5833 replies to this topic

[spanky123]

^ Many people like the idea of home ownership as (for now) the gains on the sale of a primary residence are tax free so most long term homeowners will have funds available at retirement. You can make a good case however that setting aside the money you save on rent each month for investment will yield you as good a retirement nest egg.

[spanky123]

I've heard this advice before, but I'm not willing to leave my career and my life to live somewhere with cheaper housing prices. Maybe that exempts me from sympathy. I guess if there were no chance for me to ever buy here, I would rent forever. 

 

Here's the frustrating bit. A couple years ago, I started casually looking at condos. I was in a lower paying job with no major savings. I went to the bank to find out what I could afford and was told to keep saving. So I did. I worked hard and improved my education and landed a job that pays about $10,000 more per year. My savings grew significantly as a result of having a higher income, as well as a lump sum payment from my former pension plan and a small gift from a relative's estate. I attended a couple open houses and started thinking about getting an agent. Then, I got an email from the owner of the place I was renting. She wanted to move back in wasn't going to renew my lease. I had a month to find a new place. I was fortunate enough to have a friend with a relative in a property management company and was able to sign the lease on a place before it was posted anywhere. With all the stress of moving, I had to give up on looking at condos. Six months later, I got an agent and started looking again. But when I talked to the mortgage brokers, I found out that the new stress test had just been introduced. Combining that with the rapid increase of housing prices, I was suddenly back to where I started. I worked hard and made sacrifices, but the market outpaced me. 

 

I know I haven't a different perspective than many posters here. I don't think the current system is fair, but others have a right to disagree with me. Despite that, I hope that even the more right-leaning folks can see why I'm a bit salty. 

 

Personally I think that you may be thanking your banker in a couple of years. Current housing prices are not sustainable in several markets such as Victoria, Vancouver and Toronto. With interest rates and the economy growing in the US, the bank of Canada will either have to start raising rates here or accept a $.60 dollar as our new reality. In either event people who are stretched to make payments now will not be able to sustain themselves.

[spanky123]

 

The mortgage stress test seems pretty reasonable to me. Mortgages at 4.5% were the norm just a few years ago. Do you really want to assume that you'll never have to pay an interest rate like that?

 

My first mortgage for a condo in Victoria was at 12%. In 2008 I was paying 5.65% on a mortgage.

 

The problem is that anyone younger than 28 has never had to deal with an economic cycle before. They assume that interest rates will always be low and that there will always be jobs available and money will be easy to borrow.

[Mike K.]

^^We've rinsed and repeated that very statement on VV since day one of this forum.

 

We're all here for a reason, right? And for every person in Victoria who wants to flee for greener pastures (wherever those may be), there's a dozen wishing they could live here, and another dozen making preparations to move here. 

 

If we could just forget what the market is doing and do what's right for us we'd all be a little bit happier and stress free.

[spanky123]

^ True although I was commenting specifically on FTHC's specific case. I think that with housing prices where they are, very few working people in this market can afford a house and even if they can come up with the down payment, wage growth and job prospects for increased salaries don't exist to offset the rate and pricing risks.

 

I agree with your assertion that wealthy people (retirees and foreigners) moving into Victoria can afford condos and houses and may continue to drive up prices but that is an entirely different group.

[Mike K.]

Very few people can afford to buy real-estate anywhere, not just Victoria. If buying real-estate was something everyone could do, nobody would rent.

 

We've been a city full of renters since time immemorial. Even in the 70's when real-estate was dirt cheap on the south Island 70% of the population rented.

[spanky123]

^ I could be wrong but I suspect that many people rent because they don't want to be tied to a single area or piece of property for an extended period of time and don't want to have to deal with maintenance and repairs. Now I realize that you could just sell your house and move if you wished but doing so every few years would have most of your profits eaten away by fees and taxes.

Edited by spanky123, 22 March 2017 - 09:07 AM.

[Fat Tug]

Here's one I find a bit of a head scratcher. There's now 2 condos asking $1 million+ in the Hudson building. The suites in that building look nice, but 7-figures??

 

https://www.realtor....Columbia-V8W0B8

 

https://www.realtor....Columbia-V8W0B8

[LeoVictoria]

Very few people can afford to buy real-estate anywhere, not just Victoria. If buying real-estate was something everyone could do, nobody would rent.

 

We've been a city full of renters since time immemorial. Even in the 70's when real-estate was dirt cheap on the south Island 70% of the population rented.

 

Where is this stat from?  Never heard of 70% renting.

[Nparker]

Where is this stat from?  Never heard of 70% renting.

"VHF's Big Book of Amazing Stats" 

[Sparky]

Very few people can afford to buy real-estate anywhere, not just Victoria. If buying real-estate was something everyone could do, nobody would rent.

 

We've been a city full of renters since time immemorial. Even in the 70's when real-estate was dirt cheap on the south Island 70% of the population rented.

 

Home ownership is an interesting topic. Canadians as a whole prefer to own rather than rent.

