Sometimes we make buying real estate more complicated that it really is! For investors of course, you need to do the ‘rate of return’ – cash on cash plus appreciation projections. But for someone buying a home (note I did not say house because we sell condos!), it is really quite simple. How much do I have for a down payment plus how much can I afford to pay or carry each month? A mortgage broker or a lender will determine how much you can afford, based on your income and your current debt levels (credit cards, car payments). By afford we mean how much can I pay each month (or each week if you prefer) and still live!!! It’s just like figuring out how much I am going to pay for groceries each week or month. This number will determine what I can buy! So it is not about the price of the property but rather, what can I afford to pay each month or week. Smart agents know to show people properties on the basis of monthly or weekly payments – not on the basis of a list price! For example: when condo fees or property taxes are higher for one 600 sq.ft. unit than for other comparable sized units, then the price of that unit will adjust downwards until carrying costs are equal to similar units (mortgage payments plus condo fees and taxes)! That’s why prices are lower at the Pantages and Soho – condo hotels - than other condos downtown. It’s not because owners under price their units, they already know they have to compete on total monthly carrying costs to sell. So don't think you are getting a deal just because condo prices look relatively cheaper in one building over another.

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