Katana Homes / T 416.897.7518 / info@katanahomes.com / © 2016 Katana GROUP.

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SMALL HOME MATH:

  • Assumptions:

    • 640 SF Unit​

    • Monthly Rent for Family Home $2000

    • Borrowing $140,000 at 4% rate to cover initial investment (Garden Suite + Estimated Site preparation + Transport etc.)

    • Allocating 1%/year for upkeep of House and Garden Suite

    • Original Equity $500,000.00

    • Increase in Equity from Garden Suite (Conservative, no inflation) $115,000.00

  • Net Saving = $6,570/yr​

  • Net Proceeds to Estate or for retirement        $615,000.00

What if I live in my Garden Suite/Coach House while renting  out main home?
  • Assumptions:

    • Home Equity $500,000

    • Cash advance based on loan of  $140,000 at 5.9% rate 

    • Cash Advance of  $1167/Month

    • Excluding increased equity in house through inflation

  • Total owing to Reverse Mortgage company  when you move out  $254,493.52

  • Net Proceeds to Estate or for retirement $245,506.48  which is less than half the equity you had before

How does a Reverse Mortgage compare to a Coach House/Garden Suite investment?
  • Assumptions:

    • 640 SF Unit​

    • Monthly Rent $1000

    • Borrowing $140,000 at 4% rate to cover initial investment (Garden Suite + Estimated Site preparation + Transport etc.)

    • Allocating 1%/year for upkeep

    • Not including potential HST rebate 1st year

    • No local incentives applied

  • Excluding increased equity in house

  • Year 1 Positive Cash Flow

  • Net Revenue+Tax Refund = $3250/yr

  • Opportunity! If you agree to keep rents reasonable for 10 years you may be eligible for a $25,000 forgivable loan from the Ontario Renovates Program (Conditions apply to certain areas of the Province)

How much can I make in Rental Income from Coach House/Garden Suite
What can I save by living in a Garden Suite or Coach House on Family Members Property vs Retirement Home?
  • Assumptions:

  • 640 SF Unit​

  • Borrowing $140,000 at 4% rate to cover initial investment (Garden Suite + Estimated Site preparation + Transport etc.)

  • Utility/Food Costs $1200/Month

  • Allocating 1%/year for upkeep

  • Living Independent cost (No Personal Assistance) at Seniors Residence $3000/Month

  • Excluding increased equity in house

  • Savings = $10,000/yr​ plus you get to see your family members!