It's amazing how much the trailing returns affect people's perception of what the right course of action is.
Exhibit A: The Vancouver perspective. After years of going straight up, Vancouver RE is now very, very expensive. But that's meant that buying ANYTHING has been the right choice.
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Originally Posted by Winsor_Pilates
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They would have been way better off getting something (condo or townhouse) when they had 150k down, gaining market equity, not paying rent and then upsizing once they saved more + using the gained equity.
Waiting and saving in Vancouver has proven to hurt people as you're chasing a moving target that goes up faster than people can save.
This is why it's not very common.
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Exhibit B: The Calgary perspective. Condos are down over the last 10 year period. But they're so cheap now that it's really, really unlikely (imo!) that they will repeat anything close to that performance over the next 10 years.
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Originally Posted by Hemi-Cuda
Except condos are a terrible purchase and could cause you to be tied down if you ever want to move up. You're better off renting
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Not meant to be a dig at either poster - they're both 100% correct for a certain set of circumstances.
I just think over the next 10 years the right choice might be opposite for the two geographies. Renting a Vancouver condo is so much cheaper than owning at this point that I don't see how the difference ever gets made up. The appreciation required to just break even would be huge.
Whereas owning a Calgary condo is very cheap relative to rent. Even if values stay flat (at current low prices) you're going to make out OK just from mortgage paydown. And with oil prices finally recovering and the Transmountain expansion getting built, I think there's the potential for upside. It doesn't need to be an old style 40% in one year boom, but a couple of 5%+ years in a row on a condo is a pretty nice shortcut on saving for a detached house if that's the end goal.
YMMV, not advice.