Vancouver's Real Estate Market

[quasi]

Originally Posted by JDMDreams

Ya so it's all cuz you guys qualified with real income, try applying for a new one if you're on gov cpp oas

Yeah, I learned this lesson from a friend of mine and what happened to his family. Single family income, his dad was a machinist hard working blue collar family. He worked for a union outfit and they ended up on a long strike when we were in high school, bank wouldn't help them out even though they owned a house that was mostly paid off because he had no income at the time being on strike.

Get that credit well you have the income before you have issues even if you don't need it you'll have it for an emergency.

[Traum]

For aging parents who are still living in a detached home, wouldn't the most sensible thing to do be downsizing to some sort of strata property that wouldn't require them to do any home maintenance? They get a nice cash infusion from the sale that they can spend on whatever they want. They still own a property so there is no psychological insecurity (from not having a "forever home" themselves).

Way back when I sold my apartment, the buyer was exactly an elderly lady like that. The parents of a good friend of mine also did this many years ago, and whatever amount that remained after purchasing a new apartment, they split it 3 ways, with 1 portion going to the parents, and the remaining 2 portions going to each child that they have in turn used as down payment for their own place, or to pay down their existing mortgage.

[Hondaracer]

Because people would rather live among their garbage in a home they know then even consider leaving that home, even when they have millions in equity.

It’s kind of ironic because this is so prevalent in the Chinese community where “saving face” is so important. I guess living in a crumbling detached home and using the food bank is better than living in a brand new condo and eating actual groceries.

There are numerous ways to pull this equity out of the home in order to survive. It’s not hard. People are just ignorant to those ways and think taking on a loan later in life in order to live comfortably is the end of the world and would rather eat cat food then talk to the bank

[supafamous]

Originally Posted by Traum

For aging parents who are still living in a detached home, wouldn't the most sensible thing to do be downsizing to some sort of strata property that wouldn't require them to do any home maintenance? They get a nice cash infusion from the sale that they can spend on whatever they want. They still own a property so there is no psychological insecurity (from not having a "forever home" themselves).

Yes? Both my parents and in-laws own paid off detached houses in East Van and both have just enough to live on at the moment but both houses are WAY more house than they need but they won't downsize for a variety of reasons:

1. My dad is very attached to the property - it's been in the family for nearly 50 years and the current house was one we built in the 90s (he helped build it too). He also is a busybody handy man so works in his garage all the time, built his own deck, does his own renovation work etc. A condo would take that all away from him despite my mom's strong desire to downsize and pass down some of the money to her two kids sooner rather than later (thanks mom!)

2. It's hard to downsize and stay in the same neighborhood and staying in the same area when you're old is really valuable - learning new routines can be really hard. Even remembering directions to the store become a challenge with age - they become lost much more easily.

3. My MIL (and FIL) aren't financially literate and see a house as the only safe and effective way to pass money down to the kids. They want to hang on to it as long as they can so it's worth as much as possible when they die. They're not wrong due to this market even if I think they could dump it into the stock market or even GICs. With the rezoning that's happening they're even more right.

4. Jesus Fucking Christ they have a lot of junk! 40-50 years of accumulation has meant that crawling out of all that shit will take a couple years and it's a problem no one wants to face. I'm sure there's some stuff in there of value (real money and sentimental) but I'm not sure I wouldn't just get a couple of college kids to haul it all away to the dump just to clear the house out vs taking a month off work sorting through it.

[JDMDreams]

Yes, try saying that to your parents, they see it as one closer step to death, senior home, and even young people once you get the taste of detached, private yard, free space, garage, rent, doing whatever the fuck you want, you're not gonna want to move into a condo and be told what to do, no loud sex, don't smoke or throw your condoms off the balcony. That's why dt is dead and detached is still the grail. And everyone who can afford detached will want it.

[westopher]

Ahh yes the dream of owning a home so I can throw used condoms in my yard. How could anyone consider downsizing?
You're on a fuckin roll lately.

[fsy82]

I bought my current detached house just before it went crazy in 2020 and have quite a bit of equity to go downsize into a 4 bedroom townhouse being mortgage free. but i like having a yard and no strata to deal with.

it really depends on the individual if downsizing is something they can do or want to do.

[supafamous]

Originally Posted by supafamous

2. It's hard to downsize and stay in the same neighborhood and staying in the same area when you're old is really valuable - learning new routines can be really hard. Even remembering directions to the store become a challenge with age - they become lost much more easily.

