Vancouver's Real Estate Market

[UFO]

Whats the official determination for a townhouse vs a townhome? Back in the day I had always thought of a townhouse as a row home type, 1500sf+. When we were in the market about 7 years ago, it seemed like townhomes were a thing, basically a bit bigger than condos at the time with at least 2br, but not uncommon to see a 800-900sf 2br townhome on the ground floor and 500-600sf condos on the 2nd-3rd floors with the newer builds; our old 1br condo was 820sf for reference.

Originally Posted by kr4l

My brother paid just over 1mil for his townhouse. I think it’s on heritage mountain. Close to the elementary and secondary school for his kids

For those types of townhouses, I think of it as essentially a house with a shared wall and community coordinated services that your strata fee pays into. 2000+ sf, quite new, high end family oriented neighbourhood, excellent schools. You can't touch that feature set anywhere in Vancouver/Burnaby/Richmond without spending at least another 500-750k if not more. So the tradeoff is you live in a 'townhouse' and pay a monthly strata fee. No brainer for younger-ish families especially if work is in the area, IMO of course. With how Vancouver proper has evolved, I'd take living in this townhouse on Heritage Mountain over an East Van special any day of the week 365 days a year (and I grew up in an East Van special)

Originally Posted by Hondaracer

When I hear “I bought a townhouse because I don’t want a tenant”

To me that means, instead of being able to hand pick potentially 1 neighbor. Your rolling the dice on two or more you have absolutely no control over.

If you own a detached with a suite, you still have your adjoining neighbours plus their own tenants to worry about. Having to deal with tenants is work in and of itself, even the good ones. You get a bad one...

I think its also about not having to rely on your rental suite to make mortgage payments. So you don't own a detached property, but deal with less hassle and have more flexibility with the money you presumably saved

[Hondaracer]

A suite VS paying strata is like a $18,000 a year swing into the red..

Talking like a detached neighbor is similar to two neighbors that you share 2 sheets or drywall with is insane. Like that mentality of choosing a townhome over a detached in a similar pricing scheme is completely insane to me, financially it makes zero sense.

I’ll dig up some pictures of the construction of these townhomes..personally I’d take living in a concrete high rise over a townhome more often than not knowing what I know and seeing the arrangements I have in these developments.

Imo if all things are equal and a detached with a suite is 100-200k more than a townhome (regardless of age really, you deal with the home) you are absolutely insane to not take the detached money maker. It makes zero sense long term to dump literally a hundred grand into strata fees over the term of ownership as opposed to making a hundred k in the first 4-5 years of rental income.

[Ludepower]

Land is king.
Much more room for a detach to start running up in price again or if a developer comes knocking on your door for a 3x buyout.
But I'm just dreaming...no way I can make the jump to a detach.

[Hondaracer]

A detached will also always fetch you more rental income than a townhome would if you had to rent the entire home out.

[Gerbs]

How do we make the jump to detached ^

[Hondaracer]

Obviously it probably isn’t happening. But that discussion of when both are within 100k or so for those “higher end” townhomes its a relevant discussion.

[Nabatron]

That's the thing the wife and I are flip flopping around with. Buying a detached home with potential of having a suite or buying a place with finished basement without at a suite.

breaking it down with pros and cons of each.

the house we are looking at is massive square footage with big back yard and upscale finishes throughout. Finished basement which is hard to find in Kelowna brand new. Downside doesn't have a suite for mortgage helper.

Other places we looked at not as nice and no real back yard well not as big as the one without a suite in the basement. Unfinished basement and overall not as nice of a house. Price range for both places close to the same with us finishing the basement.

What I'm flopping around with is that do we go with a place with unfinished basement with we turn into a mortgage helper or do we go with the house that has finished basement already and no suite but overall is way nicer then anything we have seen so far.

The thing I am not to keen on is finding a renter or using it as an BnB to people we don't know. With people living below us I am not really excited about that kind of like living in a townhome again but getting income from them lol.

decisions decisions...

[Hondaracer]

If you were to build you could position the living arrangement in a way that is best for both parties. Ie. Bedrooms under lesser used spaces etc.

Also could use sound deadening materials such as insulation and drywall in bedrooms to make it as quiet as possible.

I think people are underestimating how easy it is to get a great tenant when rentals are so hard to come by, especially with a brand new suite. You can charge high prices and throw in virtually any addendum you want to feel secure with your tenant.