 

I bought my first house in the early 70's for $19,100, but that was double what my brother paid for his house a few years before. The interest rates for first mortgages at the time was around 10%. It was not uncommon to have two mortgages on a home especially for a first time buyer, and especially in BC with the readily available "BC Second Mortgage" program.

 

Victoria might be slightly different than the national average, but probably not as much as one might think. There seemed to be a lot of apartment buildings here but I don't think we were any different than most cities. The late 60's and early 70's saw a boom in housing construction in the single family housing market. I used to sell light fixtures to builders and knew most of the big players at the time. Hugo Hucker for example, built up a lot of Colwood which was the land of opportunity at the time. He built 365 "spec" houses a year. When I was first told that I couldn't believe that he could build a house a day. The trades just kept working their way down the street as the buildings progressed. 

 

Now that I have produced my "light bulb" certification of expertise on the housing market, let's have a look at what type of housing people have lived in over time in Canada. Regions will vary in statistics obviously, but probably no more than 10-15% from the national average. Stats Canada would have us believe that Canadian homeowners have increased in numbers in the 40 years between 1971-2011 from 60% to 70%. My trusty slide rule (most of you probably have never used one of these) would have me believe that if that were true, people that rented their housing would have decreased during that period from 40% to 30%. http://www.census200...g/c-g01-eng.cfm

 

I was having a little trouble sleeping tonight, so I thank you for this opportunity to bore myself back to bed.

[Mike K.]

Thanks for that, Sparky.

[AllseeingEye]

Home ownership is an interesting topic. Canadians as a whole prefer to own rather than rent.

 

I bought my first house in the early 70's for $19,100, but that was double what my brother paid for his house a few years before. The interest rates for first mortgages at the time was around 10%. It was not uncommon to have two mortgages on a home especially for a first time buyer, and especially in BC with the readily available "BC Second Mortgage" program.

 

Victoria might be slightly different than the national average, but probably not as much as one might think. There seemed to be a lot of apartment buildings here but I don't think we were any different than most cities. The late 60's and early 70's saw a boom in housing construction in the single family housing market. I used to sell light fixtures to builders and knew most of the big players at the time. Hugo Hucker for example, built up a lot of Colwood which was the land of opportunity at the time. He built 365 "spec" houses a year. When I was first told that I couldn't believe that he could build a house a day. The trades just kept working their way down the street as the buildings progressed. 

 

Now that I have produced my "light bulb" certification of expertise on the housing market, let's have a look at what type of housing people have lived in over time in Canada. Regions will vary in statistics obviously, but probably no more than 10-15% from the national average. Stats Canada would have us believe that Canadian homeowners have increased in numbers in the 40 years between 1971-2011 from 60% to 70%. My trusty slide rule (most of you probably have never used one of these) would have me believe that if that were true, people that rented their housing would have decreased during that period from 40% to 30%. http://www.census200...g/c-g01-eng.cfm

 

I was having a little trouble sleeping tonight, so I thank you for this opportunity to bore myself back to bed.

You came up with all those calculations after 3:30am? I salute you sir (full disclosure: I once picked up a slide rule in Physics 11 in 1976 @ MDHS. Being completely befuddled I tossed it down on my desk in disgust, and have never picked up another one since).

 

My parents bought their "last" house in the UVic-Mt Tolmie neighborhood in July 1972 and paid the "unthinkable" sum of $29,900 for it; their previous home on Cedar Hill Rd, purchased almost eight years previously in early 1965, having cost them a cool $8500. Times have indeed changed. 

[Mike K.]

 

Victoria's 10 cheapest houses for sale, spring 2017 edition

http://victoria.citi...g-2017-edition/

[exc911ence]

If land is the valuable commodity in the CRD, why would anyone consider paying almost half a million dollars for a float-home?

[VicHockeyFan]

I'd guess that you are paying for the spot, as much as anything.  They are not making new spaces.   I wonder how long the water leases are.

 

 

 

Minimalist float homes for sale in North Vancouver are priced at $399,000. Incorporating an innovative design by maximizing natural light, a floating home that redefine the ideals in space efficiency.

 

https://mosquitocree...il-ocean-homes/

 

http://www.youtube.com/watch?v=MgnZJaRXvBY

[LeoVictoria]

Hmmm... float home for $400k or mobile home for about $100k..

[AllseeingEye]

Don't know what the cost would be in the CRD but a friend of mine who is a senior environmental planner for one of the large international engineering firms is, unsurprisingly, a huge proponent of off the grid, environmentally responsible living.

 

When he was living in Nanaimo in 2015 he researched closely the option of pre-fabricated homes with all the environmental bells and whistles; for that market for a pre-fab of between 1500-1800 s/f, he was looking at about $150K all in. Of course land prices there are significantly less than in Victoria, but still I thought it was an intriguing concept.

[G-Man]

I don't think you can really put float homes as the cheapest home as the moorage downtown will make your monthly cost closer to buying a 700k or 800k home.

[Szeven]

I see one of these limited income units has come up in Dockside for a first time buyer:

 

https://listedbysell...ritish-Columbia