More than 2,000 condos sitting empty in Metro Vancouver amid housing crisis - BC | Globalnews.ca
More than 2,000 condos sitting empty in Metro Vancouver amid housing crisis - BC | Globalnews.ca
Housing crisis? There ain't no stinkn' housing crisis.
There is, however, an 'overabundance of stupid' crisis.
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Condos are stupid. The worst of both worlds between apartment renting and home mortgage.
All I know about condos are that condo fees are quite high. It's like $800 / month for the ones I've seen in Toronto. A lot of people see that as reasonable but it feels like a lot to me.
Fees vary here in Vancouver Metro area. Some at $300, ours went up to $500. Part of the problem is your fees are supposed to build a contingency fund this cover prescribed maintenance, and emergency repairs, however you vote yearly to approve the budgets. Most owners don't want higher fees so vote to keep the fee low. This means the operating budget suffers and preventative work may be delayed or skipped. This turns into higher emergency repairs, or higher cost as delayed projects deal with vendor inflation. So at some point fees sky rocket to catch up.
The condo insurance premiums are going into the strata-sphere as well.
As a former homeowner and former renter, now living in a condo, its also the best of those. We are building equity rather than losing rent money monthly, and when things break somebody else fixes it.
We are building equity rather than losing rent money monthly
This meme has to die, there's so much knowledge out there on how to properly do the math on this
It's fun when people allude to having knowledge they don't display or share. Makes them look like they're feeling smugly superior while also contributing absolutely nothing to anyone.
It's the daddy's money of social media.
There’s a certain threshold at which I won’t bother. Saying that renting is loosing money instead of equity building is the real estate equivalent of being a flat earther.
That threshold is apparently "reality and facts"
Yes I did math, our mortgage at 2% interest is $1700, to rent this condo from a landlord would be $3500. In 5 years the property value has gone up $200K. So our equity is now close to $300k after 5 years. I could sell this year and have 300k cash. What would you have at 3500 a month to a landlord?
I'll have to trust you that you live in a place with bizarre market dynamics where mortgage is cheaper than rent for the same unit, or maybe you're the king of real estate deals or got lucky with a panic seller. Even in that situation, there's a whole lot of numbers missing from that calculation. Property taxes, maintenance, opportunity cost of investing the downpayment, insurance, whether your investments would be taxable or tax sheltered, expected RE growth, a time horizon of 20 to 60 years etc. You will be better off using a proper calculator made by a CFP.
Mortgages are less than rent in most markets.
If you’re talking about a mortgage that was signed years ago, that’s definitely feasible. If you’re talking about a mortgage that would be starting right now, that would be abnormal. I don't know what "most markets" mean to you but I doubt you can show the numbers for any major Canadian city.
A property costing ~ 1MM starting on todays 4.5% rate means a monthly mortgage above 4.8k but will go for rent for about 3.7k
I do understand. Our property tax is cheap here, mine is $100 a month. Insurance is $50. Ontario and British Columbia have very high real estate market, people get stuck renting because the 5% down payment is hard to save (for some) a 1 bedroom basement suite can be $1500-$1800 to rent. My friend pays $1200 to rent a single room in somebody's house.
Mortgage is the way to go if you can have enough income to qualify for it and have the down payment. However back in early 2000 before Toronto prices spread to rest of Southern Ontario my mortgage was around $800 a month and the same house across the street was being rented for $400 a month. I agree in that scenario it would make sense to rent...but only for a time...eventually you have to retire and don't want to be paying rent that has increased year over year. I.e. here rent can go up 3-4% y over year.
Mortgage is the way to go if you can have enough income to qualify for it and have the down payment.
This is simply not true in the general case, and stating something simplistic like this is a disservice to people's financial literacy. The highest variable in this accounting isn't even market dynamics, it's the investment habits of the counterfactual renter.
There are situations in which buying is more appropriate than renting, due to personal circumstances and specific market conditions of where a person wants to live. But it's not at all a clearcut decision without those specific conditions.
I agree in that scenario it would make sense to rent…but only for a time…eventually you have to retire and don’t want to be paying rent that has increased year over year. I.e. here rent can go up 3-4% y over year.
No, it's not "only for a time". Mortgage is leverage at a low rate, so as soon as it's done, the cost of ownership for the home makes ownership worser in comparison to renting. The reason this isn't obvious is that you're not doing the comparison to the counterfactual renter investing the downpayment amount plus the cashflow surplus during the entire lifecycle of the mortgage.
There is no cash flow surplus in BC and Ontario though, housing market is too high, rent is way too high, that people spend majority of income on housing. The person working and paying the amounts I quoted you is working to live. The old days of cheap rent where the metric make sense are gone out here.
There is no cash flow surplus in BC and Ontario
So you’re saying that in BC and Ontario the monthly mortgage payment is lower than the cost of rent for a comparable unit? Maybe you misunderstood what I meant with cash flow because that’s wildly out of base. My rent is $1000 less than the monthly mortgage for the same unit
Not sure where you live but as I mentioned my friend pays $1200 for a room in a house. A another lady pays $2200 for a coach house above a garage. My place could rent for $3500 While a mortgage is way less.
Out here at least landlords charge way more than their mortgage coat plus maintenance because they are income properties and the scarcity.
My place could rent for $3500 While a mortgage is way less.
If you're talking about a mortgage that was signed years ago, that's definitely feasible. If you're talking about a mortgage that would be starting right now, that would be abnormal. A property costing ~ 1MM starting on todays 4.5% rate means a monthly mortgage above 4.8k but will go for rent for about 3.7k
I think a lot of them also have HOAs, too. At least in the USA, dunno about CA.
And at least with a house mortgage you usually get a lawn...
Bit different. The condo is a legal company ,collects fees
To operate the building maintenance and repair, insurance, snow removal, etc.
All owners vote yearly on changes to bylaws, or projects to be done.
I.e.hypothetically there could be laws about no blue patio furniture, however if majority of owners vote for allowing blue, then it gets changed.
Its an owner run corporation.
I see. Definitely sounds slightly better. HOAs were supposed to be like that at one time here, but then they became miniature dictatorships.
Yeah HOA in USA often seems like the current HOA owns the property sale rights, and can block a sale. Strata has no say in the sale, it is an owner to owner deal.
A lot of people complain about strata being restrictive, but guess who doesn't show up to vote at the meetings; Same people who don't want to join council when the new one is voted in each year.
BC has strata corporations, which are kiiiiind of the same thing based on my shitty surface-level understanding of HOAs.
And basically all multi-family housing has a strata.
Yep, sounds like the same thing
Stratas in BC are very highly regulated.
you usually get a lawn…
Fish don't need bicycles, and we don't need to hoard greenspace when it can be consolidated very well into something useful by so many more people.
At larger scale, consolidating greenspace surrounding clusters of effective dense mixed-use residential cuts land-use tremendously, re-wilds a lot of other space or returns it to agriculture, and achieves the density required for better transit and savings on infrastructure costs. The housing has to be effective, and I think the new "mixed-use consolidated over a transit stop" configuration is a definite winner ... as long as it's not wood (aka Fire's Favourite Food).