In today’s real estate market
Many homeowners are wondering how to grow their wealth without having to inject additional savings. One question often comes up:
Can you buy a multi-unit property (plex) with no cash down — using only the equity accumulated in your primary home?
The answer: yes, it’s possible — under certain conditions.
What is equity?
Equity represents the portion of your property that you truly own.
In other words, it’s the difference between your home’s current market value and the remaining balance on your mortgage.
For example:
If your home is worth $600,000 and you still owe $350,000, your equity is $250,000.
This amount isn’t liquid cash, but it can be used as leverage to finance a new real estate purchase.
Using equity to buy a multi-unit property
Financial institutions often allow you to use part of this equity as a down payment for a second property such as a duplex, triplex, or fourplex.
There are two main ways to do this:
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Mortgage refinancing – You take out a new mortgage on your current home to access part of your equity.
You can usually borrow up to 80% of the market value of your home, minus the existing loan balance.
The withdrawn amount can then serve as the down payment for the plex. -
Home Equity Line of Credit (HELOC) – A more flexible option that lets you borrow against your equity as needed, without having to fully refinance your mortgage.
A concrete example
Let’s take a simple scenario:
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Current home value: $700,000
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Mortgage balance: $400,000
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Available equity: $300,000
The bank might allow you to borrow up to 80% of your home’s value — that’s $560,000.
This means you could withdraw $160,000 ($560,000 – $400,000) to invest in a plex and cover the down payment, notary fees, and possibly even part of the renovations.
Conditions to meet
Even if you don’t need liquid savings, the bank will evaluate several factors before approving your loan:
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Your borrowing capacity (income, debts, debt-to-income ratio).
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The market value and stability of your current property.
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The projected profitability of the plex (expected rental income vs. expenses).
In short, equity is a powerful lever, but it doesn’t replace solid financial health or a strong application.
Advantages of this strategy
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Little to no cash required.
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Leverage effect: your home helps you acquire a second income-generating asset.
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Wealth growth: rental income helps repay the mortgage while increasing your real estate portfolio’s value.
Risks to consider
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Higher total debt, which can impact your budget.
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The risk of a decline in property values, which could reduce your equity.
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Greater responsibility from managing tenants and property maintenance.
In conclusion
Buying a multi-unit property with no cash down, using only the equity from your primary home, is absolutely possible — and can be a powerful way to build long-term real estate wealth.
However, like any major financial decision, it requires careful analysis, along with guidance from an experienced mortgage broker and real estate broker to help you navigate each step.
For any questions regarding this article or to deepen your knowledge in the real estate field, do not hesitate to turn to your residential real estate broker, Caroline Desbiens. Caroline is at your service to support you in your real estate projects in the regions of Terrebonne, Saint-Lin-Laurentides, and Repentigny.
As a representative of the company Royal Lepage Habitations, Caroline provides her expertise and market knowledge to answer all your questions and assist you in your real estate transactions.
You can contact Caroline by phone at 514-585-2038 or by email at carolinedesbiens@royallepage.ca. To learn more about the services offered or to browse the real estate listings, visit her website at the following address: www.desbiensimmobilier.com.
Whatever the nature of your real estate project in the regions she serves, Caroline Desbiens from Royal Lepage Habitations is there to offer the necessary support. Do not wait any longer to contact her so that she can guide you according to your specific needs.
