What do u do? I'm really interested to see what ppl do and why they think they deserve to live in 'stylish places'

I'll play on this one. I'm a chef, my wife is a nurse. We pay 1480 a month, and are moving to a house with 2 fenced yards and will be paying 1600 a month, all bills included. The house is divided into 3 but is massive so I'd say our floor space is around 1200 sq ft. Its 100 years old, in good shape and on a bus route in kits. I cringe to think of what 1200 square feet with a yard would cost me in kits per month with 100k or so down payment. We are fairly decently paid for a young couple and I couldn't imagine the lifestyle change if we were to buy something of similar size/quality. No more M3 with new toys for it every month, no more dinners at our favourite restaurants, no more trips to whistler, no more nearly debt free life, (other than my mortgage in edmonton) no more nice clothes, new snowboard gear, etc. I can't comprehend what people believe they can afford in Vancouver. 100k household income does NOT mean a 500k condo is within reach although it seems people are getting into that situation all the time. Being house poor is something I will never allow to happen to me, I enjoy things and doing things way too much.

^ me and my wife just went through the same thing. Looking at selling our condo, putting down $160k on a 628k duplex. Even with that money down we would be looking at $3500-$4000 a month for the mortgage, property tax, insurance, hydro. Once we looked at that hard number we stopped looking and said screw that. We would have to give up going out for dinner 2-3x a week, holidays and pretty much doing whatever we want. For what? A house? Its not a dream anymore to own a house its a nightmare. Ill invest my 160k and make some real money instead of losing it in real estate.

I'll bite.

V1022602, 2795 W 8TH ST, Vancouver, British Columbia V6K2B7

Asking $998000. It is a duplex so the 4200 sqft land isn't all yours.
Say $998000 is the final purchasing price with taxes and fees included. $100K down, you are still borrowing $898000 @ 3.15% for 25 years, you are looking at $4319.16 per month plus property taxes, hydro/tv, and whatever other cost that is included with owning a home in Vancouver.
At the end of the 25 years, if nothing else has changed and interest stays at 3.15%, you would have paid an extra $397,615 in interest plus whatever you would have paid in property tax and other bills.
@$1200 for 25 years, you are looking at $360,000. Assuming a 3% increase per year, then that number will be higher.

I'll play as well in regards to the friends I know.

They are definitely house poor.

They really don't go out for dinners any more.

I have to ask them 6 different times to go out on dinners together, and they reject 5 out of 6 times.

I feel bad when I ask them, but at least we get to get together for house parties, so that balances it.

So, the relationships still flows.

You know, since I bought my place I find myself not going out for nights on the town anymore not because I can't afford it, but because I find working in my garage, basement, or doing many other things around the place way more enjoyable. Plus I like cooking at home.
If a measure of an enjoyable life is by how many times you can go out to dinner, that's pretty laughable.

Have you ever thought that your friends just don't want to go out for dinners so often anymore?

I think its pretty laughable that you took that from the conversation happening here. He's simply using that as an example. I certainly understand the satisfaction of enjoying your home, but its very much a balance. If you were house poor you probably wouldn't have anything in the garage worth working on, right?:)

I think its just called "getting older" ;)

except you'll need to put down $200k instead of $100k like you said, otherwise you'll be paying an additional $20k for mortgage default insurance and at least 4% interest. You also need a combined income of at least $120k-$140k/year to qualify for a mortgage like that

I sure hope it takes A LOT more than 120-140k a year to qualify for that.

you'll qualify with $120-140k if you claim some rental income and dont have much other debt

From CMHC

http://twitter.com/VLAlexander/statu...339136/photo/1

Not sure if real or nominal, but regardless, highest payments whilst we have emergency rates, and a sluggish economy.

I can't imagine this will be pretty in the future. Would love to see the rest of this report/presentation

Another article from Global.
Home sales up nearly 40% in Vancouver-area - BC | Globalnews.ca

this is definitely going to end well when interest rate normalize. idk if the mining industry slowdown is having any impact on the downtown real estate market and vancouver in general. but I just saw a recent stat about half of the TSX venture mining companies are headquartered in Vancouver. with mining in a huge decline and no rebound in the near future this tells me there is going to be a lot of people out of work.

Here's an article from the financial post regarding CHMC. In summary, bank profits are high as heck, and they are not worried about bad debt or mortgage defaults because it's all insured by CMHC. That's right, it's our tax dollars that will bail out these bad loans.





we went from about $50 Billion dollars in insured mortgages by the CMHC in the early 2000's to about $700 billion today. I think the biggest mistake the government did was the 40 year amortization mortgages. That and relaxed lending guidelines such as no income verification and stuff like that.

So for the next 25-40 years (the life of a mortgage), us taxpayers have to be liable for this 700 billion dollars if a catastrophic event happens and real estate values crash. Great, just great.

All so some guy can speculate with 5% down.

