The Carrying Cost Crisis Facing Canadian Homeowners

While home prices across the country have dropped from their early 2022 heights, the carrying costs of homeownership have only continued their decade-long climb. The average Canadian homeowner spends nearly $28,000 per year on home-related costs, jumping to almost $39,000 for those with a mortgage.¹ That’s 50-100% more than homeowners spent just 10 years earlier.²

If you’re on a fixed income or just have less capacity to absorb these increases, tapping into your home equity through a Home Equity Sharing Agreement offers a practical way to soften the impact of higher homeownership costs and stay in your home for longer.

The Rising Cost of Homeownership

Ballooning homeownership expenses, coupled with a higher overall cost of living, are stretching the monthly budget for many homeowners, and in particular retirees on fixed incomes. Those expenses include: 

Mortgage Renewals: Renewing at higher interest rates has added hundreds of dollars to homeowners’ mortgage payments. Average monthly payments on new mortgages rose from $1,500 in 2020 to $2,000 in 2025 across Canada, reaching over $3,000 in major urban centres, according to the Canada Mortgage and Housing Corporation.³

Property Taxes: Higher municipal budget demands and updated property assessments have pushed tax bills up nationwide.

Insurance Rates: Home insurance premiums surged 45% between 2019 and 2025, driven by higher rebuild costs and catastrophic weather claims that hit $8.6 billion in 2024 alone.⁴

Maintenance & Labour: Nearly one in four Canadian homes is in need of at least minor repairs, such as defective steps and loose floor tiles or shingles, and just over 7% require major repairs to address issues such as defective plumbing, electrical wiring or structural issues.⁵ But renovations and repair costs jumped 21% over the last decade, with contractor fees up an average of 55% across standard residential projects.

Facing higher fixed costs could force you to contemplate unwelcome financial tradeoffs, such as putting off saving for retirement or cutting back on lifestyle expenses and experiences you enjoy.

How to Reduce Your Monthly Carrying Costs

If you’re feeling the pinch every month, there are a few levers you might be able to pull:

Property tax deferment programs: Some cities across the country have property tax deferral or cancellation programs, typically for low-income seniors who own their homes. For example:

• Toronto allows low-income seniors to defer their property taxes or cancel the annual tax increase portion;
• Ottawa allows eligible low-income seniors and residents with disabilities to defer their annual property taxes and water bills;
• Halton Region has a 100% interest free property tax deferral for low-income seniors who’ve owned and lived in their home for at least four years; and
• British Columbia and Alberta also have tax deferral programs.

Climate-resilient renovations: Making resiliency upgrades could save you money on insurance premiums in addition to protecting your home from extreme weather. Some insurers have started to incentivize people to invest in upgrades like installing a sump pump, backwater valve, hail-resistant shingles and surge protectors, by reducing premiums or reimbursing a portion of the cost.⁶ Some provinces and municipalities also have rebate programs for certain climate resiliency measures.⁷ A recent Institute for Catastrophic Loss Reduction study noted that these upgrades aren’t prohibitively expensive (typically $3,000 to $10,000) and increase the home’s value when sold.⁸

Home renovation rebates: All provinces and territories have some rebates for energy-efficient home renovations such as window and door replacements, insulation and water heater or heat pump installation. These rebates can reduce the cost of a much-needed upgrade or repair, and contribute to lower utility bills.

Tapping Your Home Equity to Manage Cost Increases

Many Canadians have most of their wealth in their homes, rather than personal savings or investment portfolios. 

Historically, accessing that equity has meant taking on secured debt, either through a HELOC or a home equity loan. These products require monthly payments and, when your fixed costs are already creating financial strain, a new monthly debt payment may not be feasible.

Clay Financial’s Home Equity Sharing Agreement is a modern alternative to tap into your home equity without taking on new debt or making monthly payments.

If you have over 25% equity in your home,⁹ Clay provides a tax-free, lump-sum payment of up to 17.5% of the appraised value of your home (up to a maximum of $500,000). You can use these funds for any purpose, including paying for essential repairs, building an emergency cushion of savings, or covering daily living costs.

In exchange, you make a payment at the end of the HESA based on your home’s change in value since the beginning of the contract. If your home appreciates, we share in a percentage of that gain. If it depreciates, we’ll even share in that loss when you sell,¹⁰ meaning your payment to Clay at the end of the HESA could be less than Clay’s original payment to you at the beginning of the HESA. Our HESA has a flexible term up to 25 years, ending either when you sell your home, buy out the agreement,¹¹ pass away or reach the 25-year mark. 

The agreement preserves the existing equity you’ve built in your home, because we only share in the future appreciation of your home. And because it’s not debt, there’s no interest accruing and no monthly payments to make. 

How Clay’s Home Improvement Adjustment Works

If you’ve been wanting to make home renovations or resiliency upgrades, you could benefit from our Home Improvement Adjustment. We allow the homeowners we work with to keep 100% of any appreciation resulting from new investments in their home that go beyond expected maintenance.

At both the beginning and the end of your HESA we conduct a fair market value appraisal of your home. If you make any improvements during the term of your HESA, you’ll follow our process to notify us about the improvements and document the changes. We’ll share those records with the appraiser at the end of the HESA and their appraisal will indicate any incremental value that the renovation added to the property versus comparable properties. 

As an example, let’s say you spend $40,000 of your HESA funds to finish your basement and, at the end of your HESA, the renovation is found to have added $24,000 to the value of your home. We would subtract that amount from the total value before we calculate our share of the appreciation.

You Invest in Your Home, Let Your Home Return the Favour

If rising ongoing expenses are straining your monthly budget, a HESA offers financial flexibility without the weight of new debt or monthly payments. 

To learn more about how much you could qualify for, get a free, no-obligation estimate from Clay Financial today.

1. See Statistics Canada’s 2023 Survey of Household Spending. ↩︎
2. Analysis by Clay Financial based on footnote 1 above and Statistics Canada’s 2013 Survey of Household Spending. ↩︎
3. See Canada Mortgage and Housing Corporation’s data on average scheduled monthly payments for new mortgage loans. ↩︎
4. See Statistics Canada’s June 2026 study on extreme weather impacts on Canadian consumers and insurers. ↩︎
5. Analysis by Statistics Canada in StatsCAN Plus based on its 2022 Canadian Housing Survey. ↩︎
6. According to Intact, green renovations and maintenance and upgrades that prevent water damage can lower your insurance premiums. As reported by the Globe and Mail, one Canadian insurer is offering clients up to $3,000 in reimbursements for weather-resistant roofing upgrades and $1,000 for preventative measures, including surge protectors. ↩︎
7. For a summary of federal, provincial and municipal resiliency rebates, see this list compiled by Rates.ca. ↩︎
8. Analysis by the Institute for Catastrophic Loss Reduction (April 2026). ↩︎
9. The total value of the HESA amount plus all debt secured against your home cannot exceed 75% of your home’s fair market value. ↩︎
10. We will share in depreciation if the property is sold, and so ending the HESA, anytime after the first five years of the HESA and the fair market value of the property is less than the starting value under the HESA. ↩︎
11. The option to buy out the HESA is available anytime after the first five years of the term with the payment amount calculated based on the property’s fair market value at the time. ↩︎