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the pope

Jim: Sounds like you'll be fine even if our market corrects a bunch, First time buyers have more to lose in that situation, or at least less of a buffer to weather the loss.Not sure if you're serious or not, but I think the blog is a great idea. I'd read it. The pro's and con's of living in a reno sounds like it would provide some interesting material. If you don't feel like running a full blog I'd be happy to publish occasional updates from you here.

Jim

Freako:In 1982 I was 25,so I was in party mode, although I did own a house in Richmond on St. Albans. Bought for $41k 1979 sold for $58k in 1983. Rentah: my c.o.c. is a low 4.5% and I will live in it while I reno, as it has 2 kitchens and 5 bedrooms. Our kids just left.Your numbers are close(bit high) but if the market corrects I will be into it for $144m -its today comp is 1.5 to 1.6 post reno. If the market corrects by less than 9% in 6 months I am still ok. I will also happily live in it since the reno will be pretty swish. Not sure what you mean by "transfer cost"? Legal is $600, tax is $23k, I get afairly good discount on RE commish, ?I was thinking of putting up… Read more »

digi

Jim, I thought you had said previously that you worked as a house inspector – does that really bring in enough to pay 5k a month on rent, or am I mistaken about your vocation?

rentah

jim:I rent on the westside.Last house was at 1:533 rent/price ratio.Current house 1:400.You figures work out to 1:273, so your rent comparison figure may be higher than current market rents.Regardless, you're talking about being into this house for:1300K purchase,plus 120K (renos), plus carrying for a year (say 80K),plus transfer feesplus agent's fees (?)plus property taxesminus rent if you're actually crazy enough to live there through the renos.So this house will have cost you more than 1500K by the point of next sale, and you say that the current comps are going for about that.This isn't just a lot of work, it's also a large bet on market direction.

freako

I was paying $4750 in rent plus utilities for a comparable house. My basement suite rents for $1200.00. I will general contract the renos myself. Just curious Jim, how did 1982 treat you?

Jim

rentah:I was paying $4750 in rent plus utilities for a comparable house. My basement suite rents for $1200.00. I will general contract the renos myself.

exvancouverite

The more of the low life bastards get caught with neg cash flow little boxes,when the bubble bursts, the better.No I won't shed a tear.That's what I love about your posts, Tulip. You're such a ray of sunshine.I, on the other hand, don't harbour such fine sentiments. When I see my old neighbourhood degenerate into the debacle of a twin 30-odd story towers 'Silhouette' lifestyle, I can only hope that the developer has his nads crushed. Twice. But, I'm kind of old-fashioned, in a way.

tulip-Mania2

patriotz said… “ Tulip, if you owned Nortel in, say, June 2000 and decided to sell because you thought it would tank, would you feel guilty?”No guilt whatsoever. I see Nortel speculative shares, and residential Re as two distinct things.I won’t sugar coat my feelings on this. If Jeff could assure me that he was selling to speculators, I would gladly give him a hand at marketing to them. The more of the low life bastards get caught with neg cash flow little boxes,when the bubble bursts, the better.No I won't shed a tear.

Jade East

Just looked it up how long it took tobuild the Empire State building.Quite impressive time-wise they musthave saved time by not installing thegranite countertops.

freako

"Freako: I had always thought that construction cost increases exponentially with height, as the weight of each additional floor need to be supported by every floor underneath, and supported by the foundation."I am no expert, but from what I gather it is cheap to add floors within an existing design. If a given design can go up to say 40, and you manage to get zoning for 35 instead of 32, the extra three floors come at low marginal cost.However, if you wanted say 45 floors, you'd have to go to a more expensive design with the additional support you mention. A bit of a duality. Overall, the greater the height, the greater the marginal cost.I don't think marginal cost will ever decrease for the support/evelator issues mentioned, but I am wondering if new technology will dramatically reduce total cost.… Read more »

jesse

"Hard as it may be to belive but with the basement suite rented its break even versus renting the similar house."This is possible but depends upon the size of your mortgage.

patriotz

That of course implies a victim, how do you feel about that?Hey Tulip, if you owned Nortel in, say, June 2000 and decided to sell because you thought it would tank, would you feel guilty?And I seem to recall Freako saying he shorted a lot of tech stocks around them. Are you going to rag on him too?Or if you owned a mutual fund would you want the manager to sell a stock that he thought was overpriced? That's what you're paying him for, isn't it?Don't ever forget RE agents work for the seller, not the buyer. An RE agent has no obligation to the buyer except to accurately represent the property for sale. It's up to the buyer to decide what price is worth paying.

