Richmond Real Estate Market

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Richmond is an island city. It is made up of a number islands in the Fraser River delta. It is just one meter above sea level. It was prone to flooding, especially during high tide. Therefore, major islands are now surrounded by a system of dykes, which serve to protect the town. Also, since it occupies land in a river delta, the city has plenty of rich soil for agriculture. Richmond is a culturally unique community. As of 2021, the city has an estimated population of 209,937 people with 60 percent being immigrants, the highest proportion of immigrants in Canada. Majority of immigrants are Chinese. Richmond has been experiencing growth and change, transforming from a rural, local community to an international city with a balance of urban, suburban family and rural areas. The city is 20 minutes from downtown Vancouver and 25 minutes from US border. It’s the location of Vancouver’s international airport.  The SkyTrain, Canada Line, speeds up transit system and connects Richmond to other
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Mortgage Payment Options

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A lot of people get a mortgage when they buy a property, especially when mortgage rates are so low. What options does a borrower have to pay the mortgage and which option benefits a borrower more? Generally, more frequent payments create substantial interest savings and reduce the loan’s amortization period. We discuss three options here: monthly payments, biweekly payments and accelerated biweekly payments. Biweekly payments are popular since they match most people’s earning frequency. What is the difference between biweekly payments and accelerated biweekly payments? Biweekly payments are constant payments that are paid every two weeks. Accelerated biweekly payments are constant payments that are equal to ½ of the regular monthly payment and paid every two weeks. We use an example to illustrate three options.

A mortgage loan of $200,000, interest rate 2.39%, calculated semi-annually, not in advance. Amortization period of 30 year, and a term of 5 year.

Option

Each Payment

Principal Paid over Term

Interest Paid over Term

Balance end of Term

Constant Monthly Payments

$777.63

$24,266.08

$22,391.72

$175,733.92

Constant Biweekly Payments

$358.72

$24,266.79

$22,366.81

$175,733.21

Accelerated Biweekly Payments

$388.82

$28,419.79

$22,126.81

$171,580.21

 

Accelerating payments is a faster way to pay off a mortgage and to reduce interest costs. The borrower actually makes the equivalent of one extra monthly payment per year.  The borrower would pay $4,153.00 more by end of a 5 year term in this case. 

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