Took a browse at what my parents could downsize into in their area and it's not great. A 2 bedroom condo in their area runs between $700k-1m like this one: https://www.rew.ca/properties/501340...erty_click=map

That one has a strata fee over $600/mo as well. Most of the options are right on a main road like Kingsway which is a shitty way to live.

They could sell their house for $2m and then spend half of it to buy a 2 bedroom that's less than half the size of their current home and is on a busy road. They'd lose most of their ability to have guests over (the grandkids will have no place to sleepover and they can't host their out of town guests anymore). They lose their deck and their garage and yard.

I mean, unless they're in deep financial trouble or have serious mobility problems, why would they do it?

[JDMDreams]

^^ this, plus detached will still go up in value the quickest and your can rent a portion of it out.

[Great68]

Originally Posted by supafamous

Yes? Both my parents and in-laws own paid off detached houses in East Van and both have just enough to live on at the moment but both houses are WAY more house than they need but they won't downsize for a variety of reasons:

1. My dad is very attached to the property - it's been in the family for nearly 50 years and the current house was one we built in the 90s (he helped build it too). He also is a busybody handy man so works in his garage all the time, built his own deck, does his own renovation work etc. A condo would take that all away from him despite my mom's strong desire to downsize and pass down some of the money to her two kids sooner rather than later (thanks mom!)

2. It's hard to downsize and stay in the same neighborhood and staying in the same area when you're old is really valuable - learning new routines can be really hard. Even remembering directions to the store become a challenge with age - they become lost much more easily.

3. My MIL (and FIL) aren't financially literate and see a house as the only safe and effective way to pass money down to the kids. They want to hang on to it as long as they can so it's worth as much as possible when they die. They're not wrong due to this market even if I think they could dump it into the stock market or even GICs. With the rezoning that's happening they're even more right.

4. Jesus Fucking Christ they have a lot of junk! 40-50 years of accumulation has meant that crawling out of all that shit will take a couple years and it's a problem no one wants to face. I'm sure there's some stuff in there of value (real money and sentimental) but I'm not sure I wouldn't just get a couple of college kids to haul it all away to the dump just to clear the house out vs taking a month off work sorting through it.

This is my parents. I don't see them ever leaving their house unless they become incapable of living on their own. They have deep roots in the area, the house was built by my Grandpa in the 70's, and he sold it to my parents and we moved into it in the 90's.
My dad is like me, he likes to constantly putz around on projects around the house, he's not a "content to do nothing" kind of guy. He could never be happy without proper shop space.
Plus they need the extra space/spare rooms for us when we come over for visits.

Fortunately for them they're OK with money, they're both pensioners, and had additional savings on top of that.

[Hondaracer]

Originally Posted by supafamous

Took a browse at what my parents could downsize into in their area and it's not great. A 2 bedroom condo in their area runs between $700k-1m like this one: https://www.rew.ca/properties/501340...erty_click=map

That one has a strata fee over $600/mo as well. Most of the options are right on a main road like Kingsway which is a shitty way to live.

They could sell their house for $2m and then spend half of it to buy a 2 bedroom that's less than half the size of their current home and is on a busy road. They'd lose most of their ability to have guests over (the grandkids will have no place to sleepover and they can't host their out of town guests anymore). They lose their deck and their garage and yard.

I mean, unless they're in deep financial trouble or have serious mobility problems, why would they do it?

Who says they need to buy anything?

If you sell a detached for 2 million, even with zero retirement savings, if you put away 1.5 of that and made a modest 6-7% return you’d be coming out ahead even if you were paying $3000 a month or more in rent.

That type of move would also enable a huge lifestyle change for a lot of people. But again, so many people would rather live amongst a bunch of junk than travel and spend money on hobbies etc. but so many people on these situations think the stock market is a fools game/scam even though they have zero understanding of it.

I also find the whole concept of being sentimental towards a home a little weird although I’m probably in the minority. My parents have a beautiful home which my dad literally built himself. Not “he helped” or he hired contractors etc. literally every nail, every wire, every peice of this home was constructed by his hands. I grew up in this house as did my parents and siblings, they’ve been there for over 30 years, and have a huge lot, 3600+ sq fr home. However neither of my parents would EVER consider holding onto it simply for the sentimental reasons. It’s a wooden box that holds your shit lol. I’ve felt the same about every place I’ve ever owned.

While I think a lot of people in these situations are just stubborn, ignorant, or both. I think what’s being discussed here regarding a “downsizing” home being so expensive is a big driver to overall lack of inventory and unaffordability. Even 10-15 years ago selling your detached would be a windfall in terms of downsizing, selling a 800k detached and buying a 300k townhome and only losing 15-20% of your living space. Now everything is more expensive and smaller. And when you’ve got piles of shit to bring with you, even the thought of moving is too much for a lot of these people

[68style]

People change with age, you get old and you feel life slipping away and you start clutching everything you have and trying to hang on to it...

