Can’t save a dime?

The Vancouver Sun has some good tips for people who are completely unable to save up for the largest purchase of their life.  People who either spend too much on entertainment and shopping or simply don’t earn enough to save.  Buy a house.

Yes. Because the people that should be buying real estate are people who are unable to save up a few thousand dollars.

Their advice ranges from the ridiculous (reign in spending habits) to the sublime (ask mommy and daddy for a down payment).

Saving money for a down payment, especially in British Columbia’s high-priced housing markets, is one of the biggest challenges that homeowners face, but mortgage experts say, it’s not impossible.

The minimum down payment new homeowners need is five per cent of a home’s purchase price, which can be particularly difficult to accumulate for those in the most need: young people, often with student debt and lifestyles that involve a lot of restaurant meals and going to movies once or twice a week.

Yeah, that’s 5 percent goal is super-tough, but it just might be achievable according to ‘mortgage experts’.  You can always tap into your RRSPs, and don’t forget that you can get yourself a zero-down loan (we call them ‘cash-back’ mortgages).

…some lenders have a cashback option that can be used against a down payment. “The clients have to take posted rates [not discounted] and some lenders will give you five per cent of the mortgage amount as cash back. On $400,000 that would be $20,000, the five-per-cent down payment that is required.”

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parisiene
parisiene
8 years ago

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Anonymous
Anonymous
8 years ago

@McLovin: “The big difference between SF, Sydney and Vancouver is one has 251 days of rain. Can you guess which one?”

Ya, but we have much better weed – which is essential when paying the ridiculous prices here.

JR
JR
8 years ago

@Anonymous: http://housing-analysis.blogspot.ca/2012/04/greater-vancouver-market-snapshot-march.html Anonymous #88 from yesterday’s post. I find the content of these graphs to be very interesting and a considerable departure from 2011. There is lots going on right now.

Bailing in BC
Bailing in BC
8 years ago

@Arthur Fonzarelli: Arthur, just rent! The easiest way to pay off 100k of your mortgage in one year is to wait a year and buy 100k cheaper. The scariest thing about the Squamish market is a massive overhang of houses over 600k that are not selling. Check out these graphs and pay close attention to the graph showing year to date sales by price range. http://www2.topproducerwebsite.com/users/34449/downloads/REBGVSQUAMISHMAR2012rebgv_area_charts_-_2012-03_squamish_graphs-listed_sold_dollarvolume.pdf There have only been 6 sales this year over 600k and the mls shows 88 properties currently listed. That’s 3.6 years of inventory. 64 of those listings are over 700k. That means there is 8 years of inventory for over 700k. There’s 44 houses listed over 800k. That’s 11 years of inventory. There’s 30 houses listed over 900k. Based on the last three months of sales it should take till the end of time… Read more »

jumpin in
jumpin in
8 years ago

UBC : 215 properties on the market!!!
Hampton place alone: 45. With only 66 for sale signs on the other side of 16th avenue.
This looks like the epicenter.

mac
mac
8 years ago

@Anonymous: Wow. No wonder they’ll dump their properties here once prices decline 7%.

Many Franks
8 years ago

Can anyone get me a sold price on 1954 East 1st Ave? It’s a thing of beauty — boarded up with spraypainted “DANGER DO NOT ENTER” signs and falling to bits where it stands. Some lucky soul bought it. Yeah, obviously it’s lot price only, but it would still make a pretty good poster child.

jumpin in
jumpin in
8 years ago

The rumour has it that HAM has migrated to Toronto, so we are toast. This is so ironic 🙂

Anonymous
Anonymous
8 years ago

I was in Whistler too, and what I noticed is an immigration agency promoting the investor program. It explained at length how to save $250,000 on tuition fees buy applying for a Landed Immigrant visa for each of your 3 kids (“And it includes free health care too”). I do not think HAM is a major marketing target there because there was no poster in Mandarin: only English and Spanish. Unless they only target people from Hong Kong.

Anonymous
Anonymous
8 years ago

@JR:

You mean the 2012 trends that are broadly the same as 2011? There’s nothing interesting going on right now.

mac
mac
8 years ago

Wait. Wait. Hang on. I want my comments to be voted up… the Chinese are all (and that’ll include 85% of the population of Richmond) going to leave once they see house prices come down. They’re all going to go back to Hong Kong, Taiwan, and the Mainland of course. For fresh air, good governance and low, low house prices.

mac
mac
8 years ago

@JR: Yeah. That’s a great analogy. One of my friends sold his Point Grey house last week for 4.3 million. Train is really coming off the tracks. Get ready for one opportunity it buy a leaky condo in the coming months. They won’t go down all that much and then, guess who will be there to buy the rest of them.

