TD, Royal Bank both raise their fixed mortgage rates
  
Two of Canada's biggest lenders have hiked their benchmark mortgage rates, with Toronto-Dominion Bank raising its posted five-year fixed rate by 45 hundredths of a percentage point and Royal Bank moving its up by 20.
Sellers blame new mortgage rules as average Canadian house price falls 10% in past year
TD moved this week to raise five of its fixed-rate mortgages by between 10 and 50 hundredths of a percentage point.
TD's two-year closed rate is 3.44 per cent, up from 3.34 previously.
TD's three-year closed rate is 3.59 per cent, up from 3.49 previously.
TD's benchmark five-year closed rate is 5.59 per cent, up from 5.14 per cent.
TD's six-year closed rate is 5.64 per cent, up from 5.14 per cent previously.
TD's seven-year closed rate is 5.80 per cent, up from 5.3 per cent previously.
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Three Calculations Every Real Estate Investor Should Know
Don't let your fear of math prevent you from making smart decision on your real estate investments. These five calculations are easy to do. Even a mortgage broker could do them!
1. CAP RATE
Net Operating Income / Total Price of Property
How to Calculate Cap Rate (with pictures)
This calculation is mostly used for valuing apartment complexes and commercial buildings. It can be used for houses and small multifamily too, but operating expenses are erratic with houses.
Aim for a cap rate that is at least as good as comparable buildings in the area. Ideally, strive for an 8.00% cap rate or better, although in some areas like Vancouver or Toronto, that’s not really possible. And always be sure to use real numbers or your own estimates when calculating this.
2. GROSS YIELD
Annual Rental Income / Property Value
This is the income return on your investment before any expenses, outgoings or possible rental vacancies are taken into account. Gross yield also does not take interest rates into account.
Gross rental yield is commonly used when looking at returns, as it is simple to calculate and lets you easily compare properties with different values and rental returns.
To calculate, take the 'Annual rental income (Weekly rent x 52 weeks)' and divide by the 'Property value'. Then multiply this number by 100.
Example: Property value $600,000 and expected rent $500 a week.
$26,000 ($500 x 52 weeks) (annual rental income)
÷ $600,000 (property value)
x 100
Yield = 4.33% ROI (Return On Investment)
3. CASH FLOW
Cash flow is important if you are hoping to make money month to month on your real estate investment. It is important to consider the monthly cost of borrowing your money, maintenance fees, heating, insurance and taxes. It is also important to estimate the cost of having a vacant unit for a month or two. Giving yourself this buffer, will insure that you will need a 100% tenanted property to be profitable or cash flow positive. If you are investing in the city, rents have steadily increased. Vacancy rate is under 1% which puts upward pressure on the monthly rental prices.
Those are the basic operational items that go into our cash flow calculation. Let's take our calculation to the profits:
Rent income - Vacancy Loss - Payments - Expenses = Cash Flow
Analyzing your return as "cash on cash invested", you would divide your actual cash investment (down payment) into the annual return of cash.
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