Can You Possibly Own A House?

The answer is a big YES. To find out how, call Roy now at 204 227 2560.

Your Dream Home is Just a Phone Call Away

The Best

Your dream home is just a phone call away!

Things in Life are Free

What if your rent is free? What if you get paid instead of paying rent? Flip the page to see the

hidden possibilities ...

Produced by: ROY BALACANO

Your Friendly Realtor Cell: 204-227-2560 Email: Roy@yfr.ca

SUTTON GROUP Kilkenny Real Estate 663 Stafford St. Wpg MB

Roy can help you get the mortgage financing you need to buy your home.

Office: 204 475 9130 Fax: 204 477 4361

NOT INTENDED TO SOLICIT CURRENTLY LISTED PROPERTIES

ROY BALACANO
Your Friendly Realtor Cell: 204-227-2560

Produced by:

Pay Rent or Pay Mortgage ...

Which One Is Better?
Rex the renter paid $800/mo. for an apartment totaling $52,000 (with 4% yearly increases, compounded) over a period of 5 years. He will never recover even a cent from what he paid. On the contrary, Moe bought a home with initial capital of $8,900. He paid his mortgage at $800/mo. totaling $48,000. He then sold his home after 5 years and netted $60,000. Moe effectively recovered all his mortgage payment ($48,000) and also received $12,000 as profit. As shown by the Analysis on the right, a homeowner will potentially NET $60,000, by paying $800/mo. of mortgage over 5 years and sells the home afterwards. On the contrary, a renter paying $800/mo. will loose every dollar he/she paid or approximately $52,000 in 5 years (with 4% yearly increases, compounded). Thats over $100,000 in 10 years, really!

ANALYSIS: PAYING RENT VS. PAYING HOME MORTGAGE

A tale of two friends: Rex the renter and Moe the homeowner, both paying $800/mo. for 5 Years
COMPARABLES
Home Value (Purchase Amount)

REX PAYING RENT $800 Winnipeg apartments average2 is 4% / year $52,000

0

MOE PAYING HOME MORTGAGE $177,900 (with down payment of $8,900) $169,000 Amortization=25 yrs at 3%, Term=5 yrs Conservative estimate: 6% per year, compounded (Winnipeg home average1 increase is 9.8% per year from 2006-2010) $800 Will not change in 5 years (based on mortgage term of 5-yr closed) $2,000 / year $48,000 $24,600 of $48,000 goes to loan payment Only $23,500 is lost - paid to loan interest $144,400 - Home loan balance after 5 yrs $60,200 - Home value has increased by this much $238,100

Home Loan Value Mortgage Details Home Appreciation Rate Monthly Payment Payment Increases (annual, compounded) Property Tax (net, estimated) Total Paid in 5 Years Savings From Payment Loss (non-recoverable) Loan Balance after 5Yrs Home Appreciation after 5Yrs Home Value after 5 Yrs

$52,000 is lost -

Result if home is sold after 5 years:

Home Value after 5 yrs Less Down Payment (Capital) 5% Sales Commission Other Home Expenses (estimate) Total Taxes for 5 years Mortgage Balance after 5 yrs $238,100 -$8,900 -11,900 -3,000 -10,000 -144,400
$60,000

NOW, heres the big question: If you were to pay $800/mo. (rent or mortgage) for the next 5 years, do you want to get a full refund with interest or just let the $52,000 go?
For more detailed analysis, please refer to the right of this page.

NET Proceeds (rounded)

Roy's Conclusion: If the homeowner sells the home after 5 years, the potential NET will be $60,000.

Note that this amount is $12,000 over the Total Amortization Paid in 5 Years ($48,000). Its like renting an apartment FREE for 5 years and getting paid $200/mo. as well. Want to learn more? Please call ROY now!
NOTES: 1 - Source document published by Economic Development - Winnipeg 2 - CMHC survey for Winnipeg: 2-bedroom apartment, Oct 2012 = $911/mo up from Oct 2011 = $875/mo % increase = (911-875) / 875 = 4.11% DISCLAIMER: This document is for analysis purposes only and does not represent any property in real life. Home price is controlled by different factors such as the prevailing Housing Market in your area. Results will vary depending on property location and other factors. Numbers and calculation results were rounded to simplify presentation.