REVscene - Vancouver Automotive Forum

donk. · 07-25-2021, 03:10 PM

Its only going to get worse.
Next summer prices will be another 10% of what they are today

JDMDreams · 07-25-2021, 06:37 PM

^^ I agree, just wait till we reopen the borders, cash is trash. Once we get international students and new immigrants one beds are going to be in demand again cuz those are the only units ppl can afford.

donk. · 07-25-2021, 09:37 PM

https://www.google.com/amp/s/www.cbc.ca/amp/1.5782642

If this is even 20% true, theres your 20% bump for next summer

Add in 0.01% of hong kong, and 0.01% of us of nope, make it another 20%

carsncars · 07-25-2021, 11:38 PM

So, after closing on a house in February work has offered me a (reasonably lucrative) 24-month contract in Toronto. Good timing.

What are people's thoughts on what to do with a house for 24 months? Accommodations are taken care of me in Toronto so the mortgage payments aren't the issue, but (a) vacancy tax and (b) leaving a detached house empty for 24 months are issues.

I could rent it, if the right tenants come along. I guess I would have to get consent from my mortgage lender to rent it out, since it was purchased as owner occupied?

I have half a mind to offer my (mid-20's, working) cousin the opportunity to live there for cost of utilities (+some house, garden upkeep) just for the ease of it... on the whole I've seen a lot of rental horror stories.

sdubfid · 07-26-2021, 05:13 AM

Quote:

Originally Posted by carsncars

So, after closing on a house in February work has offered me a (reasonably lucrative) 24-month contract in Toronto. Good timing.

What are people's thoughts on what to do with a house for 24 months? Accommodations are taken care of me in Toronto so the mortgage payments aren't the issue, but (a) vacancy tax and (b) leaving a detached house empty for 24 months are issues.

I could rent it, if the right tenants come along. I guess I would have to get consent from my mortgage lender to rent it out, since it was purchased as owner occupied?

I have half a mind to offer my (mid-20's, working) cousin the opportunity to live there for cost of utilities (+some house, garden upkeep) just for the ease of it... on the whole I've seen a lot of rental horror stories.

Your insurance company needs to know if owner occupied or not. You shouldn’t need consent as your living situation has changed and I don’t think this would be considered fraud in the event it’s an insured mortgage. I don’t know how your numbers/expenses look and what you could rent it for but 24 months of income earned while you are sleeping is attractive. However I think you would lose capital gains exemptions for 2 years going this route. I use a property management company who takes care of sourcing a tenant, inspections, deals with repairs etc. They take a 10% cut but honestly I forget I even have properties because it’s so seamless.

One thing you might want to consider is having your cousin stay there as a “roomate” and having all your mail still go there. But you didn’t hear it on sensitivescene.

JDMDreams · 07-26-2021, 07:56 AM

The bank doesn't give a f what you do as long as you make payments and don't screw around with the title

ssjGoku69 · 07-26-2021, 08:56 AM

Quote:

Originally Posted by sdubfid

However I think you would lose capital gains exemptions for 2 years going this route.

There is a tax election 45(2) or 45(3) that the taxpayer/homeowner can submit to the CRA to retain that principal residence of the property in this exact situation. Talk to your tax guy though

supafamous · 07-26-2021, 10:09 AM

Quote:

Originally Posted by ssjGoku69

There is a tax election 45(2) or 45(3) that the taxpayer/homeowner can submit to the CRA to retain that principal residence of the property in this exact situation. Talk to your tax guy though

Yup, I used this tax election when I moved to Victoria for work for 5.5 years. Was able to avoid capital gains on the entire 5 years that I rented out my apartment. It's really easy to do - it was just a basic letter that I sent in saying that I moved due to work and therefore was renting out my place (presumably if they audited they would have wanted more proof like a letter from my employer).

In my particular case I had moved back into the place when I returned then sold it later and by moving back in I could file the letter after the fact. If you don't move back in then you have to file it beforehand.

carsncars · 07-26-2021, 12:08 PM

Thanks all for the perspectives.

The only reason I was asking about the mortgage is because they do have a term in my mortgage around not leasing without the lender's permission. I'll ask my accountant about the 45(2) election.

Obviously the rental income would be a bonus, as long as it's not going to be a headache.

Quote:

Originally Posted by sdubfid

I use a property management company who takes care of sourcing a tenant, inspections, deals with repairs etc. They take a 10% cut but honestly I forget I even have properties because it’s so seamless.

Are you willing to recommend a company? 10-20% sounds like something I'd be happy to pay to have someone manage that. Feel free to PM if you'd rather not post it for whatever reason.

Hondaracer · 07-26-2021, 01:04 PM

Scotia hounding us to renew our mortgage as we are within the last 5 months of a 5 year fixed

They are offering 5 year variable at 1.2 and 5 year fixed at 2.1

What do you guys think about early renewals? No penalties as we would be staying with Scotia however I haven’t been thrilled with their service and we have a bit of a visibility problem with both the mortgage and HELOC as we don’t bank with them.

JDMDreams · 07-26-2021, 01:49 PM

Get a HELOC, don't renew mtg. But the rates that you got offered is on the low end.

EvoFire · 07-26-2021, 02:52 PM

Quote:

Originally Posted by Hondaracer

Scotia hounding us to renew our mortgage as we are within the last 5 months of a 5 year fixed

They are offering 5 year variable at 1.2 and 5 year fixed at 2.1

What do you guys think about early renewals? No penalties as we would be staying with Scotia however I haven’t been thrilled with their service and we have a bit of a visibility problem with both the mortgage and HELOC as we don’t bank with them.