Sell porn on the internet and write books


Location determines lifestyle

This is why you probably don't work out, you don't fuck hot chicks, you don't have a sweet car, but you may have a few hundred grand in net worth


Then again, what have you done with your life but saved up? If you're finally a millionaire @ 40 but you did nothing but save up, date a 5, drive a Camry, and your big night out was going to Red Robin and the movies, well, enjoy it I guess!

Hey that kinda sounds like my life years back. Work out less now that i have a family. Had a townhouse in burnaby, and along with the working out that helped me fuck plenty hot chicks, found one i loved and married her, sold the townhouse, bought a house, suppose my net worth is well north of 100k (house poor) traded my sweet ride for a minivan (but i still have the gisxr and its for sale if anyone is interested) and i still enjoy them sauteed shroom burgers!
I admit, i dated some 5's. We've all brought things home we're not too proud of

Sweet! The price of a detached home is now a steal at just over $900k :fuckthatshit:

Would it be wrong to point and laugh at those who are in full tryhard mode to buy property now because status quo?

Jason!

:fullofwin:

Why Vancouver Real Estate is Not Going To Crash | Vancity Buzz | Vancouver Events, News, Food, Lifestyle and More

WHY VANCOUVER REAL ESTATE IS NOT GOING TO CRASH
BY VANCITY BUZZ | 3 HOURS AGO | SPEAK UP




It’s Vancouver’s greatest economic export: telling everyone outside of Vancouver how great it is to live here. It’s even on our license plate (“the greatest place on earth”). No – we’re not arrogant, we just live in a delusional rainy day reality.

The Economics

The definition of a real estate bubble is when the price of an asset rises above what local incomes can afford. It’s that simple. If the locals can’t afford it – then an asset is over priced. How do we gauge if something is too expensive?

Easy – we have historical real estate valuations that are based on the incomes of local residents. The historical national average over a very long period of time is approximately three times income to one. What does this mean in English and not finance talk? It means that if you and your partner make a combined income of $100,000 per year, then the house you should be buying is about $300,000.

This isn’t an exact science – but that sounds about right for affordability doesn’t it? This way you can pay your mortgage, save for your kids college, perhaps take a vacation every year or two, and save for a rainy day.

So here’s the magic question – if the rest of Canadian families are making $100,000 per year and buying $300,000 houses, how much do pay at the greatest place on earth?

Well, let me assure you we’re not making any more money: Vancouver is not a great place for young couples to get ahead (think Calgary, Fort Mac, or Toronto if you want to live somewhere and make good coin). So if a Vancouver couple is making $100,000, the average home they are purchasing is $900,000. These aren’t exact numbers, but give or take $100,000 in either direction and you’re probably about bang on. So what are the implications to this?

If you believe in putting down a 25 per cent down payment you’d have to first save about $225,000 to just for your down payment. That’s nearly the cost of a $300,000 house that everyone else in the country is paying. Comparatively speaking, your mortgage is $450,000 higher with living in Vancouver than somewhere else in the country.

That, ladies and gentlemen, is pure insanity.

Never mind the increased mortgage cost, the real cost is what you pay in interest for borrowing that insane amount of money.

I whipped out my trusty mortgage rate calculator (never leave home without it) and believe with a historical 5% interest rate (with a 25 year mortgage), the amount of interest a Vancouver resident will pay in real dollars is $508,794 (Simple Mortgage Interest Calculator | CalcMyMortgage.com).

I hope you love living in the greatest place on earth is worth giving your retirement, college kids savings, and your first born child to the bank, because that’s basically what it’s costing. The average Vancouver family could literally own three homes if they lived somewhere else.

So now that we’ve already figured out that its completely unaffordable to live in this city, let’s try to determine why.

The Limited Land Argument

From a geographic perspective, Vancouver is unlike most American (and Canadian) cities in the sense that we are surrounded by mountains, water and the international border with the United states. This creates a limited space for the region to build housing for its residents.

It’s simple, Vancouver is not a city that can just perpetually build out in every direction (like Calgary), which means we all get stuffed in next to each other as prices continue to escalate. Despite the limited land argument, this is not the main reason why the average Vancouver home is more than twice the national average.

The Foreign Money Argument

Metro Vancouver is touted as one of the most “ethnically diverse” places to live in the world. There’s no argument there, this must be one of the only places in North America where you can live a comfortable lifestyle and never have to speak a word of English.

This has caused Vancouver to be a hot bed of foreign ownership and investment in our real estate, and this is the key reason why Vancouver real estate prices are so high. How you say? Let’s dissect further.

I never really understood why foreigners want to live in Vancouver so much. I mean, why Vancouver over any other city. You would think they would want to live somewhere else like Seattle, Toronto or Montreal. What makes us so special?

There are already well established immigrant communities in Vancouver. Don’t believe me? I would challenge you to hang out in Richmond for the day and take a poll of how many people speak English versus a foreign language. It makes perfect sense – if you wanted to buy real estate outside your own country, you’d buy the next best thing and that’s exactly what Vancouver offers this wealthy foreign contingent.

