Relocate to Vancouver and need help!!!

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Re: Relocate to Vancouver and need help!!!

Postby timber2012 » Tue Nov 27, 2012 11:40 am

instigator wrote:also factor in how many years suffering and waiting. you are betting on prices to drop significantly but how much do you really think? how much drop does it take?. again, why didn't they buy in 2008?

there's a good chance prices will keep steady or even increase due to population increase, pent up demand and low increase rates for as far as we can see.


wow - it's like instigator has the entire Real Estate rolodex while typing his responses.

When prompted for some numbers backing up their crazy claim, the response has turned to:

"pride of ownership", "pent up demand", "population increase", "get in while you can", "equity gains of paying down principal"...

c'mon instigator - almost at double digits! LOL
George Carlin once said "Think of how stupid the average person is, and realize half of them are stupider than that.”
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Re: Relocate to Vancouver and need help!!!

Postby instigator » Tue Nov 27, 2012 12:16 pm

it all depends on the product, time frame. hard numbers don't matter, every circumstance is different. properties are in different conditions and have different value. When one home drops in price another home may not drop much or at all. everything doesn't all move together in unison.

it's not like someone projecting prices to drop 30% and all properties will.
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Re: Relocate to Vancouver and need help!!!

Postby BCAccountant » Tue Nov 27, 2012 12:23 pm

instigator wrote:also factor in how many years suffering and waiting. you are betting on prices to drop significantly but how much do you really think? how much drop does it take?. again, why didn't they buy in 2008? because they got greedy thinking it would go down more. same thing now but will it go back down to 2008 levels? no one knows but would you buy if it did? If so then you just wasted 5 years.

there's a good chance prices will keep steady or even increase due to population increase, pent up demand and low increase rates for as far as we can see.


Not sure why renting has to include suffering and not sure what someone has wasted 5 years on if you rent instead of buy. Both renting and buying include positives and negatives, so go ahead and outline the intangible reasons to buy but it seems irresponsible and incorrect to flippantly state that there is no savings to renting in the current market. I agree with Geyser that your numbers don't add up.

Some people put more importance on intangibles and other on finances.... there is nothing wrong with either as long as you go into it with eyes wide open.
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Re: Relocate to Vancouver and need help!!!

Postby gobigorgohome » Tue Nov 27, 2012 12:54 pm

BCAccountant wrote:
Not sure why renting has to include suffering and not sure what someone has wasted 5 years on if you rent instead of buy.



I think it has to do with the fact that the sooner you buy, the sooner you'll be mortgage free, and then the sooner you can retire/diversify your time with minimal monthly fixed costs.

If I had bought when I was 20, I would likely be mortgage free right now. In 10 years, I'll likely be glad I bought when I did (last year), as opposed to waiting an additional 5 years.
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Re: Relocate to Vancouver and need help!!!

Postby HAM » Tue Nov 27, 2012 1:01 pm

gobigorgohome wrote:
BCAccountant wrote:
Not sure why renting has to include suffering and not sure what someone has wasted 5 years on if you rent instead of buy.



I think it has to do with the fact that the sooner you buy, the sooner you'll be mortgage free, and then the sooner you can retire/diversify your time with minimal monthly fixed costs.

If I had bought when I was 20, I would likely be mortgage free right now. In 10 years, I'll likely be glad I bought when I did (last year), as opposed to waiting an additional 5 years.


10 years ago homes were 50% or more cheaper. Let's see you do that now. And in a world where interest rates have no where but to move up. You just answered yourself, it's all about timing.
So jimmy said I missed the dip in Richmond last year. And now prices have fallen even more with no balance in sight! The poor old man is just too old and grumpy!
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Re: Relocate to Vancouver and need help!!!

Postby gobigorgohome » Tue Nov 27, 2012 1:25 pm

HAM wrote:
gobigorgohome wrote:
BCAccountant wrote:
Not sure why renting has to include suffering and not sure what someone has wasted 5 years on if you rent instead of buy.



I think it has to do with the fact that the sooner you buy, the sooner you'll be mortgage free, and then the sooner you can retire/diversify your time with minimal monthly fixed costs.

