Home Equity | Kyle Benzies

In finance, 'equity' is the total assets minus any liabilities associated with them. To simplify, it is a calculation to determine how much of what you 'have' is actually 'yours'. If you have purchased a home, consider your home's market value the 'asset' and the balance of your mortgage/other liens the 'liability'. The market value of your property MINUS the balance of your mortgage EQUALS your home equity. For example: The current market value of a home is $450,000. The principal balance owing is $300,000. The home equity is $150,000 ($450,000 - $300,000).

Why Should Home Equity Matter?

Home equity can benefit you financially in the future:

The market value of your home may increase, therefore increasing the amount of home equity you have

If you require funds for a large investment such as a renovation, advanced education, buying another home, or debt consolidation, home equity can help. It can commonly be used towards a Home Equity Line of Credit (HELOC), which often has the advantage of securing lower rates since you are borrowing against your home — less risk to the lender

It's a financial investment that often doubles down as a necessity. Everyone needs a home to live in, so why not ensure the money you pay is going right back into your pocket?

Considerations Regarding Home Equity

Down Payments — The size of your down payment affects how much home equity you have and how quickly it grows. It will affect the size of your mortgage, likely influencing the amortization and whether you choose a fixed or variable rate. These decisions affect how much money from each payment goes towards your outstanding principal and how much goes towards paying interest.

Risks — The market value of your property is influenced by external factors within the financial market. If the market dips you may run the risk of losing some equity upon resale. However, more often than not, many homeowners find their equity increasing due to overall higher resale values.

Renting vs. Owning — One of the well-known benefits of renting is that you aren't usually responsible for maintenance and repair costs. As an owner, if something goes wrong it's up to you to fix it. However, when you factor in the amount of money going towards your home equity with each payment, the benefits generally significantly outweigh the costs of any necessary repairs.

How Do I Start Building Home Equity?

The main requirement is clear — you must first own your own home! Entering the housing market can be a challenging, exhausting process, which is why working with a licensed mortgage broker can help you take the first steps by getting pre-approved for a mortgage.

To explore ways to begin building your home equity or chat about other mortgage solutions, reach out for a no-obligation call!

The information provided on this page is for educational purposes and should not be implicitly relied upon. Conditions may apply and information may not be 100% up to date. Contact a licensed mortgage professional for the most current conditions and program offerings.

Kyle Benzies, Licensed Mortgage Broker

I'm a licensed mortgage broker serving clients across British Columbia, Alberta, and Ontario. I work with a network of over 100 lenders — banks, credit unions, monoline, and alternative lenders — to find financing that fits each client's situation rather than a single institution's product shelf. Everything I publish here is written to explain how Canadian mortgage lending actually works, in plain language.

Published December 10, 2025

Home Equity: What It Is, Why It Matters & How to Build It

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