Real estate in Calgary - another bubble?

[Muta]

Originally Posted by blankall

A fun party co-op? All the co-ops I've seen are the exact opposite. People who've been there the longest have the most sway on the co-op boards. They tend to be curmudgeony slightly older people who will cause a massive fuss if any kind of noise disturbs their pomeranian. Many will go as far as to exclude single and young people from their ownership.

The only place you'll find a good social scene for young people within a building is in a building where the landlord just doesn't care.

Co-ops aren't really ownership either. Typically the model is that you buy the share, and then pay upkeep costs. You're basically paying a reduced rent. You sell the share when you leave (if you can), but profits on that share aren't going to be huge. Most strictly prohibit any kind of rentals.

Fair enough, I do see your point. I just feel like under the right investment, development and structure, something like this could definitely work. Try to address those problems you've listed. I don't think it would be impossible.

[blankall]

Originally Posted by CliffFletcher

People with children don’t care for that. Or rather they prefer a detached house, and few can afford both. And that’s true of people starting families in Toronto and Vancouver as well, who are flooding into suburbs and bedroom communities.

Unless you're parents are giving you a $300k+ downpayment or your household income is $300k+, there is no chance that you are buying a house in Vancouver/Toronto. Even then most people can't afford the house until they are 40ish, as the amount of schooling you need to secure that high end job plus save the $400k for purchase takes a considerable amount of time. Is 40 considered young now? I was almost done high school when my parents were turning 40.

In Vancouver/Toronto even buying in a suburb is likely out of consideration for most young families. You're probably looking at $1.2 million starting price for a liveable detached property in the burbs. Detached houses in the burbs actually saw the greatest jump in prices during the pandemic. Price increasers of over 30%:

https://www.straight.com/news/home-p...e-buyer-demand

Honestly, a lot of the people who choose to live in Vancouver/Toronto aren't overly concerned with having a detached property. If you are living in these cities you value entertainment, walkability, restaurants, culture, etc... over at home motorcycle mechanics. Many people are having children, and would be totally satisfied with a 3 bedroom townhouse....the problem is that those don't really exist in most cities, especially Vancouver.

[The Big Chill]

Originally Posted by Cowboy89

Was the ask price realistic though? Ie, did it look like a deal at the list price and have wording in the listing such as (reviewing offers at XPM on X Day), etc.

I'm noticing that given the low inventory and strong demand that realtors are pricing good properties below intrinsic value to try to kick off bidding wars to drive offers that are free of conditions. On the surface it might look like people are paying $100,000 premiums but in reality it's something closer to (But still at a modest premium) what it would go for if priced more traditionally.

It was listed a bit low. It was a 1750 square foot house in the SE. listed at 500, sold for 600. We thought 550 was the market price, but that got blown away. The house was also 20 years old and had no updates done. It was really well lived in, to put it nicely. When we looked at it we thought there would be damn near a hundred thousand bucks of renos needed.

Today we are seeing 1300 square foot houses listed almost at 500.

[burn_this_city]

Are people with children overly concerned with walkability, entertainment, culture, and restaurants? I have a 2.5 year old and basically none of those rate highly on my pyramid of needs. People have different priorities at different phases of life. Even a multi bedroom inner city townhouse would be mediocre to raise my kid in compared to the lifestyle I grew up with. Small yard, traffic, constant supervision required.

Part of the reason condos have done so poorly here. They are primarily purchased or rented by younger adults without children. After oil crashed we shed a ton of young professionals and those who had their kept jobs moved on to the next phase in life, which meant trading upwards if possible to a SFH.

[Regorium]

Pandemic has really screwed with the demand for condos too. There is no reason to live downtown when there is nothing to do or if you're just WFH.

Just saw a listing for the same floorplan that I own selling for 35% less than what I paid for it. I truly believe this person is really desperate, and the real value is actually probably about a 20% loss.

Part of me wants to lowball the crap out of him and DCA down my condos, but I also never want to touch real estate in my entire life ever again.

