The other alternative we check
Would you be better off just selling?
Sometimes, plainly, yes. Selling and buying something smaller frees more equity than any loan can, with no debt and nothing compounding. The catch is what it costs to do — commission, land transfer tax, legal fees, movers — and that you have to leave. This puts both paths side by side, with the cost of moving spelled out rather than glossed over.
Step 1: The home you have
Paid off either way — out of the sale if you move, out of the advance if you stay.
If you stay, this is what the reverse mortgage advances you. If you move, the sale usually frees far more than this — the tool shows how much.
Step 2: The home you'd move to
Commission is negotiable and varies by brokerage and province — set what you'd actually be charged. This is the single biggest cost of moving.
Land transfer tax on the smaller home is calculated for you: $12,000
Step 3: The assumptions
Your assumption, not our forecast. Set it to 0% to see the comparison with the cash simply sitting there.
Our read on it
On the money alone, downsizing comes out ahead.
After 15 years, moving leaves $528,433 more for your family, and puts $231,000 more in your hands today. But it costs $69,000 to execute — money that simply disappears — and it means leaving the home. The arithmetic is only half the decision.
What the move actually costs
This is the number people underestimate — it is 5.8% of your home's value, gone, before you have moved a single box.
Stay, with a reverse mortgage
Sell & buy smaller
What your family is left with, year by year
Staying is the home's value less the growing reverse balance. Moving is the smaller home plus whatever the freed-up cash grows to.
The part the arithmetic can't settle
Downsizing frees the most equity of any option — no debt, no interest, nothing compounding. When the numbers say move and you genuinely want to move, that is usually the right answer and we will say so. But the numbers cannot price the neighbours, the garden, the stairs you can still manage, or being ten minutes from your grandchildren. A reverse mortgage exists for people who have run these numbers and still want to stay. Both are legitimate; only you can weigh the second half.
Estimates, not guarantees. The 55% reverse-mortgage ceiling is the regulator's published maximum (Financial Consumer Agency of Canada); your actual limit depends on age, property, location and lender and is always lower. Land transfer tax is computed from the published provincial schedules — British Columbia's Property Transfer Tax, Ontario's Land Transfer Tax plus Toronto's municipal tax where it applies, and Alberta's land-title registration fees. Commission, legal costs, moving costs and the investment return are all your inputs, not our forecasts. Selling a home has tax consequences we do not model here — your principal residence is normally exempt from capital gains tax, but confirm your own situation with an accountant.
The 55% reverse-mortgage ceiling comes from the Financial Consumer Agency of Canada, checked on August 4, 2026 — the same page that tells consumers to compare "selling your home and buying a smaller home" before taking a reverse mortgage. Land transfer tax is computed from published provincial schedules by the same engine that powers the land-transfer calculators on mortgageguru.ca, which carries its own unit tests. The reverse side of the comparison is asserted to match our projection calculator to the dollar, so the two can never disagree.
Downsizing glossary
- Land transfer tax
- A provincial tax paid by the BUYER on the purchase price when a property changes hands. British Columbia and Ontario both charge one, and a purchase inside the City of Toronto pays a second municipal tax on top. Alberta charges no land transfer tax at all — only a small land-title registration fee, which makes downsizing materially cheaper there.
- Realtor commission
- The largest single cost of selling, charged as a percentage of the sale price and split between the listing and buying brokerages. It is negotiable and varies by brokerage and province, which is why this calculator asks you for it rather than assuming a rate.
- Net sale proceeds
- What actually reaches you from a sale: the price, less commission, less legal and preparation costs, less whatever is still owing on your mortgage. It is always meaningfully less than the sale price.
- Principal residence exemption
- In Canada the gain on the home you live in is normally exempt from capital gains tax when you sell it. This calculator assumes that exemption applies and models no tax on the sale — confirm your own situation with an accountant, particularly if the property was ever rented or used for business.
- Ageing in place
- Staying in your own home as you get older rather than moving to smaller housing or assisted living. It is the reason reverse mortgages exist, and the thing this calculator deliberately cannot put a price on.
Run both properly, on your actual numbers.
We'll price the reverse mortgage, and we'll be honest about what your home would really net if you sold it. If moving is the better answer, we'll tell you that — it's not the outcome that pays us, but it's the one that's right.
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