If I had bought when I was 20, I would likely be mortgage free right now. In 10 years, I'll likely be glad I bought when I did (last year), as opposed to waiting an additional 5 years.


10 years ago homes were 50% or more cheaper. Let's see you do that now. And in a world where interest rates have no where but to move up. You just answered yourself, it's all about timing.



Instead of timing, I think what has happened is the debasement of currency and the relative decline of our standard of living. These are things we can't change.

Indeed, the times of single income households are not going to return, and interest rates could very well stay low (below 4%) for the next 10-15 years. They have been low in Japan since the early 1990s after all. The most bullish case for Real Estate would actually be organic economic growth spurring higher rates - the only real reason I could see a rate move coming anytime soon.

And yes, a duel income family can still pay off a mortgage in 10-12 years by buying in Langley, Maple Ridge, Pitt Meadows etc. And the sooner they do so, the sooner they can live for the following 40-50 years mortgage free.

Show me anywhere post ww2 in Canada where people in a city who bought and held for 10 years are sitting on negative appreciation. If you can do that, I'll be forced to reconsider my argument.
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Re: Relocate to Vancouver and need help!!!

Postby timber2012 » Tue Nov 27, 2012 1:26 pm

1982 - 1992 Vancouver?
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Re: Relocate to Vancouver and need help!!!

Postby fishguy15 » Tue Nov 27, 2012 1:35 pm

gobigorgohome wrote:And yes, a duel income family can still pay off a mortgage in 10-12 years by buying in Langley, Maple Ridge, Pitt Meadows etc. And the sooner they do so, the sooner they can live for the following 40-50 years mortgage free.

Show me anywhere post ww2 in Canada where people in a city who bought and held for 10 years are sitting on negative appreciation. If you can do that, I'll be forced to reconsider my argument.


Both Maple Ridge (-3.7%) and Pitt Meadows (-2.3%) are negative over the last five years according to the HPI. That doesn't look good for your ten year time frame considering what is on the immediate horizon.
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Re: Relocate to Vancouver and need help!!!

Postby gobigorgohome » Tue Nov 27, 2012 1:37 pm

timber2012 wrote:1982 - 1992 Vancouver?


I don't know. The chart I am looking at shows a fairly substantial price increase during that time.

The closest i see is 1994-2004.

And even in that case, if that person had held from 2004-2011, they would have ended up with substantial appreciation (even though they likely bought at the worst possible time)

That's the biggest risk - selling too soon.

If you are buying now, assume the WORST case scenario, and act like its 1994 and hold for 15 years.
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Re: Relocate to Vancouver and need help!!!

Postby eyesthebye » Tue Nov 27, 2012 1:46 pm

timber2012 wrote:
instigator wrote:also factor in how many years suffering and waiting. you are betting on prices to drop significantly but how much do you really think? how much drop does it take?. again, why didn't they buy in 2008?

there's a good chance prices will keep steady or even increase due to population increase, pent up demand and low increase rates for as far as we can see.


wow - it's like instigator has the entire Real Estate rolodex while typing his responses.

When prompted for some numbers backing up their crazy claim, the response has turned to:

"pride of ownership", "pent up demand", "population increase", "get in while you can", "equity gains of paying down principal"...

c'mon instigator - almost at double digits! LOL


we only need population increase from this list - all the other reasons are gravy. More demand = higher prices in the long run. Bank on it.
the cure for higher prices is moving to a destination with lower prices
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Re: Relocate to Vancouver and need help!!!

Postby timber2012 » Tue Nov 27, 2012 1:56 pm

eyesthebye wrote:
timber2012 wrote:wow - it's like instigator has the entire Real Estate rolodex while typing his responses.

When prompted for some numbers backing up their crazy claim, the response has turned to:

"pride of ownership", "pent up demand", "population increase", "get in while you can", "equity gains of paying down principal"...

c'mon instigator - almost at double digits! LOL


we only need population increase from this list - all the other reasons are gravy. More demand = higher prices in the long run. Bank on it.


You're right - that filipino woman serving me timmy's this morning was just saying that her and her janitor husband just moved here to Canada last year and bought a nice house - but she's getting looks from her neighbours and overhearing them calling her a HAM. She's not sure if it's a compliment or not. I just smiled and walked away.
George Carlin once said "Think of how stupid the average person is, and realize half of them are stupider than that.”
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Re: Relocate to Vancouver and need help!!!

