06-08-2011, 02:05 PM
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#1901
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Franchise Player
Join Date: Feb 2006
Location: Toledo OH
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Quote:
Originally Posted by hulkrogan
The thing is, as it sits, it hasn't done all that well. It's been a relatively short term hold, and one more year of mortgage payments paying down the principle puts it in a decent spot. Before that, and with a huge penalty if it gets sold earlier, it doesn't look so good.
I guess I have to decide if I think the odds are good of the value of the property dropping more than the penalty ($9-$10K) plus the amount of principle that will be paid off ($6K).
The money would go straight into other investments. I've got a crapload of unused RRSP room right now.
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I wouldn't factor in the principal payments you would otherwise make into the analysis. Theory would dictate that selling now would not take that away from you as you would have that money either way. Too often when people sell their homes nominally higher than what they paid for them they mentally count their principal payments as 'profit.' The interest portion of your payments on the other hand is a different story as you won't have to pay that if you sell.
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06-08-2011, 02:06 PM
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#1902
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My face is a bum!
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Quote:
Originally Posted by Cowboy89
I wouldn't factor in the principal payments you would otherwise make into the analysis. Theory would dictate that selling now would not take that away from you as you would have that money either way. Too often when people sell their homes nominally higher than what they paid for them they mentally count their principal payments as 'profit.' The interest portion of your payments on the other hand is a different story as you won't have to pay that if you sell.
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It's a rental, so someone else is paying down that principle for me.
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06-08-2011, 02:09 PM
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#1903
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Franchise Player
Join Date: Feb 2006
Location: Toledo OH
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Quote:
Originally Posted by hulkrogan
It's a rental, so someone else is paying down that principle for me.
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Gotcha, makes more sense to me now.
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06-08-2011, 03:29 PM
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#1904
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Franchise Player
Join Date: Mar 2005
Location: Van City - Main St.
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Fascinating how interesting Real Estate investment can be. While some are afraid to hold on to property for the next year, some of us are extending our rental agreements (with our tenants) and picking up more properties cause we want to wait longer.
Someone must have the crystal ball!!
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06-08-2011, 03:32 PM
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#1905
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Franchise Player
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Quote:
Originally Posted by hulkrogan
The thing is, as it sits, it hasn't done all that well. It's been a relatively short term hold, and one more year of mortgage payments paying down the principle puts it in a decent spot. Before that, and with a huge penalty if it gets sold earlier, it doesn't look so good.
I guess I have to decide if I think the odds are good of the value of the property dropping more than the penalty ($9-$10K) plus the amount of principle that will be paid off ($6K).
The money would go straight into other investments. I've got a crapload of unused RRSP room right now.
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It seems to me that this would be an ideal candidate for doing an "Agreement for Sale" or AFS. Basically, you agree to lease your property to another investor for the next year at an amount that covers your costs, plus take a deposit from them against the future sale price, which you agree on now. It's essentially a combination of a lease (to someone who will keep your current tenant) and a sale that takes a long time to close.
The advantages for you are you get out of paying a penalty and get a year of mortgage paydown. If the buyer can't close you keep their deposit. (I'd aim for 5-10% of the purchase price)
The advantages for the buyer are that they can get into a rental property with 10% down and have another year to save the other 10% needed to qualify for a rental property mortgage.
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06-08-2011, 03:49 PM
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#1906
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Franchise Player
Join Date: Dec 2006
Location: Calgary, Alberta
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Quote:
Originally Posted by fotze
I 'll take my guaranteed -3% on my mutual funds thank you very much.
Is there a way to check the government databases to see how much I have contributed to RRSP's over the years? After all the different advisors and funds and moving stuff here and there, I have no idea. I would like to compare what I contributed compared to what it is worth today? Not sure it is much better than in real estate.
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-3? That sucks! I know a guy who can promise way more and turn that into -6% in no time!
