Rob Carrick wants you to rent

Actually I don’t know that he wants you to rent, but over at the Globe and Mail he’s got a column that compares owning to renting and it doesn’t make buying at these prices look so hot.

Do not base your thinking about your ability to afford a house strictly on what lenders or real estate agents tell you. They may have useful guidance, but their goal is to sell mortgages and houses. That’s why the affordability measures they use pretend you live a world where there are no claims on your household cash flow other than those related to your home and other debts.

Being able to amass the minimum 5-per-cent down payment on a house does not mean you’re ready to buy, either. In the real world of home ownership, 5 per cent is peanuts. By some estimates, the costs of buying a home – mover, property taxes and utility bill adjustments, legal fees and repeated trips to Canadian Tire or Rona could cost an additional 2 to 4 per cent of the value of your home.

I’m guessing the Globe and Mail doesn’t make as much ad revenue from real estate agents and mortgage brokers as the Vancouver Sun?

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Paul
Paul
9 years ago

@nobodywouldbelieveus

"It is amusing when people say “oh, you are a renter…” with that oh so familiar Vancouver sneer. Then I get looked up and down and they see my cheap clothes. What are you gonna do? I can’t keep up."

I've never experienced this "vancouver sneer" I have to admit, despite renting for many years. Try getting some better friends or acquaintances maybe?

Who even asks someone if they own or rent anyway?

Anonymous
Anonymous
9 years ago

@vci_sucks:

Slow sales day?

vci_sucks
vci_sucks
9 years ago

holy smoke.

what happened to the new mortgage rules? what happened to some that predicted it will crash soon.

til today. I see more good news for bulls than for bears.

nobodywouldbelieveus
nobodywouldbelieveus
9 years ago

@lolcats

Hilarious. Do not forget to include members only jacket, sports illustrated football phone and of course your moms panties.

Patiently Waiting
Patiently Waiting
9 years ago

@VHB: Interesting to see how COV is consistently much stronger than the suburbs.

VHB
VHB
9 years ago

Dailies – List | Sold

Vancouver East & West*

New Listings – 72

Back On Market Listings – 0

Price Changes -32

Sold Listings -58

Vancouver All Areas*

New Listings – 271

Back On Market Listings – 1

Price Changes – 125

Sold Listings – 169

*Attached & Detached – Date: 04/19/2011 Time:22:05 Pacific YatterMatters.com: Courtesy REBGV. Data believed to be accurate but is not guaranteed.

horse
horse
9 years ago

@nobodywouldbelieveus: Has anyone ever seen a number? last time this topic came up I think the number was around 3000 visitors a day here. I remember talk of the number roughly doubling after the rollercoaster video was posted.

fixie guy
fixie guy
9 years ago

@120 lol cats: Scratch that one up on the bus after school bunky?

lol cats
lol cats
9 years ago

@nuxfan:

i love the internet.

for each 1K in savings a bear claims to have you have to divide by 10 and subtract 2. for example 300K tucked away equals 28K ((300/10)-2).

These savings often include:

*the value of their vehicle in 2008 (not excluding any remaining payments)

*star trek dvd collection and/or hockey card collection

*smoking paraphernalia

*the 7.5K their folks promised to give them if they move out

*an organ such as a kidney

if my math is off i welcome any errors/omissions you may pick up on.

ReadyToPop
ReadyToPop
9 years ago

Real men now rent.

Patiently…..

Thanks Garth…it'll make a great T-shirt.

Aaron Chipman
Aaron Chipman
9 years ago

"@crabman: d. People in the RE industry."
No industry people , or my uncle Dave ever visit this blog

Anonymous
Anonymous
9 years ago

@Tuntun: …Everyone can afford here! What the problem?….

Grammar, apparently!

VANCOUVER_RE_SUCKS
VANCOUVER_RE_SUCKS
9 years ago

People who said rent doesn't understand this crazy Vancouver real estate market.

I was out looking for a 2 bedrooms place to rent. Most of them returned my call after hours and told me the units were rented.

the units I viewed are either overprice or it is very crappy and they asked for > $1500.

crabman
9 years ago

@Absinthe: I should have said 'many' not 'most'. There are probably 5 or so different types of VCI readers:

a. People with resources waiting for a sane market.

b. People frustrated that they can't afford anything decent.

c. Worried recent buyers.

d. People in the RE industry.

e. Trolls.

It would be interesting to see a poll.

nuxfan
nuxfan
9 years ago

"Nobody disputes you’re telling the truth, it’s just odd that a bear argument is that median/average salaries are around $60K in Vancouver, but almost every bear here has anywhere from $300,000 to $3,000,000 in cash sitting around."