It's easy for anyone in their 20's and 30's to be like yah fuck itttt just material shit who cares get another one dispose dispose dispose... but age gives you a different perspective of the world.

[JDMDreams]

Old people will bitch, especially if they are uneducated, stubborn and most old people are. If you had $1500000 at 6% that's $90000 a year. They will bitch that they will have to pay tax on that, lose cpp, oas, gis. Let alone anything happen and the value of the $1.5 drops. 6% is very optimistic, there's no way low risk investments will pay 6% for the next 20 30 years.

[Traum]

For me at least, the biggest motivation to move away from living in a detached home is the freedom from looking after all the maintenance and on-going chores required in a detached home. Old houses are just like old cars, and at any given moment, some stuff will require attention and upkeep. When people get old, they are simply no longer as physically capable of doing all the physical work that needs to be done.

In your dad's case, I'd say that as long as he is still fully capable of looking after the house himself, it'd actually be a good thing for him to keep living there and keeping doing those things. It keeps him busy, and it keeps him active, and that will be good for him both physically and mentally.

For my old man, he is starting to lose that ability to keep up with the upkeep, and the house is starting to show those signs of neglect. My mom and I are trying to pick up the slack, but between looking after my own old shack and all my other adult responsibilities, I am not doing enough to pick up that slack.

But like your dad, my parents have been living in the same house pretty much ever since we moved to Canada. They are definitely settled and comfortable in our neighbourhood, but there are a few nearby options if they were to move into a strata property setting. But then again, we'll have to go through the same junk collection & clean up problem as you and many other older parents have. I am partly guilty of contributing to that junk pile too because I still have some of my old junk in my parents' basement LOL~

Originally Posted by supafamous

Yes? Both my parents and in-laws own paid off detached houses in East Van and both have just enough to live on at the moment but both houses are WAY more house than they need but they won't downsize for a variety of reasons:

1. My dad is very attached to the property - it's been in the family for nearly 50 years and the current house was one we built in the 90s (he helped build it too). He also is a busybody handy man so works in his garage all the time, built his own deck, does his own renovation work etc. A condo would take that all away from him despite my mom's strong desire to downsize and pass down some of the money to her two kids sooner rather than later (thanks mom!)

2. It's hard to downsize and stay in the same neighborhood and staying in the same area when you're old is really valuable - learning new routines can be really hard. Even remembering directions to the store become a challenge with age - they become lost much more easily.

3. My MIL (and FIL) aren't financially literate and see a house as the only safe and effective way to pass money down to the kids. They want to hang on to it as long as they can so it's worth as much as possible when they die. They're not wrong due to this market even if I think they could dump it into the stock market or even GICs. With the rezoning that's happening they're even more right.

4. Jesus Fucking Christ they have a lot of junk! 40-50 years of accumulation has meant that crawling out of all that shit will take a couple years and it's a problem no one wants to face. I'm sure there's some stuff in there of value (real money and sentimental) but I'm not sure I wouldn't just get a couple of college kids to haul it all away to the dump just to clear the house out vs taking a month off work sorting through it.

[supafamous]

Originally Posted by Hondaracer

Who says they need to buy anything?

If you sell a detached for 2 million, even with zero retirement savings, if you put away 1.5 of that and made a modest 6-7% return you’d be coming out ahead even if you were paying $3000 a month or more in rent.

Renting is even worse than downsizing though - the selection is even worse than what you can buy and you're at the mercy of landlords who evict at twice the rate of any other region in Canada (you basically have a 1 in 6 chance of being evicted each year in Vancouver). People on fixed incomes can't afford the risk of being evicted in this kind of rental market. In my parents neck of the woods there's all of one 2 bedroom unit near them and it's $3k, the rest are 1 bedrooms that go for $2300-2700. What landlord is going to pick the elderly couple on a fixed income?

And a 6-7% return when someone is retired is a highly risky investment - at end of life it's more like a 4% dividend fund if even that. Meanwhile that detached house they sold goes up in value 10% a year.

Originally Posted by Hondaracer

That type of move would also enable a huge lifestyle change for a lot of people. But again, so many people would rather live amongst a bunch of junk than travel and spend money on hobbies etc. but so many people on these situations think the stock market is a fools game/scam even though they have zero understanding of it.