That's some pretty good rates imo. It would be hard to beat from a big bank.

donk. · 07-26-2021, 03:11 PM

Quote:

Originally Posted by Hondaracer

Scotia hounding us to renew our mortgage as we are within the last 5 months of a 5 year fixed

They are offering 5 year variable at 1.2 and 5 year fixed at 2.1

What do you guys think about early renewals? No penalties as we would be staying with Scotia however I haven’t been thrilled with their service and we have a bit of a visibility problem with both the mortgage and HELOC as we don’t bank with them.

Tell them bank x and broker y offered you another 0.2% lower to jump ship, then get them to match it

Thats how i get my lowest rates, they just fold

Ps, in the same boat for next year, but its rbc, the "mortgage specialists" are all hellowwww yeesss nicce too meett youuu.
And then when the deal is done, and you ask them a question, they provide the rbc hotline number

JDMDreams · 07-26-2021, 03:13 PM

^ you do know mortgage specialists are just like car salesman and work on commission. You don't call them if you need a warranty repair.

donk. · 07-26-2021, 03:25 PM

I know now

Hondaracer · 07-26-2021, 03:30 PM

Our broker who is a friend and got us the original mortgage with Scotia basically told us to take the 5 year variable as that rate was lower than she could even scrounge up from a lot of third party lenders etc

quasi · 07-26-2021, 04:01 PM

Quote:

Originally Posted by donk.

Tell them bank x and broker y offered you another 0.2% lower to jump ship, then get them to match it

Thats how i get my lowest rates, they just fold

Ps, in the same boat for next year, but its rbc, the "mortgage specialists" are all hellowwww yeesss nicce too meett youuu.
And then when the deal is done, and you ask them a question, they provide the rbc hotline number

I've had a good experience with RBC but if I question anything I just go to my brother in law who is the regional manager of all those RBC mortgage specialists. That said I've been dealing with the same RBC broker for the last 10 years plus before my inlaw was in that spot.

PeanutButter · 07-26-2021, 04:09 PM

Quote:

Originally Posted by Hondaracer

Scotia hounding us to renew our mortgage as we are within the last 5 months of a 5 year fixed

They are offering 5 year variable at 1.2 and 5 year fixed at 2.1

What do you guys think about early renewals? No penalties as we would be staying with Scotia however I haven’t been thrilled with their service and we have a bit of a visibility problem with both the mortgage and HELOC as we don’t bank with them.

Whoa 1.2 variable? that's insane.

Are you leaning towards the fixed?

Hondaracer · 07-26-2021, 05:52 PM

Quote:

Originally Posted by PeanutButter

Whoa 1.2 variable? that's insane.

Are you leaning towards the fixed?

My wife is all about the security of fixed but I think we’re just going to do variable. Our broker sent some basic calculations and as long as you watch the rates and lock into a fixed rate if you get scared by changing % you should still come out well ahead

My parents and other people I know have almost always been on variable and historically
I believe you’ve almost always come out ahead

JDMDreams · 07-26-2021, 06:07 PM

Canada can't afford to rapidly hike up rates so I doubt you have anything to worry about

VR6GTI · 07-26-2021, 06:29 PM

I just renewed a few weeks ago with RBC for 1.2 variable 5 year

supafamous · 07-26-2021, 10:28 PM

Quote:

Originally Posted by Hondaracer

My wife is all about the security of fixed but I think we’re just going to do variable. Our broker sent some basic calculations and as long as you watch the rates and lock into a fixed rate if you get scared by changing % you should still come out well ahead

My parents and other people I know have almost always been on variable and historically
I believe you’ve almost always come out ahead

Since the spread is .9% the odds that the BOC would increase interest rates that much in the first half of your mortgage are really, really low. To end up losing out the BOC would have to then increase the rates a total of 1.8% over a 5 year period. Basically won't happen. It's only when the spread between variable and fixed is small (less than .5%) that it's risky.

I had a bit of regret on my last mortgage when rates spiked in year 3 and 4 but I still came out ahead in the end.

CivicBlues · 07-27-2021, 10:03 AM

Quote:

Originally Posted by Hondaracer

My wife is all about the security of fixed but I think we’re just going to do variable. Our broker sent some basic calculations and as long as you watch the rates and lock into a fixed rate if you get scared by changing % you should still come out well ahead

My parents and other people I know have almost always been on variable and historically
I believe you’ve almost always come out ahead

We renewed back in April for 1.31% Variable with Scotiabank with 6 months left on our 5yr term. I say jump on it so if the boat sinks we can be on it together

68style · 07-27-2021, 10:41 AM

I've had variable rate since 2003 on every place I've owned and I've never regretted it even once... all my friends keep doing 5 year fixed for the last 15+ years paying 2% more than market price always and it's never helped them.

I look at it this way -> the bank always pushes you to lock in... does the bank EVER advise you to do anything that's beneficial for you without it also being even more beneficial for them? Nope.

Traum · 07-27-2021, 11:14 AM

Historically, variable rate mortgage has generally been cheaper for the consumer only because interest rates keeps dropping. But given how the BoC policy rate is already at 0.25%, it makes me wonder how much more room there is for it to drop.

Granted, if I were given the choice to choose between that 5 yrs 1.2% variable vs 5 yrs 2.1% fixed today, I am definitely going to take the variable rate mortgage. But I am certainly not going to treat variable rates as a universal truth.