[corcoran2015]

Great comment DMAC. The model shows what will happen if rates go up 1% and condo prices are flat. Rents paid are definitely factored in the model as are taxes. The investor is in a TFSA & RRSP which means capital gains are a non-issue. Property taxes cant be avoided though. Its a real advantage of investing in Canada to use the RRSP & TFSA vehicles.

You're right, mortgages can typically be locked in for five years.

But really people can check out the model and use their own assumptions:

https://docs.google.com/spreadsheets/d/1ZJnbA2MO7iuQc4xEX9E2...

[DMac87]

1. RRSP & TFSAs have limits much lower than the assumed contributions, so there are tax differences between the two alternatives. 2. Even slight tweaks to your assumptions (e.g. reduce investment returns to 6%, increase condo returns to 2%) equalize the two scenarios. If you're going to use such an ill-conditioned model, you really must spend significantly more time justifying all of its assumptions, or else show sensitivities to them.