I think there's a sweet spot where the lifestyle change makes a difference - you have to be at an age where you still have the health and energy to enjoy the lifestyle of traveling, spending on hobbies etc. My parents are just at the outer edge of that now - my dad tires easily and bumbling around the house and buying dumb shit on FB is about all he can handle now. The time to enjoy his real estate wealth was 10-15 years ago but he was still working then.

[Hondaracer]

I’d rent to a senior that showed me a blank slip with 1.5 mill in the bank tomorrow. Sounds like the perfect tenant lol

[PeanutButter]

Originally Posted by JDMDreams

^^ tell me which magic lender this is, as far as I know no one lends on equity any more unless it's some private loan shark lender. If this was true everyone can just take out money and drive up property prices even more.

Ok fair enough, you may be right about the new loan.

My grandma had an existing HELOC about $100k and she got it increased to $250,000 ~five years ago and she didn't have any income, only CPP and OAS. At the time the house was paid off and it was worth $1.5M. She was with RBC.

edit. You know what. I'm going to assume my uncle may have guaranteed the loan as he needed the money and he was working full time, so that could be why she got the increase with no income?

[PeanutButter]

LOL my mom told me not to throw any of her clothes away before checking the pockets for money. She used to put money in the clothing and other random places in the house and now she can't remember where she put it.

She will randomly find money places to this day.. So she told me when they pass make sure we go through everything unless we want to throw money away.

[JDMDreams]

I think the best scenario might be rent out portion or all of a house, then rent or buy an apartment, use the rental as income or pay for the new place.

That's if you're rich enough to own detach, I guess too bad for seniors in town house or already in an apartment.

[supafamous]

Originally Posted by JDMDreams

I think the best scenario might be rent out portion or all of a house, then rent or buy an apartment, use the rental as income or pay for the new place.

That's if you're rich enough to own detach, I guess too bad for seniors in town house or already in an apartment.

Owning detached is a rich getting richer scenario nowadays. The land goes up in value faster than condos and townhouses and you can subsidize your mortgage with a rental suite (or 2 or 3) so that you end up paying less on your mortgage than you would if you had a townhouse and that's not even counting the strata fees. Sure, some people don't want to be landlords but you end up well ahead of buying a townhouse (if you can somehow swing the downpayment and have the income).

[donk.]

Originally Posted by Hondaracer

I’d rent to a senior that showed me a blank slip with 1.5 mill in the bank tomorrow. Sounds like the perfect tenant lol

This is it, my buddy posted his 1 bed for rent, had 6 people apply, the one he picked was an international retiree from Europe, that showed him 800k in savings.

[Twi7ch]

Originally Posted by Hondaracer

I’d rent to a senior that showed me a blank slip with 1.5 mill in the bank tomorrow. Sounds like the perfect tenant lol

Can confirm, renting a condo to a sweet old lady (88 now). She's been renting from us for 4 years and from the sounds of it plans to rent there until she no longer can. She sold a property in Chilliwack and showed us her bank statement, money won't be an issue. And because she's reliable we don't plan on increasing her rent ever.

Sent from my Pixel 5 using Tapatalk

[sonick]

Originally Posted by supafamous

my dad tires easily and bumbling around the house and buying dumb shit on FB is about all he can handle now.

LMAO I thought this was just my dad, is this a common thing old people do?!

[68style]

Any of you guys have experience with building drainage?

Starting about a year and a bit ago... a couple of first floor units in my building flooded. Huge insurance claims. The blame was from the strata not the units, backed up drainage pipes in the parkade supposedly was the cause... they started bringing in companies to come in and do some kind of cleaning thing on the sink drains, etc.

Through the woodwork I heard about 1 other unit flooded. 1 of them was so bad the people didn't live in it for almost a year and the entire unit was rebuilt inside basically.

Fast forward to yesterday night, hear lots of commotion outside... and 2 units near me, 1 unit away and then the one next to them... they're all running around with buckets... residents tell me that suddenly the bathtub and toilets just started filling up with water and overflowing, can't stop it even turning the water off. Obviously there's more problems than just the kitchen sinks.

I'm sitting here 1 unit over and nothing happened here, but I'm like fuck am I next? Has anyone ever heard of this before? Ironically like 1 hour before this happened I was sitting here calculating how much I could rent my place for if I moved out and whether it was worth it to do that or just sell the place and definitely leaning toward renting it... but wow this definitely gives me pause.

[unit]

this kinda shit scares the shit outta me with condos.
in my building the second tower had a leak last year that affected several units and jacked up everyones insurance premiums. it wasn't the tenants fault either, it was faulty heat pump connections in the units. trying to resell that unit later would definitely have to be at a discount if there was significant damage, even if it were fixed.