[blankall]

Originally Posted by burn_this_city

Are people with children overly concerned with walkability, entertainment, culture, and restaurants? I have a 2.5 year old and basically none of those rate highly on my pyramid of needs. People have different priorities at different phases of life. Even a multi bedroom inner city townhouse would be mediocre to raise my kid in compared to the lifestyle I grew up with. Small yard, traffic, constant supervision required.

Part of the reason condos have done so poorly here. They are primarily purchased or rented by younger adults without children. After oil crashed we shed a ton of young professionals and those who had their kept jobs moved on to the next phase in life, which meant trading upwards if possible to a SFH.

I have a newborn. Commuting is a massive concern for me. As is free time, generally. I'm quite willing to pay a premium and live in a smaller place to not spend an extra hour of the day in a car. You're correct, I don't walk to bars as much as I used to. However, having amenities like gyms, grocery stores, daycare, all close is a massive priority.

I have a detached property, but really only because it's a good investment. I don't really care for the yard work. The maintenance on the house is crazy expensive and time consuming. If I could I would definitely buy a 3 bedroom townhouse close to the core, but Vancouver doesn't really have any of those.

As for the child's lifestyle, a major bonus of living in a densely populated area is the people. Kids love other people above all else. There are lots of parks in the area too. Once kids get to be 12+, the advantage of having entertainment options for them close becomes a massive thing.

[Cowboy89]

Originally Posted by The Big Chill

It was listed a bit low. It was a 1750 square foot house in the SE. listed at 500, sold for 600. We thought 550 was the market price, but that got blown away. The house was also 20 years old and had no updates done. It was really well lived in, to put it nicely. When we looked at it we thought there would be damn near a hundred thousand bucks of renos needed.

Today we are seeing 1300 square foot houses listed almost at 500.

Your story makes complete sense. If it's really worth $550,000, they priced it cheap to incent a bidding war. There might have been multiple offers in that situation and a few of them are people who think they might get a deal and offer below $550,000 but over list and never had any real hope of buying at their offer price. If priced fairly at $550,000 they might have never even looked at the property in the first place. This put pressure on the more serious bidders who are caught in a psychological dilemma because they want to 'win' the house and then bid at the top end of their affordability. End of the day realtor squeezes a ~10% premium due to the supply/ demand dynamics.

The interesting thing is what happens from here. Now potential sellers of comparable houses in that area are going to list or expect to get $600k.

[burn_this_city]

Originally Posted by blankall

I have a newborn. Commuting is a massive concern for me. As is free time, generally. I'm quite willing to pay a premium and live in a smaller place to not spend an extra hour of the day in a car. You're correct, I don't walk to bars as much as I used to. However, having amenities like gyms, grocery stores, daycare, all close is a massive priority.

I have a detached property, but really only because it's a good investment. I don't really care for the yard work. The maintenance on the house is crazy expensive and time consuming. If I could I would definitely buy a 3 bedroom townhouse close to the core, but Vancouver doesn't really have any of those.

As for the child's lifestyle, a major bonus of living in a densely populated area is the people. Kids love other people above all else. There are lots of parks in the area too. Once kids get to be 12+, the advantage of having entertainment options for them close becomes a massive thing.

We lived in a 1700sqft townhouse prior to our current home. We sold it prior to having our kid because the baby's room would be on a separate floor from ours, and the prospect of fencing in every level was going to be an issue. We had 3 stories plus a basement and decided it was too many stairs to raise a kid in. We had a decent sized yard but it was on a busy street and people ripped around all the time. I think stuff makes sense in the abstract until you really live it and realize it's not all its cracked up to be.

[Ozy_Flame]

I know a couple of fellow young families living in narrow homes in Trinity-Bellwoods and Christie Pits in Toronto, respectively. Price craziness aside, they want their kids growing up there because of the community and location. The houses are old, narrow, and tall (like we're talking 18-25 feet wide), but they choose to stay.

