Appendix A: Tabular Computations Using MS Excel

Financial Input:

Asking Sales Price 620,000

Purchase Price 600,000

Downpayment (20% of the purchase price) 120,000

Total Deed Transfer Tax (1.5% local and 1.5 provincial deed transfer tax) 18,000
Closing Fees 2,000
Total Due Upon Purchase 140,000

1. Monthly Mortage Payment

Actual Mortgage (80% of the purchase price) 480,000

Nominal Rate 4%
Mortgage Term 10
Amortization Period 25
Payment Frequency 12
Total Number of Payments 300
Effective Rate 0.00330589

Monthly Mortgage Payment 2,524.90

2. Monthly Payment if the New Unit is Purchased

Monthly Condo Fees 1,055.00

Monthly Property Taxes 300.00
Repairs and Maintenance 50.00
Monthly Mortgage Payment 2,524.90
Monthly Payment 3,929.90

3. Monthly Opportunity Cost

Total Due Upon Purchase*Effective Monthly Rate 462.82

4. Net Payments

Monthly Payment 3,930

Current Rent 3,000
Net Additional Payment 930
Monthly Opportunity Cost 463
Net Monthly Cash Flow 1,392.72

5. Outstanding Principal
After 2 years
23
Months Paid 24
Months Outstanding 276
Principal Outstanding 456,609.2936

6. Determining the Net Future Gain or Loss After 2, 5, and 10 Years

(a) Condo price remains unchanged

2 years
Selling Price 600,000.00
Realtor Fees
30,000.00
(5%)
Other
2,000.00
Closing Fees
Outstanding
456,609.29
Principal
Net
111,390.71
Proceeds

Funds at
140,000.00
Closing
Opportunity
Cost of Extra 34,727.42
Payments

Net Future
- 63,336.71
Value
Present
Value of - 58,513.33
Future Net
 3 2 2

Annual Price Increase 1st year

2nd year
3rd year
4th year
5th year
6th year
7th year
8th year
After 5 years After 10 years 9th year
20 15 10th year
60 120
240 180
 417,858.7903 342,109.0039

(b) 10% Drop in 2 years, back to original price by the end of

(a) Condo price remains unchanged 5 years, 10% increase by 10 years (c) Annual price increase of 2%

5 years 10 years 2 years 5 years 10 years 2 years 5 years

600,000.00 600,000.00 540,000.00 600,000.00 660,000.00 624,240.00 662,448.48

30,000.00 30,000.00 27,000.00 30,000.00 33,000.00 31,212.00 33,122.42

2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00

417,858.79 342,109.00 456,609.29 417,858.79 342,109.00 456,609.29 417,858.79

150,141.21 225,891.00 54,390.71 150,141.21 282,891.00 134,418.71 209,467.27

140,000.00 140,000.00 140,000.00 140,000.00 140,000.00 140,000.00 140,000.00

92,259.03 204,722.27 34,727.42 92,259.03 204,722.27 34,727.42 92,259.03

- 82,117.82 - 118,831.27 - 120,336.71 - 82,117.82 - 61,831.27 - 40,308.71 - 22,791.76

- 67,365.21 - 79,970.04 - 111,172.52 - 67,365.21 - 41,610.67 - 37,239.02 - 18,697.18

630,000.00
661,500.00
694,575.00
729,303.75
765,768.94
804,057.38
844,260.25
886,473.27
930,796.93
977,336.78
price increase of 2% (d) Annual Price increase of 5%

10 years 2 years 5 years 10 years

731,396.65 661,500.00 765,768.94 977,336.78

36,569.83 33,075.00 38,288.45 48,866.84

2,000.00 2,000.00 2,000.00 2,000.00

342,109.00 456,609.29 417,858.79 342,109.00

350,717.81 169,815.71 307,621.70 584,360.94

140,000.00 140,000.00 140,000.00 140,000.00

204,722.27 34,727.42 92,259.03 204,722.27

5,995.55 - 4,911.71 75,362.67 239,638.67

4,034.83 - 4,537.66 61,823.64 161,269.96