/dev/null
/dev/null
8 years ago

@patriotz: Thanks. That’s what I assumed.

On another topic, someone earlier linked to this realtor’s website (http://www.ginarossi.ca/) and I read the About page. She has a PhD in Molecular Biology and experience doing cancer research but she’s spending her time selling houses. I understand that doing a PhD is enough to make many hate science but it seems like a loss. But when reaearch pays crap and real estate pays well, what do you expect?

good-format
good-format
8 years ago
 Date      Listing  Price(+-)  Sold   Inv     Inv(+-)  S/L(%)
Mar-28       259     118       104   16,173     84     40.2
Mar-29       239     104       151   16,180      7     63.2

Apr-02       450     139       125   16,074            27.8
Apr-03       319     133       224   16,124     50     70.2
Apr-04       302     131       147   16,230    106     48.7
Apr-05       277     118       117   16,345    115     42.2

Apr-10       403     211       159   16,475    130     39.5

Total-Cur  1,751     732       772             401     44.1
5 day-avg    350     146       154              80     44.1
Total-Est  6,654    2782      2934   17,598  1,524     44.1

Historical April Sales and listing

       sales   listing   S/L
2001   2,253    3,556   63.4%
2002   3,785    5,215   72.6%
2003   3,095    4,139   74.8%
2004   4,106    5,665   72.5%
2005   4,043    5,731   70.5%
2006   3,345    4,452   75.1%
2007   3,490    5,724   61.0%
2008   3,218    7,010   45.9%
2009   2,963    4,649   63.7%
2010   3,512    7,648   45.9%
Mean   3,381    5,379   62.9%
RippedtoShit
RippedtoShit
8 years ago

JR, great analogy, I totally agree.

I’m going to use that, hope you don’t mind.

JR
JR
8 years ago

@Anonymous: Good point, except it still does not take away from the game-changing numbers amd resultant trends of 2012 so far. I really do think that this is the beginning of the end. Remember that real estate corrections are like train wrecks, where the first dozen or so cars including the engine seem to be on the tracks and moving along just fine. The cars derailing are out of sight of the largest majority of observers.

RippedtoShit
RippedtoShit
8 years ago

Anony,

McLovin SHOULD know that, but he spends most of his life on his knees with his eyes shut, so cut him some slack – please.

JR
JR
8 years ago

Might be time to change the name of this site to Vancouver Bubble Info

RippedtoShit
RippedtoShit
8 years ago

mac, you dolt.

don’t you know how basic math works?

buy a place for $500,000. Add $100,000 of upgrades. Sell it for $600,000…and dolt’s like you say the market’s up 20%

Go suck that egg. Try it, you’ll like it.

Anonymous
Anonymous
8 years ago

@McLovin:

Don’t forget that sales numbers are published with a delay. This weekends sales won’t show in the stats immediately. Somebody who has been here as long as you should know that already.

mac
mac
8 years ago

@Extremely rich,confident and proud, Van house owner.: And their mortgage rates are like 4-5%! And so far what do they have in Sydney? Like maybe a 2-5% decline after two years of putting on the brakes. It’s pathetic. Something else is holding it up. But you’re a wanker for saying you’re extremely rich, confident and proud Van house owner.

Extremely rich,confident and proud, Van house owner.

Crown’s Sunito Says Sydney and Vancouver Home Prices Will Keep Rising

mac
mac
8 years ago

@RippedtoShit: Zzzzzzz… I’ve heard all this before. What else ya got?

RippedtoShit
RippedtoShit
8 years ago

mac,

Interesting thoughts – you should discuss them with McLovin on Saturday night, although I suspect it will be pretty much a one way conversation given the nature of things. I guess you can’t fault him for how he makes a living, although I think its just plain nasty.

BRICs – I don’t disagree, by and large, but in time I think folks in the WEST will be clamouring to buy there…I don’t think our local market will be held up by HAM, for whatever reason they are in rather short supply these days..the worm has turned, as they say….and once price declines become endemic, the HAM will prove to be sheeple, just like all those who came before them.

Have fun on Saturday night, that’s a reasonable deal for twenty bucks, if thats what your into.

mac
mac
8 years ago

@RippedtoShit: I think the dog that’s having it’s day are the BRIC dogs…. Brazil, Russia, India, China. They’ve been considered the 3rd world for a long time now.

Let Hercules himself do what he may,
The cat will mew, and dog will have his day.

In other words even the strongest powers on earth (America?) can’t prevent the toppling of their society. They gave their economy away years ago and now the chickens are coming home to buy real estate all over the planet and roost.