buying a house in an economic minefield
Aug 10th 2009, 5:26 pm
#91
Bring on the snow!
Joined: Jan 2006
Location: Chicago, IL
Posts: 1,420
Re: buying a house in an economic minefield
No one really knows what house prices are going to do. Buying instead of renting is basically locking yourself into the specific housing market, in a particular location, at a specific price. If pries go up and you still want to live in the same area then you did well to buy. If prices go down and you could have rented for less then you should have held out - but who knows....
For us - we bought last year, and yes it was probably at the so called top of the market - but you know what, who cares - thats life. We love our house, didn't over stretch, and were sensible in our budgeting. On the upside our mortgage is now stupidly cheap (at a rate we wouldn't be able to get now), and in the past year I've done a lot of renovating to get the place how we'd like it. In a rented property I wouldn't have bothered.
Sure if we'd have waited a year we might have been able to pick something up a little cheaper, however life is not all about waiting around. I view our place as a home first and an investment second. Now we're in the market, I don't care what prices do - in fact if they come down a little in the next five years it'll actually make trading up a little easier (less gap in price, less transaction fees etc) so bring it on.
As for renting - it's great for flexibility and the cost for renting a condo d/town looks like a bargain compared to buying. But surely things will come into balance. If house prices start to fall then why would a landlord rent at a loss? The only reason thats done now is a gamble on making a return on capital. If that goes away surely renters should expect to pay the cost of owner + a return. So then it's cheaper to buy and the cycle stats again....
No brainer to get in at the bottom if you can - but good luck getting the timing right....
For us - we bought last year, and yes it was probably at the so called top of the market - but you know what, who cares - thats life. We love our house, didn't over stretch, and were sensible in our budgeting. On the upside our mortgage is now stupidly cheap (at a rate we wouldn't be able to get now), and in the past year I've done a lot of renovating to get the place how we'd like it. In a rented property I wouldn't have bothered.
Sure if we'd have waited a year we might have been able to pick something up a little cheaper, however life is not all about waiting around. I view our place as a home first and an investment second. Now we're in the market, I don't care what prices do - in fact if they come down a little in the next five years it'll actually make trading up a little easier (less gap in price, less transaction fees etc) so bring it on.
As for renting - it's great for flexibility and the cost for renting a condo d/town looks like a bargain compared to buying. But surely things will come into balance. If house prices start to fall then why would a landlord rent at a loss? The only reason thats done now is a gamble on making a return on capital. If that goes away surely renters should expect to pay the cost of owner + a return. So then it's cheaper to buy and the cycle stats again....
No brainer to get in at the bottom if you can - but good luck getting the timing right....
Aug 10th 2009, 5:27 pm
#92
Forum Regular
Joined: May 2009
Location: Wolfville, NS
Posts: 144
Re: buying a house in an economic minefield
I have been in Ottawa since 1963 and I don't think any properties have increased 100X since 1963. Places such as shown in this MLS listing sold for around $22,000 in 1963 and have risen about 20X.
http://orebweb1.oreb.ca/mlssearch/fr...mls_num=734895
http://orebweb1.oreb.ca/mlssearch/fr...mls_num=734895
BTW, the property you mentioned is not a great Westboro location and might be impacted by the condo development planned for the next street over.
http://westborocollection.com/
Aug 10th 2009, 5:35 pm
#93
Beep
Joined: Jan 2009
Location: Here
Posts: 8,311
Re: buying a house in an economic minefield
If house prices start to fall then why would a landlord rent at a loss? The only reason thats done now is a gamble on making a return on capital. If that goes away surely renters should expect to pay the cost of owner + a return. So then it's cheaper to buy and the cycle stats again....
Once prices begin to rise (as they are in London) more people will decide to sell bringing a decline in rental properties and helping the latter prices rise.
All in my opinion of course.
Aug 10th 2009, 5:40 pm
#94
Bring on the snow!
Joined: Jan 2006
Location: Chicago, IL
Posts: 1,420
Re: buying a house in an economic minefield
I'm not sure about Vancouver rental but in London the rental prices came down along with property values purely because of the saturation of the rental market whereby people refused to sell and chose to become landlords for a while.
Once prices begin to rise (as they are in London) more people will decide to sell bringing a decline in rental properties and helping the latter prices rise.
All in my opinion of course.
Once prices begin to rise (as they are in London) more people will decide to sell bringing a decline in rental properties and helping the latter prices rise.
All in my opinion of course.
Aug 10th 2009, 5:41 pm
#95
Joined: Dec 2008
Posts: 3,054
Re: buying a house in an economic minefield
No one really knows what house prices are going to do. Buying instead of renting is basically locking yourself into the specific housing market, in a particular location, at a specific price. If pries go up and you still want to live in the same area then you did well to buy. If prices go down and you could have rented for less then you should have held out - but who knows....
