How Canadian Families Are Using Their Equity to Help the Next Generation

Not long ago, many Canadian parents bought homes for $500,000 or less. Today, those same homes are often worth $1 million, $1.5 million, or even more.

It’s a blessing—but it also raises a powerful question, especially for families watching their adult children struggle with today’s housing market:

“How can we use this equity to help our kids?”

Over the past few months, I’ve heard from countless parents, grandparents, aunts, and uncles asking just that. They’ve seen the real estate boom benefit their generation—and they’re seeing how hard it is for the next one.

If that sounds like you, here are five ways families across Canada are using their equity to make a real difference—without compromising their own retirement or financial security.

1. Co-Signing on the Mortgage

One of the simplest ways to help is by co-signing. This doesn’t require you to hand over any money—but it does mean your income and credit history are added to your child’s mortgage application.

That added strength can help your child qualify for a better mortgage, faster—even if their income alone isn’t enough to pass the lender’s stress test.

2. Gifting Funds for the Down Payment

Another common strategy is gifting a portion of the down payment. Here’s a real-world example:

• Home price: $750,000
• Child’s down payment: $50,000
• Gift from parents: $200,000
• Total down payment: $250,000
• Mortgage required: $500,000
• Monthly payment (4.5%, 30 yrs): ~$2,533/month

Now compare that to the child buying with only $50K down:

• Mortgage: $700,000
• CMHC insurance: $28,000
• Monthly payment: ~$3,690/month

Net benefit of the gift:

• Save $28,000 in mortgage insurance
• Lower monthly payments by over $1,100

3. Combining Gifting + Co-Signing

For many families, the best results come from combining both strategies: gifting part of the down payment and co-signing the mortgage.

This approach increases both affordability and approval power—without overwhelming the next generation with debt or risk.

It’s not about spoiling them. It’s about giving them a strong start in a tough market.

4. Partnering as Co-Investors

Some families are also investing together, especially when adult children are still living at home.

For example, if a parent and child buy a duplex for $750,000:

• If the home appreciates at 6%/year, it could be worth ~$1.34M in 10 years.
• Estimated mortgage principal paid down: $88,000
• Total equity gain: ~$678,000

That’s nearly $700K of shared wealth—built during the years the child might otherwise be renting or living at home.

5. Upsizing to a Multigenerational Home

Some families are choosing to upsize into a larger home with a separate unit or basement apartment.

This setup gives the adult child privacy and independence—without rent or market pressure—and creates a flexible space for multigenerational living.

Want to Explore What’s Possible for Your Family?

Every family is different. The right approach depends on your financial goals, your child’s needs, and your comfort level with risk.

At our brokerage, we help families every day find solutions that build generational wealth without compromising retirement or financial stability.

If you’re wondering what your home equity could do for your family, let’s talk.

A quick call can reveal what’s truly possible.