I hope not – there are plenty of places to get far better return on your cash than sitting in a bank account. If you're going to have that much liquid asset lying around, at least put it to good use.

Robert Shiller
Robert Shiller
9 years ago

Does anyone here know how I can get in touch with Dave?

Absinthe
Absinthe
9 years ago

@crabman: I would agree that there are a lot of investors with some cash here who are watching bemusedly, but also will note that I and others have 'come out' as having families making close to the average wage. I've got a DP saved, but in this market it's a joke.

Devore
Devore
9 years ago

@Flip Flop: A lot of the commodities inflation we have seen recently has been absorbed by the margins and inventory in the supply chain. If the prices don't back down, retailers will have no choice but to pass on the higher prices. They're already doing it, but it is selective and sometimes hidden, like with smaller packages or cheaper ingredients.

I would imagine areas that are more vertically integrated or have very short supply chains (raw foods/fruits/veggies) are less tolerant of input costs.

crabman
9 years ago

@Anonymouse:

Nobody disputes you’re telling the truth, it’s just odd that a bear argument is that median/average salaries are around $60K in Vancouver, but almost every bear here has anywhere from $300,000 to $3,000,000 in cash sitting around.

Why would someone be here if they had no money? Or if they already bought a place? It makes sense that most people here have the money to buy something but have chosen not to. And while some of the most obnoxious bulls have been calling us losers, we've been saving quite a bit!

patriotz
9 years ago

@Anonymouse:

I don’t see why somebody on an average salary should necessarily be entitled to buy a million dollar home.

Nobody's entitled to buy RE at all, which is why we want to government to get out of the mortgage market and give up other schemes promoting home ownership, which would result in houses being reasonably priced and requiring the buyer to put up a decent down payment.

Nobody is entitled to sell RE for any given price either, which is why I have no sympathy for the fools who bought at inflated prices and are going to end up BK.

Absinthe
Absinthe
9 years ago

@Anonymouse: "I don’t see why somebody on an average salary should necessarily be entitled to buy a million dollar home. An average one, perhaps – and in Vancouver that means a condo." Well, hold up. Trustworthy and most often cited average and median family salaries are based on statscan numbers, and that's census family data. Singles with one person in their households make substantially less by both these measures. Condos certainly serve census families, but there is skew in the data – SFH and townhomes almost never are studios and rarely one bedrooms. Studios and one bedrooms, which will better suit single persons not in census families, therefore are skewed smaller by having almost all of the "one-person-sized" inventory. Which is why it is irritating that so far I've been unable to find statistics controlling condos for family size. Anyway:… Read more »

nobodywouldbelieveus
nobodywouldbelieveus
9 years ago

“There are thousands of blog readers here”

I stopped reading your post after that line….

Thousands? Really? And only two dozen of those “thousands” feel confident enough to post anything The rest are merely sheeple?

Come on, give your head a shake…."

I read a popular site that has a couple of million unique visitors a day and a top story might have 800 comments. A story that touches a nerve might get up to 4000. I think I saw 8000 once.

I guess only the webhost knows. Has anyone ever seen a number?

Chufney
Chufney
9 years ago

"There are thousands of blog readers here"

I stopped reading your post after that line…. 🙂

Thousands? Really? And only two dozen of those "thousands" feel confident enough to post anything 🙂 The rest are merely sheeple?

Come on, give your head a shake….

nobodywouldbelieveus
nobodywouldbelieveus
9 years ago

@alx "This is analogous to the “rich Asian foreigner” myth. You get the 10 Asians on TV paying over asking and the hundreds of locals who pay over asking don’t get reported, and we think our town is taken over by foreigners. Same idea." Very well put. In the days of our $40,000 a year income and -400 in savings I would not have bothered to post. Statistics has continuously shown us that outliers exist, and I know we exist. Free market economies being what they are, past performance is no guarantee of future performance though. I try to live as if we make the median salary, we may again someday. It is amusing when people say "oh, you are a renter…" with that oh so familiar Vancouver sneer. Then I get looked up and down and they see my… Read more »

alx
alx
9 years ago

There are thousands of blog readers here. If 5% have household income over $200K, that's hundreds. If 5% of those feel like divulging their income, you might see 10 bears claiming they make that much. That can feel like a lot given the number of posts we have, and give the impression that "everyone here claims to be a millionaire". Lets not forget the thousands of us who are not posting our annual incomes here. Do you need the hundreds of us less-well-off bears to post to chime in to say "no we don't make that much"?

This is analogous to the "rich Asian foreigner" myth. You get the 10 Asians on TV paying over asking and the hundreds of locals who pay over asking don't get reported, and we think our town is taken over by foreigners. Same idea.