For us - we bought last year, and yes it was probably at the so called top of the market - but you know what, who cares - thats life. We love our house, didn't over stretch, and were sensible in our budgeting. On the upside our mortgage is now stupidly cheap (at a rate we wouldn't be able to get now), and in the past year I've done a lot of renovating to get the place how we'd like it. In a rented property I wouldn't have bothered.
Sure if we'd have waited a year we might have been able to pick something up a little cheaper, however life is not all about waiting around. I view our place as a home first and an investment second. Now we're in the market, I don't care what prices do - in fact if they come down a little in the next five years it'll actually make trading up a little easier (less gap in price, less transaction fees etc) so bring it on.
As for renting - it's great for flexibility and the cost for renting a condo d/town looks like a bargain compared to buying. But surely things will come into balance. If house prices start to fall then why would a landlord rent at a loss? The only reason thats done now is a gamble on making a return on capital. If that goes away surely renters should expect to pay the cost of owner + a return. So then it's cheaper to buy and the cycle stats again....
No brainer to get in at the bottom if you can - but good luck getting the timing right....
For us - we bought last year, and yes it was probably at the so called top of the market - but you know what, who cares - thats life. We love our house, didn't over stretch, and were sensible in our budgeting. On the upside our mortgage is now stupidly cheap (at a rate we wouldn't be able to get now), and in the past year I've done a lot of renovating to get the place how we'd like it. In a rented property I wouldn't have bothered.
Sure if we'd have waited a year we might have been able to pick something up a little cheaper, however life is not all about waiting around. I view our place as a home first and an investment second. Now we're in the market, I don't care what prices do - in fact if they come down a little in the next five years it'll actually make trading up a little easier (less gap in price, less transaction fees etc) so bring it on.
As for renting - it's great for flexibility and the cost for renting a condo d/town looks like a bargain compared to buying. But surely things will come into balance. If house prices start to fall then why would a landlord rent at a loss? The only reason thats done now is a gamble on making a return on capital. If that goes away surely renters should expect to pay the cost of owner + a return. So then it's cheaper to buy and the cycle stats again....
No brainer to get in at the bottom if you can - but good luck getting the timing right....
There does come a time when it makes sense to buy over renting but with the spreads at the minute it makes no sense.
Aug 10th 2009, 5:50 pm
#96
Joined: Aug 2005
Posts: 14,227
Re: buying a house in an economic minefield
I'm not sure about Vancouver rental but in London the rental prices came down along with property values purely because of the saturation of the rental market whereby people refused to sell and chose to become landlords for a while.
Once prices begin to rise (as they are in London) more people will decide to sell bringing a decline in rental properties and helping the latter prices rise.
All in my opinion of course.
Once prices begin to rise (as they are in London) more people will decide to sell bringing a decline in rental properties and helping the latter prices rise.
All in my opinion of course.
Aug 10th 2009, 5:53 pm
#97
BE Enthusiast
Joined: Oct 2002
Location: Ottawa, Canada
Posts: 556
Re: buying a house in an economic minefield
No one really knows what house prices are going to do. Buying instead of renting is basically locking yourself into the specific housing market, in a particular location, at a specific price. If pries go up and you still want to live in the same area then you did well to buy. If prices go down and you could have rented for less then you should have held out - but who knows....
For us - we bought last year, and yes it was probably at the so called top of the market - but you know what, who cares - thats life. We love our house, didn't over stretch, and were sensible in our budgeting. On the upside our mortgage is now stupidly cheap (at a rate we wouldn't be able to get now), and in the past year I've done a lot of renovating to get the place how we'd like it. In a rented property I wouldn't have bothered.
Sure if we'd have waited a year we might have been able to pick something up a little cheaper, however life is not all about waiting around. I view our place as a home first and an investment second. Now we're in the market, I don't care what prices do - in fact if they come down a little in the next five years it'll actually make trading up a little easier (less gap in price, less transaction fees etc) so bring it on.
As for renting - it's great for flexibility and the cost for renting a condo d/town looks like a bargain compared to buying. But surely things will come into balance. If house prices start to fall then why would a landlord rent at a loss? The only reason thats done now is a gamble on making a return on capital. If that goes away surely renters should expect to pay the cost of owner + a return. So then it's cheaper to buy and the cycle stats again....
No brainer to get in at the bottom if you can - but good luck getting the timing right....
For us - we bought last year, and yes it was probably at the so called top of the market - but you know what, who cares - thats life. We love our house, didn't over stretch, and were sensible in our budgeting. On the upside our mortgage is now stupidly cheap (at a rate we wouldn't be able to get now), and in the past year I've done a lot of renovating to get the place how we'd like it. In a rented property I wouldn't have bothered.
