 

The amount you can receive depends on your age, and all borrowers must be 55 years of age or older to apply. The house must be your primary residence, and not all small communities are eligible. Pipe says urban centres like Guelph, Kitchener, Waterloo, or Cambridge are perfect.  Mobile homes and farms are not eligible for a reverse mortgage. Finally, your house must be valued at $250,000 or more to be eligible.

While there are some criteria that not everyone will meet, a reverse mortgage can be a great option if you are looking for an additional source of income. “You can choose to receive payments monthly or choose to take payments as you need them,” adds the Guelph mortgage broker. “Besides that, pricing is similar to a regular mortgage. It depends on the term and whether you choose variable or fixed rates. Today’s reverse mortgage rates are in the range of 3.5% to 4.5%. Your credit score also does not impact the reverse mortgage rates.” 

As far as other costs go, you should expect to pay one-time costs somewhere between $2500-$3000 to cover an appraisal, closing costs and legal fees. Like any mortgage product, closing costs are an essential thing to know about in advance.

Many Canadians are now in retirement and want to enjoy time together, update their home, or help out younger family members. It is nice to know that a reverse mortgage is an option that can keep you covered. The other thing is that even if your house value goes down, you will never owe more than the fair market value of your home. This peace of mind is nice to have when real estate prices have been more volatile than ever.

If you want to learn more about how to access the equity that is built up in your home, or you have more questions about the upside and downside of a reverse mortgage, contact David Pipe or visit