Quote:
Originally Posted by 4444
So many people stretch themselves to buy as much as they can, as this is what our parents did. Over our parents' time, real estate has gone up and up so this approach was prudent and has created a lot of 'wealth' for them
Times are different, real estate should increase approx. with inflation, 2-3% a year - this is enough, with leverage, to grow one's net worth. But we will see no real growth in real estate in Vancouver for a long time, will lag inflation and likely go down a lot over next 10 year, in my opinion - leverage is a double edged stored - most of ur parents are now mortgage free, they are sitting pretty good (the smart ones who are mortgage free and have savings, and a pension), we're ALL fucked - no more growth in real estate, no more good pensions, there will be no government social security when we're at retirement age... If u haven't realized yet, the baby boomers have fucked us over big time! (Thank your elected officials for this, they should have been able to see this 20 yrs ago)
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...and that sums it up nicely in a little bow.
I'm going to add that there is more that our parents did that "we" have little patience for.
My parents first house was a piece of shit. They didn't like it, as it didn't have land...so the next one was worse, but it was on acreage. Honestly, the before pictures(slightly before my time, but my sister remembers) featured a house with a working toilet in the living room, paint peeling on the outside, and alder brush up to the back door. The quintessential "fixer upper". You know, 5 minutes from being condemned.
And over the next 20 years, slowly they made improvements, and fixed things and painted, and renovated and called in favors and horse traded labor to make it a nice house. A few weeks ago, I came across the letter from the bank that she had kept all these years. It's the letter you get when you made your last mortgage payment. It said, "your house is yours". Well, then they got divorced and sold it, but my mom did it again. She bought the shittiest condo she could find. I painted it for her, and she slowly replaced appliances and put new flooring in and so on. She got it for the cheaps, as no one else was willing to look past the nasty carpet, and dull dirty sky blue paint.
I find that so many people go and buy a brand new house...and finance out the stainless steel appliances and, well, you have to upgrade to the granite counters...I mean you have to. Well, no wonder a 1% increase in interest is going to kill you. You were dead when you signed the papers.