Sure if we'd have waited a year we might have been able to pick something up a little cheaper, however life is not all about waiting around. I view our place as a home first and an investment second. Now we're in the market, I don't care what prices do - in fact if they come down a little in the next five years it'll actually make trading up a little easier (less gap in price, less transaction fees etc) so bring it on.
As for renting - it's great for flexibility and the cost for renting a condo d/town looks like a bargain compared to buying. But surely things will come into balance. If house prices start to fall then why would a landlord rent at a loss? The only reason thats done now is a gamble on making a return on capital. If that goes away surely renters should expect to pay the cost of owner + a return. So then it's cheaper to buy and the cycle stats again....
No brainer to get in at the bottom if you can - but good luck getting the timing right....
Aug 11th 2009, 3:22 am
#98
Just Joined
Joined: Aug 2009
Location: North Vancouver
Posts: 28
Re: buying a house in an economic minefield
I have been in Ottawa since 1963 and I don't think any properties have increased 100X since 1963. Places such as shown in this MLS listing sold for around $22,000 in 1963 and have risen about 20X.
http://orebweb1.oreb.ca/mlssearch/fr...mls_num=734895
http://orebweb1.oreb.ca/mlssearch/fr...mls_num=734895
Aug 11th 2009, 3:41 am
#99
Account Closed
Joined: Jan 2006
Posts: 0
Re: buying a house in an economic minefield
The rental argument is great if you willing to accept that you are not in control and may not be able to save for the future
Or one just doesn't have the income to buy.
Or one just doesn't have the income to buy.
Aug 11th 2009, 5:24 am
#100
9 months, start to finish
Joined: Jul 2008
Location: VANCOUVER
Posts: 904
Re: buying a house in an economic minefield
No one really knows what house prices are going to do. Buying instead of renting is basically locking yourself into the specific housing market, in a particular location, at a specific price. If pries go up and you still want to live in the same area then you did well to buy. If prices go down and you could have rented for less then you should have held out - but who knows....
For us - we bought last year, and yes it was probably at the so called top of the market - but you know what, who cares - thats life. We love our house, didn't over stretch, and were sensible in our budgeting. On the upside our mortgage is now stupidly cheap (at a rate we wouldn't be able to get now), and in the past year I've done a lot of renovating to get the place how we'd like it. In a rented property I wouldn't have bothered.
Sure if we'd have waited a year we might have been able to pick something up a little cheaper, however life is not all about waiting around. I view our place as a home first and an investment second. Now we're in the market, I don't care what prices do - in fact if they come down a little in the next five years it'll actually make trading up a little easier (less gap in price, less transaction fees etc) so bring it on.
As for renting - it's great for flexibility and the cost for renting a condo d/town looks like a bargain compared to buying. But surely things will come into balance. If house prices start to fall then why would a landlord rent at a loss? The only reason thats done now is a gamble on making a return on capital. If that goes away surely renters should expect to pay the cost of owner + a return. So then it's cheaper to buy and the cycle stats again....
No brainer to get in at the bottom if you can - but good luck getting the timing right....
For us - we bought last year, and yes it was probably at the so called top of the market - but you know what, who cares - thats life. We love our house, didn't over stretch, and were sensible in our budgeting. On the upside our mortgage is now stupidly cheap (at a rate we wouldn't be able to get now), and in the past year I've done a lot of renovating to get the place how we'd like it. In a rented property I wouldn't have bothered.
Sure if we'd have waited a year we might have been able to pick something up a little cheaper, however life is not all about waiting around. I view our place as a home first and an investment second. Now we're in the market, I don't care what prices do - in fact if they come down a little in the next five years it'll actually make trading up a little easier (less gap in price, less transaction fees etc) so bring it on.
As for renting - it's great for flexibility and the cost for renting a condo d/town looks like a bargain compared to buying. But surely things will come into balance. If house prices start to fall then why would a landlord rent at a loss? The only reason thats done now is a gamble on making a return on capital. If that goes away surely renters should expect to pay the cost of owner + a return. So then it's cheaper to buy and the cycle stats again....
No brainer to get in at the bottom if you can - but good luck getting the timing right....
Aug 11th 2009, 5:10 pm
#101
Joined: Dec 2008
Posts: 3,054
Re: buying a house in an economic minefield
If you took the time to read the previous posts with a less critical eye, you would notice that we have said much the same thing - major point being that houses are homes and not investment vehicles....
Moreover, the balance to which rob references is not here yet, when that will be I don't know.
Everyone's situation is unique - some have families, some don't, some see homes as stability, pride of ownership, freedom etc, some view them as commodities to endlessly reno and flip. Some have large down payments, some don't, some earn a good wage, others don't.
