Question 1

How is the Canadian mortgage payment computed?

Accepted Answer

Quoted rates compound semi-annually. Effective monthly rate: (1 + r/2)^(1/6) − 1. Payment uses standard amortization on principal including CMHC when down payment is below 20%.

Question 2

Does the renter invest the same money as the buyer at closing?

Accepted Answer

Yes. The renter is modeled with down payment plus closing costs invested at the market return. The buyer puts the down payment into equity and pays closing costs to third parties.

Question 3

How are exit taxes handled?

Accepted Answer

Portfolio gains are taxed annually in a non-registered account. Home sale at the horizon uses the principal residence exemption by default (no tax on the home for a full PR). Marginal rate and inclusion rate are editable.

Question 4

What does apply sale costs do?

Accepted Answer

When on, buyer wealth at exit reflects selling: property value minus realtor and legal costs minus mortgage. When off, wealth is paper equity (property minus mortgage) if you keep the home.

Question 5

What is not included?

Accepted Answer

Not modeled: TFSA/FHSA room, RRSP withdrawals, refinancing, rent control, moving costs, or detailed dividend tax. Results are directional, not financial advice.