What To Do With a House You’ve Inherited in Alberta

Jul 8

Inheriting a home can feel like a gift — or a gut punch. For many Albertans, it brings a mix of emotions, responsibilities, and big financial questions. Whether you're in Calgary, Edmonton, Red Deer, or a small town like Lethbridge, one thing is certain: what you do next matters.

Renee Huse, founder of Spire Mortgage Team in Alberta, has helped countless families navigate the decisions that follow an inheritance. As Alberta’s best mortgage broker, she breaks down the options clearly — so you can move forward with confidence and strategy.

What We’ll Cover:

Understand Your Options
Mortgage & Tax Considerations in Alberta
Should You Keep It, Rent It, or Sell It?
Case Study: Inheriting a Home in Red Deer
Glossary
FAQs
Next Steps

Understand Your Options

When you inherit a house in Alberta, your first step is understanding what exactly you’ve inherited. Is the home owned free and clear? Does it carry a mortgage? Is there more than one heir involved?

Here are your core options:

Move in and make it your primary residence
Rent it out for passive income
Sell the home and use the proceeds
Refinance or take equity from the home for other goals

Each path has financial, legal, and emotional considerations.

Mortgage & Tax Considerations in Alberta

Inherited homes often come with unknowns. In Alberta, there's no inheritance tax, but there can be capital gains tax if the property is later sold for more than its value at the time of inheritance.

If the home has a mortgage, you’ll need to:

Assume the existing mortgage (if possible — lender approval is required)
Refinance into your name, often at a rate like 4.34% for conventional loans
Pay off the mortgage using proceeds from the estate or other assets

There may also be probate fees (up to $525 in Alberta) and maintenance costs to consider.

Should You Keep It, Rent It, or Sell It?

Keep & Move In

Great option if:

You need housing
You love the location
You're ready for long-term homeownership

You may want to refinance to a better rate or access equity for upgrades. Our team can help with conventional mortgage options starting at 4.34% on a 5-year fixed.

Rent It Out

Smart if:

You want cash flow
You're not ready to sell
The home is in a rentable area like Edmonton or Grande Prairie

Sell the Property

A good move when:

You don’t want to manage the home
Other heirs are involved
You’d rather invest elsewhere

Case Study: Inheriting a Home in Red Deer

Sandra, 46, from Red Deer, inherited her mother’s 1,200 sq ft bungalow. It had $140,000 left on a mortgage at 3.49%. She was emotionally attached but also burdened — her own mortgage in Calgary made holding two homes tough.

The Strategy:

Sandra wanted to keep the home as a rental but needed updates and a plan for the mortgage.

We helped her:

Refinance the Red Deer property at 4.34% (conventional 5-year fixed)
Unlock $50,000 in equity for kitchen and bathroom upgrades
Set up bi-weekly accelerated payments with prepayment privileges

She found local renters quickly, charging $1,750/month. After mortgage, taxes, and insurance, she netted $320/month. Now, the property is not just a legacy — it’s a wealth-building tool.

Glossary

Inheritance – Property or assets passed to you after someone dies.
Probate – The legal process of validating a will in Alberta.
Capital Gains Tax – Tax on the increase in value of a property when sold.
Mortgage Assumption – Taking over the existing mortgage with lender approval.
Conventional Mortgage – A mortgage with 20%+ down or for refinances (currently ~4.34%).
Insured Mortgage – For purchases with under 20% down (currently ~3.99%).
Refinance – Replacing an existing mortgage with a new one, often to access equity.
Equity – The difference between the property’s value and what’s owed on it.
Rental Income – Money earned from renting out a property.
Estate – All assets and debts left by a deceased person.

FAQs

What happens to the mortgage when you inherit a house in Alberta?

You may need to assume it or refinance it. The lender will not automatically let you take it over — approval is required.

Do I pay taxes when I inherit a house in Alberta?

There’s no inheritance tax, but capital gains may apply if you sell later for more than the inherited value.

Can I refinance an inherited home in Alberta?

Yes. If the property is transferred into your name and you qualify, you can refinance to access equity or secure a better rate.

Is it better to rent or sell an inherited home?

It depends on your goals, the condition of the home, and the local market. Renting can provide long-term cash flow, while selling provides an upfront payout.

What if I inherited a house with siblings?

You’ll need legal clarity. Options include buying them out, co-owning as a rental, or selling and splitting proceeds.

Next Steps

Inheriting a home is more than a transaction — it's a turning point. Whether it becomes your next home, a rental, or the seed for your next purchase, the right mortgage strategy makes all the difference.

Give us a call or fill out an application at this link: https://spiremortgage.ca/apply-now and our team will get in touch with you to start building a plan that suits you.

Renee Huse