You need a lot of money to buy real estate in Vancouver, right? The people that can afford to still buy in Vancouver are not exactly middle class, they’re business owners, professionals, and basically already very wealthy in their own country. To these people it doesn’t matter if a Vancouver home costs $500,000, $600,000 or a million dollars.

They’re recession proof, this is the key argument that every real estate analyst (that’s calling for a Vancouver housing crash) is missing. The local residents are simply completely priced out of the market, they’re not buying locally or at all. Ask any realtor (selling houses and not condos) how many of his/her sales are to foreign versus local money. I did a poll in of three realtors in Burnaby and each told me greater then 90 per cent are offshore or only live for a portion of the year.

If you are a wealthy Hong Kong or Mainland Chinese businessman worth millions of dollars, do you think it matters if the Vancouver real estate market crashes? Of course not, they’re investing in Vancouver real estate with cash. They don’t need Canadian mortgages and they wouldn’t qualify anyways, they don’t have any Canadian income.

Their money is made somewhere else – so they just pay cash. If you’re worth millions of dollars, do you think you will care if your $1 million dollar house declined in value by 20%? No – of course you don’t. That’s precisely why the Vancouver market is not in for a housing crash.

Could we see some sort of “correction” of 10 – 20 percent? Sure we could – I wouldn’t say a 1 million dollar box in the sky condo that declined to $800,000 a “huge real estate crash.”

It certainly would be a decline in price – but it’s not exactly going to change the game and make real estate affordable in this city.

How We’re Different then the American Real Estate Crash

Wealthy offshore investors purchase homes in cash (not credit). Therefore less leverage making the market more stable.
Local residents mortgage themselves up with real estate they can’t afford, but they’ll get by through renting out the basement, spare upstairs bedroom, and eating canned soup.
There’s no real trigger for a crash as “thousands of owners flood the market with listings” because the majority of Vancouver real estate are all long term holders and not flippers.
American mortgages are different than Canadian mortgages with respect to the fact that in the United States, you can literally just mail the bank the keys to your place and move out. In Canada, when you default on your mortgage they come after the mortgage owner’s personal assets.
How the Government Can Actually Be Useful Here

Living in a place where foreign investors and non-residents are buying up all the affordable real estate is nothing new. There are similar situations all around the world where this is happening.

Think about it – if you were worth millions of dollars and lived in a developing or politically oppressed country, wouldn’t you want to store your cash in a delightfully, economically and politically stable jurisdiction? You have no idea what the government will do next month never mind the next 50 years. This is what the Government can do:

Start collecting statistics on local real estate. I know it’s crazy – for all of the unnecessary stuff that government does, they haven’t even mandated that proper statistics start being collected for who buys and owns real estate (arguably our most precious asset as a country).
Consider implementing foreign ownership rules in a phased approach over time. Why is it that whenever a foreign government wants to buy a big natural resource or technology company, it becomes mainstream news and it’s subject to a “net benefit test.” But when the same thing happends to individual residents (i.e. real estate being purchased en masse, severely disrupting the equilibrium of a local market), it’s ok and no one does anything. I personally do not care if BHP wants to purchase Potash – where do politician’s think the natural resources are going to go? England? I won’t babble too much about this because that’s a separate opinion article.
The Canadian Government needs to get serious about this foreign ownership of our real estate. Residents need to start standing up and protesting our land being sold to the highest bidder in another country who doesn’t truly plan to live here.

Other countries have implemented foreign ownership rules successfully, most notably Sydney, Australia. Our real estate and home prices are not an investment, they are a home.

It is not good for our society to live in a place where homes are expected to increase $30,000 per year.
Posted via RS Mobile

I continue to ask myself, after reading all of the threads here and elsewhere, why are people still here? Metro Vancouver has no jobs, no economic prospects, "hippie" politicians, and people who don't care about the well-being of this place.

People should just pack up, move to Alberta, make 6 figures, and call it a day. Exporting commodities is all we're good at now anyway. (Semi-serious)
Posted via RS Mobile

i failed teh above because it was just the worst article ever, so poorly written, totally one sided.

i love how recent history (<10 years) means we can completely ignore everything else - vancouver has had a large asian community for a LONG FUCKING TIME, this isn't a new phenomenon

ugh, such an ugly article, the person who wrote it is probably wearing skinny jeans drinking coffee in a starbucks on a mac.... living with his parents

"American mortgages are different than Canadian mortgages with respect to the fact that in the United States, you can literally just mail the bank the keys to your place and move out. In Canada, when you default on your mortgage they come after the mortgage owner’s personal assets."


hahahaha, really? that's an interesting fact, because only a small number of states have non-recourse loans.

i won't pick at it anymore because i could be here all day, but WOW! this proves how poor our media is (i know it's not a news source, but still shouldn't be published anywhere - this is almost fear mongering)

Vancitybuzz has been posting a lot of pro-real estate situation/industry articles lately, :suspicious: me thinks they're getting some "incentive" to