How much did you make selling your house? Are you sure?

  • katma 14 Oca 2015
  • Ever hear someone tell you what the price they bought their house for and what price they sold it for? If it sounds too good to be true, sometimes it is. Many people conveniently forget to factor in realtor fees, mortgage interest, maintenance, property taxes, and more. The actual gains are quite a bit lower than many people think.


  • Craig Degroot
    Craig Degroot 7 yıl önce +27

    That is great math. Except you missed one pretty big factor. If you owned a house, then you did get a benefit from living there every month. In real estate investing, we call that "rent" for a house worth that kind of money, a very modest rent would be $1500 monthly, which would be $18,000 per year, which would be $180,000 over the 10 years of a benefit that the owner got from owning that property. If you are counting mortgage interest and maintenance expenses, then you have to count this as well.

  • Promod Sharma
    Promod Sharma 7 yıl önce +12

    Thanks for this (depressing) analysis, Preet.

  • spector3881
    spector3881 4 yıl önce +2

    the feeling I get from this video and also the "rent Vs buy" one is that home owning is more a way to park your money rather than an investment or a way to create value. It´s more a personal choice: if you like having a house, and want to leave something for your kids, go ahead, but stop seeing home ownership as the holy grail of investment.

  • Blake Williams
    Blake Williams 7 yıl önce +1

    Oh thank goodness you made this Preet. I was so tired of people bragging about their big gains and they would always dismiss any scrutiny!

  • fuckingeveryname
    fuckingeveryname 2 yıl önce

    Thanks for making this. It was helpful to see actual numbers calculated rather than percentages or vague projections.

  • Leah Rubia
    Leah Rubia 3 yıl önce

    That is very insightful. Indeed, most house owners use the simplistic calculations you depicted as a 100% profit gain, whereas indeed they do miss the bigger picture of the expenses, conveyancing fees, taxes, etcetera. I am educated by your analysis on this. Thanks

  • Relative Capital
    Relative Capital 7 yıl önce

    Hi Preet, very nice video!

  • Siva Renganathan
    Siva Renganathan 5 yıl önce +4

    But it means that the property you lived in for 10 years at the end gave you a 'profit of 79k$' instead of you having to pay rent towards it. Its a win anyway!!!

  • Rafet Jameel
    Rafet Jameel 5 yıl önce

    Brilliant work , thank you so much

  • The TANteam Group, Royal LePage Meadowtowne Realty, Brokerage

    So maybe (I mention maybe) you are right, do not buy or own a property. Unless you are extremely discipline with your finances and knows how to do and what to do with all those costs and payment (that was mentioned in the video), you probably will have nothing (anyway) after all those years. Are we suppose to say that all those 10 years of staying alive does not cost a penny?

  • alexbn024
    alexbn024 5 yıl önce

    Nicely done!

  • Yukon ice-cream
    Yukon ice-cream Yıl önce

    Don't forget inflation and the opportunity cost of using the money to invest (and rent instead of buy).

  • John
    John 2 yıl önce +1

    Perfect video! Math is awesome 😍

  • Janizary -
    Janizary - 7 yıl önce +4

    I wouldn't count ongoing expenses. That makes no sense to include it in the estimation. This is the expenses you have to pay anyway, like food and gas. In this case I'd say I made 256 880. All the rest looks logical.

  • Receptical
    Receptical 5 yıl önce +1

    Damn! I'm going to sell my house at a loss if his math is correct =(

  • The TANteam Group, Royal LePage Meadowtowne Realty, Brokerage

    One major component that you left out was the principal amount that you will recover that you actually gets back after the sale, and that should adds another approx $100,624 to the $79.880 making the net in pocket to be, more accurately, approx $180,504 (Derived based on your numbers - assuming purchase and sold at end of 10 full years, with 5% down on a purchase of $300K, mortgage amount including CMHC fees of $9000 totalling $294,000 @4% amortize over 25 years, mortgage payment made on a monthly basis) - An additional point to note, if the buyer has gone variable rate instead of a fix rate and increases the payment frequency from monthly to weekly plus including any additional pre-payment made, the amount of money in your pocket will inches up even further. So if anyone have got the Questions, we have got the answers, just Talk to Tan now! Have a great day. :)

  • X325
    X325 5 yıl önce +1

    This video assumes that if you don't buy, you can live somewhere else COMPLETELY free. (steal a tent and live in the park?)

  • keith boyd
    keith boyd 7 yıl önce +1

    lol at people trying so hard to counter this argument. In the best case scenario of an artificially stimulated boom housing market you can come out slightly ahead. What happens when you buy at the top and your shouse sits and sits and sits at the same price for 10 years?

  • speedxtreem
    speedxtreem 7 yıl önce +1

    Check comments on this video people made on Globe and Mail and have the moral courage to respond to the comments. You have made so many mistakes completing the picture that it's just funny. Your math is incomplete and your view is distorted. I don't need to explain where you did go wrong, cause I am sure you are well aware of them and if you honestly believe that your math is accurate and complete then I need to know which school did you to go to and that is an IF ( I'm sure you did go to a school but your presentation says otherwise). You have a responsibility to your readers when you advise on personal finance on national media so please don't mislead and embarrass yourself in the process. You are not addressing to high school kids ( Sorry High Schoolers, I know you can make a more coherent presentation). I'm not a real estate agent trying to defend my territory, All I expect is from an "Adviser" to present things with a more complete perspective.

  • Optimus Prime
    Optimus Prime 5 yıl önce +28

    That was depressing.