THE COST TO RENT VS THE BENEFIT OF OWNING

EXAMPLE ONE A tenant paying $1,000 per month for 5 years, has out of pocket expense of $60,000. A home owner who bought a house for $150,000 would have monthly payments of about $1,000* (for mortgage, interest and taxes) at the end of 5 years they would have paid down their mortgage by $23,877. With average appreciation, their home would have increased in value to $200,000, an additional $50,000. If they then sold their home, they would realize a gross profit of $77,877 after spending the same $60,000.
*based on 5.5% interest, 25yr amortization (5% value increase per year based on past 5 years)

Thus, at the end of 5 years, the tenant has nothing to show for money spent. At the end of 5 years, the homeowner would have about $77,877 (less cost of sale and purchase) that they can re-invest in another home or they can renegotiate their mortgage for the smaller balance and have a lower monthly payment.

EXAMPLE TWO A homeowner who bought a house 5 years ago for $200,000 with 5% downpayment would now owe $168,000 on their mortgage and their house would have appreciated to about $254,000*. If the house was sold, there would be about $86,000 in equity to put towards a new home or to share if they were joint owners.
*based on 5.5% interest rate and 25 year amortization

THE BENEFITS OF SHARING

1. You can buy a larger home than you could on your own, probably in better condition and in a better location.
2. Repairs and maintenance are shared as well
3. A better neighbourhood may mean your children attend a better school

WHO SHOULD CONSIDER EQUITY SHARING?

This is a great way for young people to get into the market. Join with a friend or relative and both of you can start investing in the real estate market.

Singles, young couples, widows/widowers or divorcees now on their own, will find equity sharing allows them to live in a home as opposed to an apartment, and they can continue to enjoy hobbies such as gardening and entertaining in the larger property with someone to share the expenses.

Families may find equity sharing will allow them to buy that dream cottage sooner—they can share time and expenses with another family who has the same goal.

The Property Connectors can put together many different scenarios. All it takes is a willingness on your part to think outside the box and a strong desire to own your own home and a willingness to share.

Click to register with The Property Connectors!