Many people don’t know how much they pay in interest each month on their mortgage. I am going to try and break it down as simple as possible so you have an idea each month what you are paying towards the principle on your Grande Prairie home, and how much is going to interest. These are approximate formulas. 

I am going to use simple numbers to make it easier to break down, but the formula is roughly the same for any mortgage. Keep in mind, these are very ballpark numbers and only to be used for an easy way to get an idea and a rough estimate. You should always use a mortgage calculator to get an exact number. Here is a link to the TD Bank Mortgage Calculator, provided by Lind Doberdolani at TD Bank in Grande Prairie. You can reach out to him for any mortgage questions. His number is 780-868-5967. He has been a fantastic resource for me to deal with over the years. Always quick to answer any questions and has helped countless clients of mine. 

With all that being said, here goes:

Say you have a $500,000 mortgage, and get a 6% interest rate over 25 years. (I am using higher than normal numbers to keep the math simple.)

First you would take the interest rate of your mortgage and divide it by 12. So in our example, it would be 0.5% each month. Then you multiply that 0.5% by the outstanding balance. That number is what you are paying on interest each month. In this scenario, the interest each month would be $2,500 per month. 

$500,000 principle × 0.005% monthly interest rate = $2,500

The more you pay that down, the less interest you pay. So each month that interest total drops a bit. There are different types of mortgages, so not all are equal, but I am trying to do this as simply as possible. If the interest rate never changes, as you pay it down, the breakdown would look like this:

$400,000 principle x 0.005% monthly interest rate = $2,000

$300,000 principle x 0.005% monthly interest rate = $1,500

$200,000 principle x 0.005% monthly interest rate = $1,000

$100,000 principle x 0.005% monthly interest rate = $500

Those were some higher numbers. Lets use a more common example. Say you were to buy a home in Grande Prairie, with the average price hovering around $400,000 and a fixed interest rate that was just emailed to me on Monday at 4.19% your numbers would look more like this:

$400,000 principle x 0.0035% monthly interest rate = $1,400

$300,000 principle x 0.0035% monthly interest rate = $1,050

$200,000 principle x 0.0035% monthly interest rate = $700

$100,000 principle x 0.0035% monthly interest rate = $350

These numbers are not exact to every mortgage, as I mentioned there are several different products depending on variable, fixed, etc. This is this is just a simple baseline way to calculate it. These numbers won’t be exact, and could be off by as much as $100 per month at the beginning. Again, we were just going for simplicity in this post. If you make extra payments on your mortgage, you don’t pay that interest, so each month, regardless, your total interest payment will go down. 

Any questions, feel free to reach out and I would be happy to connect you with a mortgage broker to help guide you in the process. I deal with several great ones on a daily basis and would be happy to steer you in the right direction. I hope you got some value out of this, and from my previous blog posts. I try to post at minimum every two weeks to keep you informed on the market and what is happening in the world from my perspective. Feel free to browse my past ones and let me know if you have any questions. Until next time.

Chris

I am going to try and lay out my thoughts on what could happen for real estate in Grande Prairie with all these tariffs and counter tariff threats. It’s a question I get asked a lot from clients and everyday people lately, and my answer has always been, “honestly, I don’t know.” And I will admit, I still don’t. Take this with a grain of salt, I am just a fella trying to make sense of this all, just like most of you. It is by no means financial advice, real estate advice, and most certainly not life advice lol. I realized I have enjoyed getting my thoughts in writing on this blog over the last few months (feel free to check out my previous posts), so this is just my take on things as they stand today. 

All I can go on is what I have seen in the past for real estate in this area, what sometimes happens, and what I “think” may happen going forward. I am not trying to sell anyone anything, or push a narrative that “everything is fine, you should just buy buy buy.” Any client who has ever dealt with me, knows that I am always thinking 5-10 years down the line. When they are looking at a home to buy, I am always thinking “can I sell this in 5-10 years when they call me to sell it for them.” So I think a measured approach is always needed when you are in the market, regardless of whatever sideshow is going on in politics, or around the world. So here goes, I may read this in 5 months and laugh (or cry) about how wrong I was.

Short term outlook, I don’t think there will be much of an impact here. Long term is always anyone’s guess, and if we get into a full blown trade war with the worlds largest economic superpower, nobody in Canada wins, regardless of the region. The Grande Prairie economy is strong, and despite what Donald Trump says, they need Alberta’s resources. The tariff reduction on energy is already an indication of that. What I have seen in the past, and keep in mind, this is a personal outlook/opinion, is when Canada goes into a recession, more people tend to move to Grande Prairie from around the country. With manufacturing most likely taking a big blow, you may see more pain in the Ontario job market than we see here. If there are job losses there, generally the first place people look to is Alberta. And when looking to our province, Grande Prairie, with our still relatively affordable housing, and strong economy is always an attractive looking option. 

I think Edmonton and Calgary could see some price dips more so than here. Since 2020, lots of people in Toronto or Vancouver would sell their overvalued homes there, and move to more affordable options like Calgary and Edmonton, while still enjoying the amenities a major city provides. Those are not the people moving to Grande Prairie for the most part. You are more apt to see the family who lost their manufacturing job in Windsor, who doesn’t have a multi million dollar home in Toronto to sell, to buy something cash here. They are looking at options to provide the best life for their family. Grande Prairie still offers a beautiful home at a reasonable price. While prices have increased here, we are still well below the national average for homes in Canada ($670,064 in January 2025 as per the Canadian Real Estate Association). The average sales price in Grande Prairie in January was $370,288. As per me, right now. 

Long term, I have no clue. I think if someone tells you they have a clue, they are lying. Trump could change his mind this afternoon and then I’ve just wasted a good chunk of my morning researching and writing this post lol. In closing, if you need a place to live, buy a home. You are going pay rent anyways (which is probably going to go up in Grande Prairie if we see massive job losses across the country, and a large number of people migrating here.) If you want to wait and see how it shakes out, I don’t blame you there either. I think short term, there will be little to no impact on prices here. Again, if we get into a full blown trade war, we’ll all be homeless. While I don’t have much faith in the Government of the day, I would hope someone within the party would stop them before it escalated to that. I am hoping this is a short lived pissing match, the adults come back to the room and this is all forgotten by summer. Will that be the case? Maybe, but unlikely. Regardless, I am going to keep on doing what I am doing and going about my life, working, (paying taxes) keeping my head down and living life, and am not terribly worried about the impacts on Grande Prairie as things stand. Oh, I almost forgot, on top of those things, I will also be paying my share of retaliatory tariffs…. Yay. 

Chris