Then by higher rents and the lack of rentals you can hand pick and screen through dozens of tenants until you find the right one. It’s not just like you’re forced to take some crack head.

[Traum]

Originally Posted by UFO

For those types of townhouses, I think of it as essentially a house with a shared wall and community coordinated services that your strata fee pays into.

For me at least, this is pretty much the only benefit I see in a large townhouse. Strata is there to take care of "stuff". For someone who has no mechanical skills / too busy / not interested in home DIY stuff, the strata fee is the price you pay to have someone else (ie. the strata council) take care of all the dirty work for you.

As I have probably said many times in the past, the strata council at my building is very, very good. With the wifey and I already killing ourselves from work and stuff, we totally appreciate not having to worry about maintenance and fixing stuff when things break. Comparing that to my BIL, who is basically following the model that Hondaracer described, they are certainly bringing in more money to help with things, but looking after the house and the tenant on top of looking after his family all adds up to a crazy amount of work. In that regard, I do not envy him at all.

At the end of the day, I'd still prefer detached over strata though.

[XSSIV]

I got a quote on pre-purchasing some townhouses - $975k.

I checked again yesterday (a couple months later), down to $845k.

hmmmmm

[MarkyMark]

Originally Posted by Gerbs

How do we make the jump to detached ^

Inherit one.

[Sw0op]

Originally Posted by Nabatron

That's the thing the wife and I are flip flopping around with. Buying a detached home with potential of having a suite or buying a place with finished basement without at a suite.

breaking it down with pros and cons of each.

the house we are looking at is massive square footage with big back yard and upscale finishes throughout. Finished basement which is hard to find in Kelowna brand new. Downside doesn't have a suite for mortgage helper.

Other places we looked at not as nice and no real back yard well not as big as the one without a suite in the basement. Unfinished basement and overall not as nice of a house. Price range for both places close to the same with us finishing the basement.

What I'm flopping around with is that do we go with a place with unfinished basement with we turn into a mortgage helper or do we go with the house that has finished basement already and no suite but overall is way nicer then anything we have seen so far.

The thing I am not to keen on is finding a renter or using it as an BnB to people we don't know. With people living below us I am not really excited about that kind of like living in a townhome again but getting income from them lol.

decisions decisions...

you should figure out if you plan on living in that house forever and if you need the extra rental income to support your lifestyle/retirement/mortgage. if you don't need the income, then go with the massive house but if you do ever decide to sell it good luck with that unless prices drop down dramatically. I've seen some 3 storey homes in the lower mainland not designated for a suite downstairs and you know for sure they're either gonna sit on the market for a loooooooooooong time or they'll have to take a massive haircut on their asking price...with high prices these days, people want the extra rental suite in case they need to the rental $$

re: renting
it's not really that bad..for sure you will get one bad apple and it will sour your experience but you'll get to pick and choose for the most part. We rented our place twice over the past 2.5 years...the first time there were just so many inquiries we had to up the price twice..it was ridiculous...the second time I think we had like 80 inquiries over the span of 1.5 weeks...the first time we were admittedly slightly underpriced but the 2nd time we thought we were fair value if not even on the high side...you'll for sure get to meet some interesting people...there are a few where you know it won't be a good fit though

[lowside67]

Originally Posted by XSSIV

I got a quote on pre-purchasing some townhouses - $975k.

I checked again yesterday (a couple months later), down to $845k.

hmmmmm

Whereabouts is this? That's a big move!

-Mark

[Liquid_o2]

Originally Posted by XSSIV

I got a quote on pre-purchasing some townhouses - $975k.

I checked again yesterday (a couple months later), down to $845k.

hmmmmm

Echoing lowside67... location or project name?

