We have broken down the total price with nearly every consideration we can think of - I didn't want to just come out and say 'our new house will cost x' - so here are all the details:
We have a general 'design center' category because as we have updated the house to include a gas range, we'll need to upgrade the stove as well. We also wanted to pad a bit in case there is anything we have forgotton.
I'm 100% positive that the GST Rebate number is not correct. It's a best guess based on reading and some information provided by the seller. If anyone knows how to accuratly calculate this, please let me know. Otherwise, we'll find out on Thursday when we meet with the Selling Agent again.
The CMHC insurance rate is 2.95% based on a 30 year amortization
The above numbers are not yet set in stone, but this is what we are comfortable with. We meet with the Selling Agent again on Thursday and then will have a few appointments in the design center (otherwise called the money pit) before things are 100% confirmed.
So, how does that impact our monthly payments?
Jordan and I will set up our payments on a weekly basis rather than monthly which will of course reduce the interest paid - but I prefer to use mortgage calculators based on monthly because the monthly amont is higher (when there are four weeks in a month).
While we actually have a current five year fixed rate held at 3.39% - it was a 120 day hold and we are looking at taking posession around September/October -quite a ways a way. Our Mortgage Broker can extend the hold, but not for a years time. Once we have our purchase agreement signed, she'll be able to secure a longer term rate (which is way I did the calculations with a higher interest rate).
While we have a fixed rate hold - that is really for back up in case the market significantly changes - we're keen on taking a variable rate. Our plan is to set up our weekly payments and then round up to $1,500 a month. We'll put the excess in a separate ING account and then if/when variable rate increases we just adjust how much is going into the ING account - so were effectivly always 'paying' the same amount. At the end of each year, we'll do a lump sum payment of whatever is left in the account.
Here is what our budget will look like:
You might notice a couple of changes from our 'normal' budget. Other then house insurance and property taxes and of course an increased utility payment - we have also accounted for an increased gas bill (because of location where we are building). While we budget for about $1300/month for our general monthly expenses (on the credit card) we've been averaging $1600-$2000 - so I updated this budget to be more realistic. We've also chosen to try getting rid of our allowances.
While I know that you're supposed to budget for what you have, not what you will have - Jordan and I are also both expecting raises between now and when we take possession. So while it's a bit tight, keep in mind that we're padding the house payment, padding our general spending and will be making more money. A few have asked, so I'll share that I'm also looking for a new home for my horse - while this is not a decision I have made based on our financials, it's one that will impact them.
..phew...okay, so that was a realy long post!
I would love to hear from other who have build or bought recently and have any comments/concerns - any who haven't, I'd love your questions!