There’s like, this article in the Vancouver Sun, and it’s like, from last week but it’s pretty interesting.
A home you like, can afford trumps market
For example, for someone contemplating borrowing $400,000 with a rate of three per cent, the interest cost over 25 years with a 25-year amortization would be just under $170,000. If the rate increases to six per cent, the cost would be $373,000, an increase of more than $200,000.
That’s an important point to consider whether you’re holding off on buying or signing up for a mortgage. If you go to renew in 5 or 10 years will you be able to afford the payments based on higher interest rates? The solution is obvious. Lock in to a 3 percent mortgage rate for the entire 25 year term of your mortgage.
The only problem with this advice is that it’s impossible. Try offering to lock in to your mortgage for 25 years at 3% and see how your bank reacts.
As long as we’re offering nice but impossible advice, I’d like to suggest you only buy a 8 bedroom house so that you have room to expand and pay no more than $400 so that you have lots of money left over for travel and hobbies.
Also I recommend the end to war and famine.
hat-tip to supersogs for the link!