Owner · Strategy
Coquitlam owners with significant equity often face the question: extract via refinancing or sell and move on? The answer depends on tax, lifestyle goals, and the specific math of your property. Here's the framework.
Verified · Owner · Strategy
Sell — Pros
Capital gains tax-free if principal residence. Net proceeds in cash. Move on to different lifestyle, downsize, relocate. Eliminates property risk.
Sell — Cons
Closing costs (legal + commission + adjustments). Property Transfer Tax on next purchase. Capital appreciation foregone if market continues to rise. Housing-gap risk.
Refinance — Pros
Stay in the home and lifestyle you've built. Access equity without triggering tax (refinance proceeds are not taxable). Continue any future appreciation.
Refinance — Cons
Mortgage interest cost on the refinanced amount. Stress test must be passed at higher loan amount. Lender appraisal required. Some refinance scenarios trigger CMHC insurance.
Tax position
Principal residence sale is generally capital-gains-tax-free in Canada. Refinance proceeds are not income. Both are tax-favorable for owner-occupiers — different mechanics.
Stress test for refinance
Federal stress test still applies on refinance. Qualifying rate is the higher of the contract rate + 2% or the OSFI benchmark. Make sure you can pass at higher loan amount before counting on refinance.
LTV constraints
Refinance LTV in Canada typically capped at 80% of appraised value (no insured refinance available since 2016).
When sell wins
If you no longer use the home, lifestyle has fundamentally changed (job move, kids gone), or you're hitting retirement and want to deleverage.
When refinance wins
If you still love the home, want to access equity for renovation/investment/business, and the long-term appreciation outlook is positive.
No pressure. No obligation. Just a 30-minute call to talk through your specific situation.