House Value

The value of our house is moving up again this month, since our insurance gets renewed in May and the insurance company updated the cost of rebuilding at the same time.

As I mentioned in last month Net Worth Update, I now use an average of house value provided by our the municipal tax bill and the rebuilding cost stated on our insurance contract to calculate the value of our house. This month, that will increase by $5 500. I only report my part of the house (60%) on this blog, but that will still generate a hefty $3 300 increase in my net worth.

Personally, that doesn't make me feel any richer, but that increase in value does mean something. What we pay for the house hasn't really changed much. Some portions of it have come down, some others up, but overall the increase has been about 2%, in pace with inflation.

Would we be able to say the same if we were renting? I kind of doubt it, for one important reason. When you rent, you have very little control on the increases. Although a large part of the ownership costs leave you limited control (mortage, insurance, utilities), you have more wiggle room. If you feel that heating costs are too high, you can improve insulation. If your mortage costs are too high, you can renegociate or move your mortage. Same thing with insurance.

Net Worth Update

I have changed the way I calculate the value of our house. Previously, I was simply using the municipal evaluation, which only changes every 3 years and do not really reflects the real value of the house. From now on, I will be using the average of the municipal evaluation and of the rebuilding cost established by my insurer (which is revised at least every year). That way, the estimated value should be closer to its real value. Changing the way I calculate the value of our house increased my net worth by about $9 000, which is taken into account in the following comparison (as noted by the "revised" numbers for last month).

As of May 1st, my net worth is $63 938 (up 4.4% from a revised $61 255). If I exclude house-related assets and liabilities, my net worth is $44 187 (up 6% from $41 655).

Assets ($137 779, up 1.8% from a revised $135 357)

• Bank Accounts $3 614 (up 5% from $3 437)
• Emergency Funds $2 700 (up 10% from $2 454)
• RRSP Accounts $34 815 (up 1.9% from $34 162)
• Non-Registered Investments $7 742 (up 4.2% from $7 428)
• Home $82 800 (stable using revised value)
• Arbitrage $5 000 (stable)

Liabilities ($73 840, down 0.4% from $74 102)

• Credit Cards $4 799 (up 4.9% from $4 573)
• Student Loan $1 408 (down 15% from $1 663)
• Mortgage $56 145 (down 0.2% from $56 253)
• Heat Pump Loan $6 904 (down 0.7% from $6 953)
• Arbitrage $4 402 (down 2.1% from $4 497)

I continued to build up liquidities, increasing both my emergency fund and the my regular bank account. Credit cards increased a little bit, as I had to repair the air conditioning in my car. I decided against using a 12-month financing for this, since my car is getting older and I don't want to have any debt on it when I replace it. Hopefully it will still last 2-3 more years.

Net Worth Update

As of April 1st, my net worth is $54 049 (up 2.9% from $52 535). The expected downdraft for March materialized, but it didn't impact me too much. I am expecting the turbulence to continue for the rest of the year, and am planning my investments accordingly. For me, that means that I will be able to buy good companies at discount prices. A lot of this will be done using my DRiP portfolio, but some purchases will also be made in my registered accounts as money get deposited there. My tax reports are mostly done (waiting for one piece of information for Princess), and I will be getting a reasonable tax return.

If I exclude house-related assets and liabilities, my net worth is $41 655 (up 4.1% from $40 000).

Assets ($128 151, up 0.6% from $127 360)

• Bank Accounts $3 437 (up 47% from $2 336)
• Emergency Funds $2 454 (stable)
• RRSP Accounts $34 162 (up 1.4% from $33 694)
• Non-Registered Investments $7 428 (down 0.7% from $7 484)
• Home $75 600 (stable)
• Arbitrage $5 000 (stable)

Liabilities ($74 102, down 1% from $74 825)

• Credit Cards $4 573 (down 4.7% from $4 800)
• Student Loan $1 663 (down 13% from $1 916)
• Mortgage $56 253 (down 0.2% from $56 360)
• Heat Pump Loan $6 953 (down 0.7% from $7 005)
• Arbitrage $4 497 (down 2.1% from $4 593)

I made progress rebuilding my liquidities. I also purchased a new computer to replace my old one (most of the hardware was from 2001), which died last month. I was lucky enough that it revived long enough that I could transfer all my data without having to use a backup.

Net Worth Update

As of March 1st, my net worth was $52 535 (up 1.8% from $51 609). The markets completed its recovery of the January downdraft, although there are signs they we may be in for another downdraft in March.

If I exclude house-related assets and liabilities, my net worth is $40 000 (up 1.2% from $39 530).

Assets ($127 360, up 0.3% from $127 028)

• Bank Accounts $2 336 (down 30% from $3 331)
• Emergency Funds $2 454 (down 27% from $3 376)
• RRSP Accounts $33 694 (up 2.7% from $32 815)
• Non-Registered Investments $7 484 (up 19% from $6 293)
• Home $75 600 (stable)
• Arbitrage $5 000 (stable)

Liabilities ($74 825, down 0.8% from $75 419)

• Credit Cards $4 800 (down 2.1% from $4 904)
• Student Loan $1 916 (down 11.6% from $2 167)
• Mortgage $56 360 (down 0.2% from $56 467)
• Heat Pump Loan $7 005 (down 0.7% from $7 054)
• Arbitrage $4 593 (down 2.1% from $4 692)

I wanted to take advantage of the recent downdraft to boost my DRiP portfolio, so I deployed quite a bit of cash from my bank accounts and emergency fund. I may have slightly overextended myself, since I now have little liquidity left beyond the essential. Just as I did this, I got hit with some larger-than-expected car maintenance and repair costs. And my personal computer died last week.

So, for next month, I expect to see my non-house-related liabilities increase, since the unexpected expenses went on the credit cards. I will also need to rebuild some of my cash reserve. But I can still sleep at night, since I still have a fairly reasonable emergency fund.

Net Worth Update

As of February 1st, my net worth was $51 609 (up 1.45% from $50 868). With the markets acting the way they did in January, it is nice to see that my net worth increase, even if it was by a small amount.

If I exclude house-related assets and liabilities, my net worth is $39 530 (up a paltry 0.1% from $39 486). The reason for this is that my net worth update was from debt reduction instead of an increase in assets, and most of my debt is related to the house.

Assets ($127 028, down 0.2% from $127 227)

• Bank Accounts $3 331 (down 37% from $5 312)
• Emergency Funds $3 376 (up 22% from $2 761)
• RRSP Accounts $32 815 (up 0.3% from $32 706)
• Non-Registered Investments $6 293 (up 22% from $5 172)
• Home $75 600 (stable)
• Arbitrage $5 000 (stable)

Liabilities ($75 419, down 1.2% from $76 358)

• Credit Cards $4 904 (down 4.6% from $5 138)
• Student Loan $2 167 (down 10.4% from $2 416)
• Mortgage $56 467 (down 0.2% from $56 574)
• Heat Pump Loan $7 054 (down 0.7% from $7 102)
• Arbitrage $4 692 (down 2.1% from $4 792)

Recents month have shown that the stock market is having a large impact on my net worth. This is not surprising, considering that my RRSP and non-registered investing are increasing in value and that they are largely based on stocks. This is something that I can live with, since I am in for the long run.

I am also looking at boosting my emergency fund, mostly to prepare for the home renovations we plan on doing this summer. Although we will try to get a home line of credit, having more cash at hand will counterbalance the increased potential debt.