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If you can’t afford a house, is a condo a smart choice?

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Buying a condo is an obvious option if you're driven to own a house but can't afford it. Problem is, condo buyers often plan to move up to a house in a few years. Is this a smart move, financially?

Only if the condo rises significantly in value. But how much? A blog post by a Toronto real estate agent offers some guidance. Using the example of a downtown Toronto condo owned over five years, Charles Young figures you need a 15 per cent price gain to make condo ownership a better move than simply renting and building up your down payment.

Condo resale value is a key consideration if you're trying to decide whether to get into the housing market via a condo. In some markets, detached houses are much more in demand because of a more limited supply. Another consideration is the cost of condo fees, the rate at which those fees go up annually (often higher than inflation) and any additional charges required for building maintenance.

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Finally, here's a column I wrote recently that suggests aspiring home buyers look at Calgary for a model of affordability. This young couple found affordable housing in the Northern Ontario town of Timmins.

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This is what 13 women spend on retirement vs. coffee
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CBC's Marketplace TV show looks at fake online testimonials for all kinds of products. They find one woman provides fake testimonials for businesses all over the world, who then post them online.

Today's featured financial tool
Try this tool and let me know what you think. It shows you how much of your mutual fund's gains are left over after fees. Some background: Posted returns are shown on an after-fee basis. Add the fund's management expense ratio to the posted return to get the gross return.

Ask Rob
The question: "My robo-adviser firm deducts U.S. income tax from my account every time a U.S. firm in my portfolio pays a dividend. Is that normal?"

My reply: Yes, this is normal for non-registered accounts and TFSAs. There should be no tax withheld in an RRSP or RRIF. In a non-registered account, you may be able to claim the tax withheld by your robo-adviser as a foreign tax credit when completing your income tax return.

Do you have a question for me? Send it my way. Sorry I can't answer every one personally. Questions and answers are edited for length.

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Financial tips for surviving unexpected singledom.

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