Property prices - Vancouver
May 20th 2009, 8:24 am
#31
Just Joined
Joined: May 2009
Location: Brazil heading for Vancouver
Posts: 17
Re: Property prices - Vancouver
Your friend has a good deal, but not one he'd find in a major city. As this link
http://www.globalpropertyguide.com/E.../Rental-Yields
shows, rents are 2-3X higher than that in the cities.
My feeling is that there is a strong direct or passed down memory of the hyperinflation in the 20's and 30's. People understand that large numbers of zeros on the price of a house (or a loaf of bread) are not particularly desirable.
http://www.globalpropertyguide.com/E.../Rental-Yields
shows, rents are 2-3X higher than that in the cities.
My feeling is that there is a strong direct or passed down memory of the hyperinflation in the 20's and 30's. People understand that large numbers of zeros on the price of a house (or a loaf of bread) are not particularly desirable.
UK citizen's memory of the UK house price crashes of the late 70's, the early 80's and the mid 90's has not stabilised the UK market. I am not at all convinced that memories of what happened to their grandparents is all that it takes in Germany. Brazilians have far more current memories of hyper-inflation than Germans and yet are currently experiencing house price inflation.
The argument I laid out explains the German situation and it doesn't rely on self-control.
May 20th 2009, 9:29 am
#32
RETIRED Realtor
Joined: Aug 2006
Location: Winnipeg, Manitoba
Posts: 2,087
Re: Property prices - Vancouver
The site offers a basic insight into rents in Germany yet it demonstrates exactly the point I made... they are cheap.
UK citizen's memory of the UK house price crashes of the late 70's, the early 80's and the mid 90's has not stabilised the UK market. I am not at all convinced that memories of what happened to their grandparents is all that it takes in Germany. Brazilians have far more current memories of hyper-inflation than Germans and yet are currently experiencing house price inflation.
UK citizen's memory of the UK house price crashes of the late 70's, the early 80's and the mid 90's has not stabilised the UK market. I am not at all convinced that memories of what happened to their grandparents is all that it takes in Germany. Brazilians have far more current memories of hyper-inflation than Germans and yet are currently experiencing house price inflation.
British House prices have risen steadily since 1945, despite some ups and downs, they have proven to be a good investment, as well as a place to live.
The important line above is "a place to live" most British people prefer to own their own home, so that they can alter it to suite both their tastes and their life styles, something you can not do with a rented property.
If in achieving those goals, they may also either make a profit from the eventual sale of the home and them downsizing, or have considerably less outgoing when their mortgage is paid off, this too makes them happier than if they had rented their whole lives.
May 20th 2009, 10:07 am
#33
Just Joined
Joined: May 2009
Location: Brazil heading for Vancouver
Posts: 17
Re: Property prices - Vancouver
However, Canadian mortgage lenders are very strictly regulated. In the last ten years you simply could not get a mortgage if the payments exceeded 32% of your gross income. You could not get a 125% mortgage. If you wanted a loan to value ration of less than 80% you HAD to buy insurance to protect the lender in case of default.
May 20th 2009, 10:08 am
#34
Just Joined
Joined: May 2009
Location: Brazil heading for Vancouver
Posts: 17
Re: Property prices - Vancouver
If you had bought at the very peak before the fall in each of the prior crashes you would still have made a sizable profit from your purchase in the UK market within a few years of that purchase.
British House prices have risen steadily since 1945, despite some ups and downs, they have proven to be a good investment, as well as a place to live.
The important line above is "a place to live" most British people prefer to own their own home, so that they can alter it to suite both their tastes and their life styles, something you can not do with a rented property.
If in achieving those goals, they may also either make a profit from the eventual sale of the home and them downsizing, or have considerably less outgoing when their mortgage is paid off, this too makes them happier than if they had rented their whole lives.
British House prices have risen steadily since 1945, despite some ups and downs, they have proven to be a good investment, as well as a place to live.
The important line above is "a place to live" most British people prefer to own their own home, so that they can alter it to suite both their tastes and their life styles, something you can not do with a rented property.
If in achieving those goals, they may also either make a profit from the eventual sale of the home and them downsizing, or have considerably less outgoing when their mortgage is paid off, this too makes them happier than if they had rented their whole lives.
Last edited by Melmouth; May 20th 2009 at 10:11 am.
May 20th 2009, 10:31 am
#35
Binned by Muderators
Joined: Jul 2007
Location: White Rock BC
Posts: 11,690
Re: Property prices - Vancouver
The 32% of gross income on housing cost restriction has always been there. Wages did not rise significantly, yet house prices did.
Not everyone needs a mortgage.
Last edited by JonboyE; May 20th 2009 at 10:34 am.
May 20th 2009, 10:43 am
#36
slanderer of the innocent
Joined: Dec 2008
Location: Vancouver, BC
Posts: 6,695
Re: Property prices - Vancouver
For our mortgage we had to prove income, put down a certain amount, as JBE said. I have heard of dodgy mortgages but not from reputable canadian banks.
May 20th 2009, 10:57 am
#37
RETIRED Realtor
Joined: Aug 2006
Location: Winnipeg, Manitoba
Posts: 2,087
Re: Property prices - Vancouver
Inflation has been a fact of life for my generation (I'm 51) I know no other way.
What is the alternative to Inflation, Deflation or Stagnation? Are these better?
Personally I have always profited in periods of inflation and had harder times during "stagflation" and stagnation.
May 20th 2009, 2:39 pm
#38
Born again atheist
Joined: Jul 2005
Location: Europe (to be specified).
Posts: 30,259
Re: Property prices - Vancouver
I'm aware of recent Brazilian hyperinflation. If they have forgoten it, (which I seriously doubt), then it seems to strengthen my view that self control is important in the German situation.
Part of the "argument you laid out" hung upon the assertion that German banks were tightly regulated. Simply not true; check out the bank bail outs in the last six months there. They dwarf what's happened in Canada.