Postby BCAccountant » Tue Nov 27, 2012 2:01 pm

gobigorgohome wrote:
BCAccountant wrote:
Not sure why renting has to include suffering and not sure what someone has wasted 5 years on if you rent instead of buy.



I think it has to do with the fact that the sooner you buy, the sooner you'll be mortgage free, and then the sooner you can retire/diversify your time with minimal monthly fixed costs.
If I had bought when I was 20, I would likely be mortgage free right now. In 10 years, I'll likely be glad I bought when I did (last year), as opposed to waiting an additional 5 years.


But that is not true in all markets, it is fairly simple to see what difference waiting 5 years would equate to financially. If the average house price is $550,000 and it goes down by 25% over 5 years, the same house could be purchased for $412,500. Using an interest rate of 5%, a downpayment of $30,000 and ignoring the possibility of a higher downpayment due to renting and waiting, I ran the numbers and the purchaser who waited could make $2525 monthly mortgage payments and have it paid off in 20 years. The purchaser who bought earlier would have to pay $3000 a month for 25 years. Even using $2000 a month in rent, you come out ahead by waiting. Now I realize that it could not drop 25% and/or interest rates could rise, but I think people underestimate the savings of waiting in a down market, it just depends on how much the market drops, at which we can only make guesses.
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Re: Relocate to Vancouver and need help!!!

Postby timber2012 » Tue Nov 27, 2012 2:07 pm

argh - why even bother with those silly things called numbers.

all you need to know is that "Everything is going to be all right". Numbers suck!
George Carlin once said "Think of how stupid the average person is, and realize half of them are stupider than that.”
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Re: Relocate to Vancouver and need help!!!

Postby gobigorgohome » Tue Nov 27, 2012 2:34 pm

BCAccountant wrote:
gobigorgohome wrote:
BCAccountant wrote:
Not sure why renting has to include suffering and not sure what someone has wasted 5 years on if you rent instead of buy.



I think it has to do with the fact that the sooner you buy, the sooner you'll be mortgage free, and then the sooner you can retire/diversify your time with minimal monthly fixed costs.
If I had bought when I was 20, I would likely be mortgage free right now. In 10 years, I'll likely be glad I bought when I did (last year), as opposed to waiting an additional 5 years.


But that is not true in all markets, it is fairly simple to see what difference waiting 5 years would equate to financially. If the average house price is $550,000 and it goes down by 25% over 5 years, the same house could be purchased for $412,500. Using an interest rate of 5%, a downpayment of $30,000 and ignoring the possibility of a higher downpayment due to renting and waiting, I ran the numbers and the purchaser who waited could make $2525 monthly mortgage payments and have it paid off in 20 years. The purchaser who bought earlier would have to pay $3000 a month for 25 years. Even using $2000 a month in rent, you come out ahead by waiting. Now I realize that it could not drop 25% and/or interest rates could rise, but I think people underestimate the savings of waiting in a down market, it just depends on how much the market drops, at which we can only make guesses.



Agreed. While I wouldn't be totally surprised to see prices ticking up next year, I know that one should always assume the worst case scenario:

1) Be prepared to hold for 10-15 years.
2) Buy in an area with a good school catchment, safe environment, near transit and shopping
3) Preferably buy in an area thats totally new. That way, you know your neighbors didn't buy there 25 years ago for 1/10 the price, and won't have any qualms knocking 30-40% off their selling price when they do decide to sell.
4) Don't buy using more than 3X gross annual salary


I'm sure there are more ways that one could minimize risk, but you get the idea.

And regardless of what markets do, I know I'll have it paid off my place in 10-12 years from now and be able to live more or less mortgage free for the next 40+ years....
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Re: Relocate to Vancouver and need help!!!

Postby BCAccountant » Tue Nov 27, 2012 3:20 pm

timber2012 wrote:argh - why even bother with those silly things called numbers.

all you need to know is that "Everything is going to be all right". Numbers suck!


:lol: Don't know what I was thinking!
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