Comments on: First time homebuyers dissapointed

By: krrish

krrish — Sat, 05 Jan 2008 20:41:35 +0000

Hpi graph

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By: VanCon

VanCon — Fri, 04 Jan 2008 20:12:58 +0000

Wha??

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By: freako

freako — Fri, 14 Dec 2007 14:12:00 +0000

The 40 term in itself is not a big deal. All else the same, a buyer could invest the "savings" in equities or whatever. The problem happens when prices go up in response.

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By: freako

freako — Fri, 14 Dec 2007 14:10:00 +0000

The difference in monthly payments between 40 year and longer amortizations (including interest-only, which is infinite) is very small That is exactly the thing. Going from one extreme (25 year) to the other (interest only) only lowers the payments by 20%. And that is a one time shot that gets eaten up in a year and change juding by recent appreciation.When you buy a place with 25% down, you are paying 80% interest to start.

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By: e

Fri, 14 Dec 2007 09:17:00 +0000

40 year mortgage is crazy.Assuming they can buy a $400k property (cheap townhouse somewhere?), it will cost $1725/mo in mortgage, and $350/mo in property tax/maintennace.Assuming same thing can rent for $1400/mo.That means every year, if they save the money saved by renting ($2075-1400), they will save $8100/year. Over 40 years compounded at a reasonable 7%, that means at the end of the 40 years, they will have 1.6M$. That house better be worth more than 1.6M in 40 years.If they invest in an index market fund which is 12% avg over its history (i.e. DOW), then that house better be worth over $6.2M after 40 years. The house has to go up 7% each and every year for 40 years in order to reach that level (break-even).

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By: patriotz

patriotz — Fri, 14 Dec 2007 03:14:00 +0000

In Spain they have 100-year amortizations. Don't think it couldn't happen here.The difference in monthly payments between 40 year and longer amortizations (including interest-only, which is infinite) is very small - no more than 1/10 of the monthly payment at 6%. It doesn't raise the bar much.With a 40 year term and 6% interest, it takes 12 years just to pay off the first 1/10 of the mortgage balance. And God help the buyer if interest rates go up when it's time to renew after 5 years or whatever. This means that first-time buyers will not have the resources to trade up for a very long time. Any market where 40 year (or longer) term becomes the norm is headed for long term decline.Like Japan, you know?

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By: Ulsterman

Ulsterman — Fri, 14 Dec 2007 00:09:00 +0000

what i don't get about Vancouver being the "Best Place on Earth" is that 95% of people here don't do anything outdoorsy on a regular basis.I you don't golf, ski, mountain bike, play beach volley ball, or rollerblade the seawall why move here?It certainly isn't for the high-paid head office jobs or the diverse cultural scene.Maybe everyone just loves the rain and traffic...

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By: wizardofozziejurock

wizardofozziejurock — Thu, 13 Dec 2007 20:49:00 +0000

The percentage of first-time buyers going with 40-year mortgages is astounding. It's Canada's own version of the subprime market. Politicians, bureacrats, media (for the most part) just want to ignore it and feel all smug whilst the US housing market tanks. It's like watching an accident in slow motion.

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By: Swirlyman

Swirlyman — Thu, 13 Dec 2007 19:50:00 +0000

Whatever it takes to get people to scrounge up a monthly payment. In Spain they have 100-year amortizations. Don't think it couldn't happen here. (You probably have to have children for the bank to give you one of those, though.)

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By: ThumbsUp

ThumbsUp — Thu, 13 Dec 2007 18:46:00 +0000

Sophia,I have explained that earlier price to rent or buy can be fixed by floors,view,amenities,utilities,unfurnished or full furnished etc.Sophia,it's!okbecause starata man did not find a detail on phone so just forgive him to confuse us.Drachen,those folks are doing something even today which you should have done that long ago.Our own home is a wonderful place on this earth.Again who ever can afford monthly payment for term,Drachen.It's!Ok.seen that article about Age 25,30 this time it's not me but statistic Canada drachen.It's!OK

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