el bbub
Jeff

SATV is a strange person.I am here to report what I am seeing.

markx

Freako: I had always thought that construction cost increases exponentially with height, as the weight of each additional floor need to be supported by every floor underneath, and supported by the foundation. The current design of high rises don't have as high FSR as equal height buildings in NYC or Tokyo, as the base of building contains townhouses and green space. Thus my belief for the conspiracy. On a second thought, it's possible that the increase in height brings in lower labour cost per floor, as only one foundation need to be laid. As labour in Canada now is extremely costly on a global scale, the incremental cost in construction material and equipment becomes inconsequential.

markx

Rents have been rising, but only sharply in the past year or two. What a coincidental mirror with Florida! The bulls were hoping for rents to skyrocket, as rental apartments were converted to condos, and bitter renters were at the brink of driven to the street. Then all of a sudden the market just crashed, forcing flippers into "accidental landlords". To all renters: be prepared to check the credit of your "accidental landlord". Don't rent a place that's being foreclosed on.

Richard

"…do you know the way you running your bus people don't want to be there thats why your open house's were flop show.."You know, at least Jeff's said he's a realtor, so maybe he knows what he's doing? And how would you know the reasons why attendance was low? You weren't there.You on the other hand, we've got no idea what the heck it is you do other take potshots all the time.

rentah

jim said: Hard as it may be to belive but with the basement suite rented its break even versus renting the similar house.—jim, could you please break down the numbers? I can't see how it'd be break even.

satv

runaway realtor(jeff)jeff you have come all the way from toronto.seems like you are such in hurry to go back,do you know the way you running your bus people don't want to be there thats why your open house's were flop show.even people don't know your full name and your website address,otherwise your liecense should have been provoked so far.current market rating(does not mean can't buy/can't sell)west vancouver status(buyers market) sales stable condition 410prices in the middle little up by 610vancouver westside status (sellers market)sales up 710prices up 810vancouver eastside status (sellers market)sales up 6.510prices up 6.510north vancouver status( sellers market)sales up 810prices up 810

satv

jim i thought you stand by vance but you are a clever fox.would you mind runing your own top 20 countdown here.start from 1 to 20.

Jim

I bought last week. But since I downsized I can still sleep at night. Bought a fixer upper in Point Grey(I love renos). Cost: just north of $1.3m. I will replace all the floors with new hardwood, new kitchen, remove some walls, gut 3 baths, paint in and out, landscape. Cost about 120k. Todays FMV for the as renovated comps are $1.5m to $1.6m. Hard as it may be to belive but with the basement suite rented its break even versus renting the similar house. However its not for the faint of heart, and this is reno number 21 for me.

wg2c

try again wg2cOK, let me try one more time to be helpful:incorruptibles of some scarcity that have monetary value generally appreciate;corruptibles of similar scarcity and of monetary value generally depreciate.of course this is a generality, but applicable to real estate except under special circumstances (e.g., RE in resource-based towns such as Gold River and Riondel).over long term, land will generally increase in value;over long term, buildings on land will generally and eventually decay physically and fall down, having no value.land appreciates,buildings depreciate.it's really quite a simple and fundamental truth, and thus reflected in accounting principles.

freako

"I've seen a graph for greater vancouver going back to the '60s, it's a very gentle rolling downhill slope up until the current run up."Sorry I didn't make it clear. I meant per square foot of LAND. Or acre or whatever.

Drachen

freako"The one number I'd like to see is average rental revenue per square foot over time (in real terms) for prime downtown."I've seen a graph for greater vancouver going back to the '60s, it's a very gentle rolling downhill slope up until the current run up. Even so current rents are not even hitting '80s numbers for inflation adjusted value. I think the graph was over at VHB's so I'm not sure if I can find it again, if I do I'll let you know.

freako

"Look how well John Talbott did with his book, and how many people in the US he probably prevented from financial suicide, although his background was not in RE. "As I have pointed out many times, reality will have to be imposed from the outside. Nobody in the industry has the incentive or knowledge to call a spade a spade. And that is one reason why things have gotten as bad as they have.