I think if they had the option for a larger or more spacious house in the areas, sure, why not, but for some families location and community are higher.

Everyone is different. I see the positives for both urban and suburban family living.

[Bunk]

Originally Posted by burn_this_city

Are people with children overly concerned with walkability, entertainment, culture, and restaurants? I have a 2.5 year old and basically none of those rate highly on my pyramid of needs. People have different priorities at different phases of life. Even a multi bedroom inner city townhouse would be mediocre to raise my kid in compared to the lifestyle I grew up with. Small yard, traffic, constant supervision required.

Part of the reason condos have done so poorly here. They are primarily purchased or rented by younger adults without children. After oil crashed we shed a ton of young professionals and those who had their kept jobs moved on to the next phase in life, which meant trading upwards if possible to a SFH.

As someone with young children, actually one of the biggest virtues of inner city living is the availability of schools. One of the problems we've had with brand new communities, is that the schools so often lag the development of the community. My kids will be 400m from their school from K-12.

[peter12]

There will come a point in the not-too distant future where suburban living and commuting to a core will be so expensive that most people will want to switch more dense, self-contained communities.

The suburbs are just a result of the petrochemical boom of the last 70 years. Their time is running out.

[blankall]

Originally Posted by Bunk

As someone with young children, actually one of the biggest virtues of inner city living is the availability of schools. One of the problems we've had with brand new communities, is that the schools so often lag the development of the community. My kids will be 400m from their school from K-12.

Schools are definitely a major issue. When my parents moved to Sundance in the late 80s, we had to be bussed into Chinook Park Elementary, which was a fairly massive burden to my whole family. Then once Junior High hit, the only non-religious schools, were also nowhere near our neighbourhood and somehow grouped in with Forest Lawn. The city had basically taken the new neighbourhoods, excluded them from the closer geographically closer neighbourhood, as not to upset the existing student body's parents, and put us in schools that no one else wanted to go to.

[Muta]

Yeah I went to Queen E. (in Hillhurst) from grades 7-12. Loved it there; lived a couple blocks from there, and so many places to go close by after school (Kensington, Bow View, the river path, etc.). Tons of kids that went there lived in Sandstone and other areas that far north - never really understood why, other that at the time, I think that was their designated school. That commute to and from school everyday must've been atrocious! Terrible school planning.

[Ozy_Flame]

This is timely

Toronto high-rise to house Ontario's first school in a condo

Downtown Toronto will soon welcome Ontario’s first-ever high-density, vertical school.

Today, Ontario’s Minister of Education, Stephen Lecce, and Kinga Surma, Minister of Infrastructure, unveiled plans for Lower Yonge Precinct Elementary School, the province’s first school to be created inside of a condo building. In collaboration with the Toronto District School Board and Menkes Developments, the future school will be located within the mixed-use Sugar Wharf Condominiums project at Lake Shore Boulevard East and Yonge Street near Toronto’s waterfront.

“I am so proud to announce that Menkes will be bringing Lower Yonge Precinct Elementary School to our Sugar Wharf Development,” said Jared Menkes, executive vice president of high-rise residential at Menkes Developments, in an Instagram post.

“This will serve the future waterfront community - an amazing milestone for the [City of Toronto], and of course for the many young families who have transitioned to high rise living. Urban families can count on having a school close to work and home,” he added.

[burn_this_city]

Originally Posted by peter12

There will come a point in the not-too distant future where suburban living and commuting to a core will be so expensive that most people will want to switch more dense, self-contained communities.

The suburbs are just a result of the petrochemical boom of the last 70 years. Their time is running out.

Yeah maybe if we don't transition at all and everyone is back to the horse and buggy. If commuting becomes prohibitively expensive, companies will be forced to adapt to attract talent and will have satellite campuses or wfh.

