September 22, 2025
Across Calgary and much of Canada, thousands of homeowners find themselves in a strange new position: sitting on record home equity but struggling with monthly payments. After years of rapid appreciation and now higher mortgage rates, many Canadians are what experts call “equity rich, cash poor.” They own valuable properties on paper, yet rising renewal rates, property taxes, and utility costs are stretching their cash flow thin. According to Statistics Canada, household debt remains near 180% of disposable income, while over 60% of mortgages will renew by the end of 2026—many at rates two or three percentage points higher than before. For many families, it’s not about qualifying anymore—it’s about staying comfortable.
In Calgary, this issue is especially visible among homeowners who bought or refinanced between 2020 and 2022 at record-low rates. Those same borrowers are now seeing renewals near 5.5% or higher, with payment increases averaging $500 to $900 per month. Even with strong equity, that kind of jump can strain budgets. The challenge is psychological as much as financial: people hesitate to touch their equity, yet letting rising interest eat into savings can be even riskier. This is where smart mortgage restructuring—not just rate hunting—can make the difference between short-term stress and long-term stability.
Refinancing to extend amortization, switch from variable to fixed, or consolidate high-interest debt can turn equity into a tool for financial resilience. However, using home equity should be strategic, not reactive. Borrowers should evaluate whether tapping into equity will actually reduce total interest costs or simply delay repayment. Working with a broker allows homeowners to model various “what if” scenarios: What if rates drop next year? What if I accelerate payments after refinancing? What if I consolidate my credit cards at 22% into a 5% mortgage? Understanding these trade-offs is key to converting equity into flexibility rather than additional risk.
The takeaway for 2025 is simple: don’t let home equity sit idle while your budget suffocates. If your mortgage renewal is approaching, start by reviewing your total debt picture—mortgage, credit cards, vehicle loans, and lines of credit. Equity is not just a number on paper; it’s leverage that can stabilize your household finances when used wisely. Calgary homeowners who proactively adjust now will be better positioned for whatever comes next—whether rates fall, plateau, or climb again in 2026.
Source: Absolute Mortgage Team