Hi,
My name is Jim. My question is: (when?) should my wife and I move to a new home?
My wife Natalie and I are in our mid-30s with a dog and no children. Our combined income $250k per yr. We have 2 break-even rental properties valued at $600k and mortgages of $300k. Our primary residence is a $300k townhome in Mississauga with no mortgage; it has a secured and unused $200k LOC on it. We have $225k in retirement savings (mostly stock), $225k in a non-registered stock trading account (mostly stock), $12k in our TFSA (mostly stock), and $100k in cash. Our net worth is approximately $1M.
We would LIKE to move somewhere into the GTA, but we don't NEED to. Should we: a) stay in our Mississauga townhome, use our $100k cash to pay down the mortgages on our rental properties to make them profitable, b) sell our townhome and move, or c) rent out our Mississauga townhome and move, or d)???
And if we decide to do c) should we use the LOC on our Mississauga townhome for a down payment?
Our fears are:
1) Mortgage rates are uncomfortably low (ie. there is a higher chance that rates will ratchet higher rather than lower during the amortization period of a new mortgage)
Our fears are NOT:
1) Stock market declines. We relish declines in any asset class. We made huge purchases in stock over the last year during this meltdown (as well as the last 2002 meltdown). We LIKE stock market meltdowns.
Our tendancy is:
1) Continue the status quo.
Our reasoning is:
1) The government is printing money to prevent the collapse of financial institutions. In economics nothing is 'free'. Inflation is a very real possibility over the next half decade. This will result in a large spike in mortgage rates sooner or later.
PS: We do not want to consult a financial planner with regards to investing. Their knowledge is very bad.
Best regards,
Jim
My name is Jim. My question is: (when?) should my wife and I move to a new home?
My wife Natalie and I are in our mid-30s with a dog and no children. Our combined income $250k per yr. We have 2 break-even rental properties valued at $600k and mortgages of $300k. Our primary residence is a $300k townhome in Mississauga with no mortgage; it has a secured and unused $200k LOC on it. We have $225k in retirement savings (mostly stock), $225k in a non-registered stock trading account (mostly stock), $12k in our TFSA (mostly stock), and $100k in cash. Our net worth is approximately $1M.
We would LIKE to move somewhere into the GTA, but we don't NEED to. Should we: a) stay in our Mississauga townhome, use our $100k cash to pay down the mortgages on our rental properties to make them profitable, b) sell our townhome and move, or c) rent out our Mississauga townhome and move, or d)???
And if we decide to do c) should we use the LOC on our Mississauga townhome for a down payment?
Our fears are:
1) Mortgage rates are uncomfortably low (ie. there is a higher chance that rates will ratchet higher rather than lower during the amortization period of a new mortgage)
Our fears are NOT:
1) Stock market declines. We relish declines in any asset class. We made huge purchases in stock over the last year during this meltdown (as well as the last 2002 meltdown). We LIKE stock market meltdowns.
Our tendancy is:
1) Continue the status quo.
Our reasoning is:
1) The government is printing money to prevent the collapse of financial institutions. In economics nothing is 'free'. Inflation is a very real possibility over the next half decade. This will result in a large spike in mortgage rates sooner or later.
PS: We do not want to consult a financial planner with regards to investing. Their knowledge is very bad.
Best regards,
Jim