Direction anyone?

[EdRenkema]

How the heck do you guys quote s/one ?



Good points all, here is my take. I purchased my home in early 2007 and it was the least expensive good quality home I could find $135K, 2+1 bedrm, 1000sft, full walkin basement, well built war time home. Decent 3bd bungalows were going for $200K & up. At the time my previous res was tenanted & I used a refi to buy, then I turned around 6mos later & negotiated full value leverage HELOC on my home even tho all renovations weren't completed, so definitely an advantage there. Make no mistake I like my house, I've done some really cool things with it BUT I should have bought a newer 3 bed for $200K b/c I could qualify.

You see with a newer home I wouldn't have all the headaches & surprise expenses that I currently have and the appreciation would have been based on $200K. What do you think would be easier to resell, the renovated wartime home (everything is top quality) or the newer home? I guess it depends on the person buying.

My point is the appreciation would have been greater on a newer home without all the headaches, and they continue...

All said and done I like my home b/c it has character and I've made it into s/th nice. The neighbours of course love it since it was the ugliest home on the street before I bought it.

Godfried how am I doing so far?

 

[gwasser]

[quote user=EdRenkema]How the heck do you guys quote s/one ?


First push the <Reply> button to get the editor. Next above the word DESCRIPTION press the blue Quote link,

Good points all, here is my take. I purchased my home in early 2007 and it was the least expensive good quality home I could find $135K, 2+1 bedrm, 1000sft, full walkin basement, well built war time home. Decent 3bd bungalows were going for $200K & up. At the time my previous res was tenanted & I used a refi to buy, then I turned around 6mos later & negotiated full value leverage HELOC on my home even tho all renovations weren't completed, so definitely an advantage there. Make no mistake I like my house, I've done some really cool things with it BUT I should have bought a newer 3 bed for $200K b/c I could qualify.

You see with a newer home I wouldn't have all the headaches & surprise expenses that I currently have and the appreciation would have been based on $200K. What do you think would be easier to resell, the renovated wartime home (everything is top quality) or the newer home? I guess it depends on the person buying.

My point is the appreciation would have been greater on a newer home without all the headaches, and they continue...

All said and done I like my home b/c it has character and I've made it into s/th nice. The neighbours of course love it since it was the ugliest home on the street before I bought it.


I see your point. You bought the cheapest piece of cr.p and you needed to renovate at high expenses. You would have done better if you bought the newer place instead. Good comment





Godfried how am I doing so far?

A bit long... but clear

 

[housingrental]

Re OP - Your current funds to invest is needed to give a more exact answer - 10 years? 30 years?



Re Thomas and Ed's on buying pricier personal residence for appreciation - You too are correct and this works great when a market is appreciating at a significant rate. This seems less likely moving forward the next ten years - if we see losses, minimal movement, or even marginal appreciation yearly it still might be better to go for a smaller home from a financial perspective. When you add in things like a few thousand a year extra in property tax, a thousand a year extra in utilities, and a thousand a year extra in maintenance, you end up with needing to save up close to two hundred thousand extra for a risk free return that will allow you to cover these extra expenses - and when you factor in additional mortgage interest costs for most purchasers over life of mortgage (few are like Godfried and paying off in five years) you NEED to see high appreciation to end up ahead - ie that strategy is with risk.

 

[EdRenkema]

[quote user=housingrental]Re OP - Your current funds to invest is needed to give a more exact answer - 10 years? 30 years?



Re Thomas and Ed's on buying pricier personal residence for appreciation - You too are correct and this works great when a market is appreciating at a significant rate. This seems less likely moving forward the next ten years - if we see losses, minimal movement, or even marginal appreciation yearly it still might be better to go for a smaller home from a financial perspective. When you add in things like a few thousand a year extra in property tax, a thousand a year extra in utilities, and a thousand a year extra in maintenance, you end up with needing to save up close to two hundred thousand extra for a risk free return that will allow you to cover these extra expenses - and when you factor in additional mortgage interest costs for most purchasers over life of mortgage (few are like Godfried and paying off in five years) you NEED to see high appreciation to end up ahead - ie that strategy is with risk.





To your point Adam, the market here has been flat the past 2 yrs, fortunately everything west of here is doing much better (especially Hamilton!). This leaves me in a situation where my home is worth exactly what I've got into it more or less, I'm still not done either. I could've paid it off this yr also but decided against it, I chose to ride out the remaining 2 yrs of my term since it was prime -.8 )

Good pont then on the extra costs since there would have been a higher cost upfront but if it was at prime -.8 thats below inflation. Plus I would have had more time and less stress to focus on my investment business. Indeed I might now have a double handful of student rentals at this time & be handing it off to a property manager. I see you are in a student rental area do you know of any competent PMs??

 

[Thomas Beyer]

[quote user=EdRenkema].. the market here has been flat the past 2 yrs ...


well done .. a flat investment through the worst recession since WW II !! Not so bad .. when the stock market tanked up to 50% then rebounded to still below peak values !!



Going forward, we'll do much better ! All cities with in-migration in Canada WILL SEE FAR HIGHER PRICES in 5 or for sure, 10 years .. probably to the tune of 3-4% on average per year, some more, some less .. so invest in a city with upside.



The Vancouver area, for example, home to about 3.0M people right now expect ANOTHER 1.2M over the next 30 years .. 40% population growth in 30 years .. or 1.3%/year ! Add inflation to that and 3-4% on average per year is quite conservative !!



Ditto in Saskatoon, Regina, Edmonton, Red Deer, Calgary and 20+ other cities in Canada !!



The 21st century belongs to Canada ! Clean air, safe cities, top universities, free press, fairly non-corrupt governments and police, loads of space, lots of jobs, freedom of movement, asset backed pension plan, free/cheap health care, natural resources galore, scenic beauty .. where else do you see such combination of factors ? Sure China might grow faster .. but do you really want to live there .. in a society with no free press/internet, air pollution, questionable human rights, and massive traffic jams ? Why do people with even modest amount of cash send their kids to UBC .. as opposed to people here sending people to India or China to study ? The ratio is probably 100:1 ! Why you should ask !!

 

[gwasser]

He Thomas,



If you are so bullish on Canada, then why such modest appreciation expectations which are below the historic norm of around 6% for many Canadian cities? I am not talking about Tiger Wood Apreciation as in our recent past.