There’s no doubt about it, the price of a home in Vancouver is definitely more expensive than the suburbs.

But what about the commute?

No, not just the hours stuck in traffic, I’m talking about the actual costs.

David Hughes in the Toronto area makes this point quite clearly.

Mr. Hughes’s spreadsheet below is a great conversation starter and a must-read for home buyers who are searching for affordability in the suburbs.

Living in the suburbs

Home purchase price
$500,000
Downpayment
$50,000
Mortgage principal (includes 2% CMHC fee)
$459,000
Auto costs annually
$19,000
25 years of automobile costs
$475,000
Monthly mortgage payment 25 years at 3.5%
$2,291
Monthly automobile expenditures
$1,583
Mortgage plus automobiles, monthly
$3,874
Post-mortgage car costs: 15 years of 1 car
$142,500
Total paid for home (interest and principal)
$687,495
Total paid for cars
$687,495
Total paid to live and get around for 40 years
$1,304,995

Living in the city

Home purchase price
$720,000
Downpayment
$50,000
Mortgage principal (includes 2% CMHC fee)
$688,425
Auto costs annually
$6,000
25 years of automobile costs
$150,000
Monthly mortgage payment 25 years at 3.5%
$3,437
Monthly automobile expenditures
$500
Mortgage plus automobiles, monthly
$3,937
Post-mortgage car costs: 15 years of 1 car
$90,000
Total paid for home (interest and principal)
$1,031,130
Total paid for cars
$240,000
Total paid to live and get around for 40 years
$1,271,130

 

Assumptions

  • Car costs estimated at $9,500 per year for a compact car using CAA numbers times two vehicles
  • Downtown transportation costs pegged at $235.50 for 2 adult transit passes per month plus discretionary transit spending of $264.50 per month
  • Mortgage is paid over 25 years at a constant rate of 3.5 per cent

Mark Fidgett is a Vancouver mortgage broker and the driver behind www.NotaPennyDown.com

Your Vancouver Mortgage Broker For Life
604-273-2002

www.notapennydown.com

P.S. Who’s the next person you know who wants to save thousands off their mortgage? Be sure to give me a call so we can help them! 604-273-2002

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