The recurring point here is that those getting their feet on the first rung of homeownership in this market may find it a lot more slippery that you or I did in a balanced market. We are in a bubble = bubbles deflate. Not an issue if you are secure in your life, your home is affordable and you plan on staying put for an extended period - but not all are in this position, some are dangerously leverged and home ownership for them can lead to financial ruin, stess, and misery. Take a look south at the American dream.
We are also entering into a completely different world as far as our relationship with money goes - i for one hope and pray that we can take a leaf out of our parent's books and don't spend what you don't have - simple.
Moreover, the balance to which rob references is not here yet, when that will be I don't know.
Everyone's situation is unique - some have families, some don't, some see homes as stability, pride of ownership, freedom etc, some view them as commodities to endlessly reno and flip. Some have large down payments, some don't, some earn a good wage, others don't.
The recurring point here is that those getting their feet on the first rung of homeownership in this market may find it a lot more slippery that you or I did in a balanced market. We are in a bubble = bubbles deflate. Not an issue if you are secure in your life, your home is affordable and you plan on staying put for an extended period - but not all are in this position, some are dangerously leverged and home ownership for them can lead to financial ruin, stess, and misery. Take a look south at the American dream.
We are also entering into a completely different world as far as our relationship with money goes - i for one hope and pray that we can take a leaf out of our parent's books and don't spend what you don't have - simple.
Last edited by dboy; Aug 11th 2009 at 5:14 pm.
Aug 11th 2009, 5:25 pm
#103
Joined: Dec 2008
Posts: 3,054
Re: buying a house in an economic minefield
Homes can be a sound financial decision - but when people view them simply in that vein.......
Also if you would take the time to read this thread, you would notice that we are talking about those making the leap now. Should they or should n't they - short answer - it depends.
Aug 11th 2009, 5:35 pm
#104
BE Enthusiast
Joined: Oct 2002
Location: Ottawa, Canada
Posts: 556
Re: buying a house in an economic minefield
If you took the time to read the previous posts with a less critical eye, you would notice that we have said much the same thing - major point being that houses are homes and not investment vehicles....
Moreover, the balance to which rob references is not here yet, when that will be I don't know.
Everyone's situation is unique - some have families, some don't, some see homes as stability, pride of ownership, freedom etc, some view them as commodities to endlessly reno and flip. Some have large down payments, some don't, some earn a good wage, others don't.
The recurring point here is that those getting their feet on the first rung of homeownership in this market may find it a lot more slippery that you or I did in a balanced market. We are in a bubble = bubbles deflate. Not an issue if you are secure in your life, your home is affordable and you plan on staying put for an extended period - but not all are in this position, some are dangerously leverged and home ownership for them can lead to financial ruin, stess, and misery. Take a look south at the American dream.
We are also entering into a completely different world as far as our relationship with money goes - i for one hope and pray that we can take a leaf out of our parent's books and don't spend what you don't have - simple.
Moreover, the balance to which rob references is not here yet, when that will be I don't know.
Everyone's situation is unique - some have families, some don't, some see homes as stability, pride of ownership, freedom etc, some view them as commodities to endlessly reno and flip. Some have large down payments, some don't, some earn a good wage, others don't.
The recurring point here is that those getting their feet on the first rung of homeownership in this market may find it a lot more slippery that you or I did in a balanced market. We are in a bubble = bubbles deflate. Not an issue if you are secure in your life, your home is affordable and you plan on staying put for an extended period - but not all are in this position, some are dangerously leverged and home ownership for them can lead to financial ruin, stess, and misery. Take a look south at the American dream.
We are also entering into a completely different world as far as our relationship with money goes - i for one hope and pray that we can take a leaf out of our parent's books and don't spend what you don't have - simple.
I bought my first house on a 5% deposit (100 pounds) and had a 90% mortgage at 7%. I unlike many of my peers at the time I chose to buy a house rather than a car and rent council houses.
Yes to buy a house and particularly your first has always been a tough decision. But if you are interested in bringing up a family in a stable lifestyle it's worth that initial sacrifice. Over the 48 years of owning houses both here in Canada and the UK I have never been restricted when it comes to mobility.
I'm glad to say that my eldest grandson bought his first property 2 years ago in downtown Ottawa and as he is a pilot for the UN he is only home for approx 40% of the year and rents out to a friend, which pays the mortgage. For the most part renting is for the poor or those seeking temporary accomodation.
Aug 11th 2009, 5:39 pm
#105
Joined: Dec 2008
Posts: 3,054
Re: buying a house in an economic minefield
For the most part renting is for the poor or those seeking temporary accomodation.[/QUOTE]
What total hogwash....................
What total hogwash....................