rent-versus-own

Model

House Purchase Analysis Model (v. 1.03)
Instructions for Use at http://www.dcf-models.com)
SCENARIO 1: PURCHASE HOME
Intended Purchase Date
Jan-08
Purchase Cost of Home
$200,000
Down Payment
$20,000
CMHC
Premium
CMHC Insurance
$4,500
5%
3.75%
Mortgage Value
$184,500
10%
2.50%
BC Property Purchase Tax
$0
15%
2.00%
20%
1.25%
Inspection Fees
$337
25%
0.75%
Legal Fees & Disbursements
$750
35%
0.50%
Property Survey
$350
36%
0.00%
CMHC Application Fee
$165
Other Closing Cost (Excl. Adj. For Taxes, Water, etc)
$1,602
Mortgage Rate (Semi-Annual)
6.85%
Effective Monthly Compounded Rate
6.75%
Amortization (Years)
25
Monthly Rental Income from Suite (if applicable)
$500
Annual Property Taxes
$2,000
Monthly Hydro and Gas
$177
Monthly Property Insurance
$100
Monthly Repairs and Maintenance
$100
Annual Taxes, Repairs, Heat, etc.
$6,524
SCENARIO 2: RENT HOME
Monthly Rent (Including Heat, etc.)
$1,200
OTHER INPUTS
Expected Long-Term Price Inflation
2.50%
Real Investment Return (i.e., above inflation)
3.50%
Nominal Investment Return
6.09%
Monthly Mortgage Payment
$1,275
Breakeven Month Excluding Home Equity
Feb-2028
Breakeven Month Including Home Equity
Jan-2011
Agent's commission (Assuming 3.22-100/1.15)
$4,370
Monthly
$1,275.23
Bi-Weekly
$637.61
Weekly
$318.81
Effective Bi-Weekly Rate
6.745%
Effective Weekly Rate
6.740%
SCENARIO 1
SCENARIO 1
SCENARIO 1
SCENARIO 1
SCENARIO 1
SCENARIO 1
SCENARIO 2
PAYBACK DATE
Month
Date
Mortgage Balance at 1st of Month
Payment in Month
Interest Paid in Month
Equity Acquired in Month
Monthly Taxes, Repairs, Heat, etc.
Monthly Income from Suite Rental
Monthly Rental Cost
Month
Difference in Financial Position ($Real)
Discounted Difference in Financial Position ($Real)
Cumulative Discounted Difference in Financial Position ($Real)
Excluding Equity
Including Equity
($Nominal)
($Real)
($Nominal)
($Real)
($Nominal)
($Real)
($Nominal)
($Real)
($Nominal)
($Real)
($Nominal)
($Real)
($Nominal)
($Real)
Excluding Equity
Including Equity
Excluding Equity
Including Equity
Excluding Equity
Including Equity
Feb-28
Jan-11
1
Jan-08
$184,500
$184,500
$1,275
$1,273
$1,038
$1,036
$15,737
$15,704
$544
$544