[DA9ve]

Originally Posted by Sw0op

you should figure out if you plan on living in that house forever and if you need the extra rental income to support your lifestyle/retirement/mortgage. if you don't need the income, then go with the massive house but if you do ever decide to sell it good luck with that unless prices drop down dramatically. I've seen some 3 storey homes in the lower mainland not designated for a suite downstairs and you know for sure they're either gonna sit on the market for a loooooooooooong time or they'll have to take a massive haircut on their asking price...with high prices these days, people want the extra rental suite in case they need to the rental $$

re: renting
it's not really that bad..for sure you will get one bad apple and it will sour your experience but you'll get to pick and choose for the most part. We rented our place twice over the past 2.5 years...the first time there were just so many inquiries we had to up the price twice..it was ridiculous...the second time I think we had like 80 inquiries over the span of 1.5 weeks...the first time we were admittedly slightly underpriced but the 2nd time we thought we were fair value if not even on the high side...you'll for sure get to meet some interesting people...there are a few where you know it won't be a good fit though

do you mind mentioning the price difference? i will be on the same boat soon and have just begun researching about tenants and rates.

[Sw0op]

Originally Posted by DA9ve

do you mind mentioning the price difference? i will be on the same boat soon and have just begun researching about tenants and rates.

not sure sorry..check with a realtor?

[kula]

I'm wondering, how well do townhouses hold their value over time? For boomers cashing out, those who are selling off their bungalow or Van Special are still getting good money, but I don't know of anyone selling off a townhouse. Looking at the assessment, it's mainly land value for the detached properties and the building is worth close to nothing. I know it's impossible to know what the future holds, but I wonder how much a well-loved townhouse will be worth in 20-30 years vs detached in east van.

I'm a huge fan of detached properties myself but understand the headaches of owning a crappy old rental house in Vancouver. It's like having a side job where you can get called at any time and don't get paid. Sometimes I have to take time off work to be present when things are getting fixed. I can see why people are reluctant to do it.

[Hondaracer]

Boomers selling detached and buying a townhome = forced to sell quickly when they realize they can’t handle 2 flights of stairs every day.

Seen it happen a million times. Sometimes even before the project is done

[Acurapinoy]

Originally Posted by XSSIV

I got a quote on pre-purchasing some townhouses - $975k.

I checked again yesterday (a couple months later), down to $845k.

hmmmmm

Ya. That's a big jump but pending the location..... Asking 975 from the get go for a townhome is a reach... Hell even at 845 that's a lot haha. Could've been a ploy to show buyers they are getting a steal but really this is the true price point haha

[twitchyzero]

dilemma on an investment piece... close on time or change lenders?

currently approved for a portfolio 7/1 adjustable with 50% down for 360 mos...ordering appraisal soon and closing in 3 weeks

opened an account elsewhere and they were able to offer the same product for 1.38% lower...everything else basically apple-to-apples...but i haven't gone through the underwriting

changing means we would have to get an agreement from seller to delay by at least another 2 weeks...which might cast doubt for the seller (but they are not contingent on another home)...and I'm away that week

I originally didn't care much for the high interest rate because i'm not really paying the mortgage and begger can't be chooser without a credit history south of the border...but now with another option and I can save $200/mo?

just less stress and risk if I go with the original plan and that's what my realtor is biased towards

edit: asked the original lender to retain me at the competitor's rate...price match got shot down lol

background: sellers' market, pending at 5.5% over ask, seller deducted 2.25% after inspection w/o any fuss (not the one I posted few pages back)

[Traum]

I know nothing about how US mortgages work, so I am purely bs-ing here, and treating it as a Canadian mortgage.

If it is a Canadian variable rate mortgage, I think the A lenders typically allow the borrower to terminate the mortgage by paying 3 months' worth of interest. With a rate that is 1.38% cheaper, I'd run the math and see the savings for switching could justify the interest penalty. Over a 5 year term, I think you should be coming out ahead by switching?

Saving $200/month seems pretty significant to me.

[Nabatron]

judgement day is today!!!!!!!!!!!!

[Mr.HappySilp]

Good Luck!

[twitchyzero]

Originally Posted by Traum

I know nothing about how US mortgages work, so I am purely bs-ing here, and treating it as a Canadian mortgage.

If it is a Canadian variable rate mortgage, I think the A lenders typically allow the borrower to terminate the mortgage by paying 3 months' worth of interest. With a rate that is 1.38% cheaper, I'd run the math and see the savings for switching could justify the interest penalty. Over a 5 year term, I think you should be coming out ahead by switching?

Saving $200/month seems pretty significant to me.

refinancing wiith a different lender, don't you have to pay title again? what about appraisal and origination fee?

[Energy]

Yes, if you're refinancing you need to discharge the old mortgage and register the new mortgage on title which involves some legal fees. Not sure about how that works in the US though.