[Slava]

Originally Posted by The Big Chill

It was listed a bit low. It was a 1750 square foot house in the SE. listed at 500, sold for 600. We thought 550 was the market price, but that got blown away. The house was also 20 years old and had no updates done. It was really well lived in, to put it nicely. When we looked at it we thought there would be damn near a hundred thousand bucks of renos needed.

Today we are seeing 1300 square foot houses listed almost at 500.

Honestly, not that you should take anonymous advice from someone on the internet, I'd try to hold off for a while and wait for inventories to become closer to average. I realise there are a million factors here, not the least of which could be a realtor telling you that you need to "buy now because you're out of the market and what if it rockets up?!?!"

But looking ahead, spring would generally have more listings and more homes on the market. Interest rates could well rise within the week or in March, depending on who you listen to regarding that. I think both of those might be better. (And of course you can get rates locked in to protect yourself in that event...)

[Table 5]

We recently switched out from a newish semi-detached infill (ie your typical 3 story narrow box duplex) in a great inner city community to a fully-detached older home slightly further out...for about 5-10% increase in cost, and are pretty satisfied with the move. The infill was a great for us to raise 2 small kids out of, but we had outgrown it the last few years...not necessarily because of size, but more in terms of the layout (it felt like living in a really tall railroad car and we were always on separate floors). There were also some noise/crime issues on our street that were starting to get a bit out of hand because of us being so close to a main street...it wasn't the primary reason, but it certainly didn't help.

Even though our house is older (1930) I have to say from an "investment" perspective, I'm much more comfortable with having my money be mostly tied to the land, as opposed to the building that sits on it, or silly things like finishings. Our infill was a ticking-time bomb...it looked great at the start, but construction quality was suspect, and I was never fully comfortable with having my biggest asset directly tied to a stranger.

As a family of two kids, things we prioritize: Easy access to schools, parks/activities, safety, having other families around, character, elbow room, good value.
Zero effs given about: Easy access to restaurants, nightlife, culture hotspots. Not that we don't like those things...but we rarely get to take advantage of those things in our day to day life, so they are down the list of priorities and not something we need to pay for. On the off chance we go to a restaurant, it's not a tragedy if we have to drive.

[Cecil Terwilliger]

Originally Posted by getbak

A unit in my building was listed just before the New Year and sold in less than a week at asking price. So, there is some life in the condo market.

I sold my condo in a week during the height of the pandemic in 2020.

I think location, the condition the unit is in and, most of all, the asking price are the key factors. Condos are always in demand for the right price.

[peter12]

Originally Posted by burn_this_city

Yeah maybe if we don't transition at all and everyone is back to the horse and buggy. If commuting becomes prohibitively expensive, companies will be forced to adapt to attract talent and will have satellite campuses or wfh.

We have busses and trains.

[CliffFletcher]

Originally Posted by blankall

Unless you're parents are giving you a $300k+ downpayment or your household income is $300k+, there is no chance that you are buying a house in Vancouver/Toronto. Even then most people can't afford the house until they are 40ish, as the amount of schooling you need to secure that high end job plus save the $400k for purchase takes a considerable amount of time. Is 40 considered young now? I was almost done high school when my parents were turning 40.

Most are getting help from their parents. I think that’s well-established. It’s amazing how generous the bank of mom and dad becomes once grandkids enter the picture.

Originally Posted by blankall

In Vancouver/Toronto even buying in a suburb is likely out of consideration for most young families. You're probably looking at $1.2 million starting price for a liveable detached property in the burbs. Detached houses in the burbs actually saw the greatest jump in prices during the pandemic. Price increasers of over 30%:

What does that show us? It shows us that even at those eye-watering prices, couples will do whatever it takes - beg, borrow, steal - to get into a detached home. They’ll take on $600k more in debt to upgrade from a downtown condo to a suburban family home. Living in the high density city centre was just a transitional lifestyle phase.

The flight from urban centres during the pandemic also shows us that a great many people with property there did not love the lifestyle, but only lived in the inner city because it was convenient for work. Remove or reduce the need to go into the office and the utility of living close to the office goes down.