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06-08-2011, 03:56 PM
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#1907
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First Line Centre
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Quote:
Originally Posted by hulkrogan
Kind of comforting to see that we may have gotten a bunch of our correcting over with early.
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From the actual BMO report that article references; 10 years ago Calgary's income to price ratio was 2.8 while the national average was 3.2. The economy may not have been "booming" 10 years ago but Calgary was still far from being a welfare city at the time. I can't help but think that Calgary's urban sprawl played a role in keeping Calgary's house prices "down" past and present...
Houston's house prices, which never boomed, are incredibly cheap when compared to lots of the US and especially those areas with a similar economy. This article discusses how Houston's lack of zoning and huge sprawl has helped the affordability in Houston.
Could council's attempts to make suburban development more expensive and rezone inner city neighbourhoods, both of which would reduce SFH supply, further cushion the blow?
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06-08-2011, 05:55 PM
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#1908
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Franchise Player
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Quote:
Originally Posted by Slava
-3? That sucks! I know a guy who can promise way more and turn that into -6% in no time!
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RIM is down like -3 just today alone (and you can nearly draw a straight line on it for the last 4-5 months.)
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06-08-2011, 05:59 PM
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#1909
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#1 Goaltender
Join Date: Nov 2005
Location: An all-inclusive.
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Quote:
Originally Posted by chemgear
RIM is down like -3 just today alone (and you can nearly draw a straight line on it for the last 4-5 months.)
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Are you saying that there may be fewer openings at rim.jobs?
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06-08-2011, 06:34 PM
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#1910
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Franchise Player
Join Date: Dec 2006
Location: Calgary, Alberta
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Quote:
Originally Posted by chemgear
RIM is down like -3 just today alone (and you can nearly draw a straight line on it for the last 4-5 months.)
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I'm not sure what I would buy first though, real estate or RIM? Maybe real estate....
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06-13-2011, 08:38 AM
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#1911
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Franchise Player
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Hmmm, that "spring surge" in pending sales looks to have dropped off pretty darn fast already - now just slightly above the 2010 levels again. Could pick up again, maybe the nice weather will get people to go look at homes?
And this should be interesting:
http://www.theglobeandmail.com/repor...rticle2057571/
The press release from the central bank saying Mr. Carney would address a sold-out Board of Trade meeting on Wednesday elicited squeals of glee from many market watchers, especially those who spend a lot of time warning others that Vancouver’s housing market is bound to crash in a spectacular manner (any day now).
While the warnings used to come from contrarians yelling from the fringes, there has been a sudden surge in bubble-related cautions from the country’s banks and economists. Even smug Torontonians take time away from gossiping about neighbourhood bidding wars to wag their fingers at the West Coast.
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06-14-2011, 09:49 AM
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#1912
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Franchise Player
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http://www.vancouversun.com/Househol...629/story.html
"And the financial situation of certain groups of households is much worse than average and continues to deteriorate. This is concealed if you focus only on the national or aggregate picture."
- Savings rates inched down in 2010 and continue to cause concern. Twenty-seven per cent of non-retired Canadians commit no resources whatsoever to savings, even for retirement
The report shows that more than half of indebted Canadians are borrowing money just to meet their day-to-day living expenses.
As a result, single-parent families, retirees and those with annual income of less than $50,000 "face a bleak financial situation," the report warned.
It also said that if household debt was spread evenly across all Canadians, a family with two children would owe an estimated $176,461.
Here is the link to the actual report:
http://www.cga-canada.org/en-ca/Rese...default.aspx#1
http://www.cga-canada.org/en-ca/Rese...onsumption.pdf
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06-16-2011, 12:44 PM
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#1913
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Franchise Player
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Mark Carney was in Vancouver of all places on Wednesday:
http://business.financialpost.com/20...f-the-canucks/
Mark Carney came as close as any central banker ever could on Wednesday to saying some parts of the Canadian housing market are in a bubble.
Cut through the bankspeak and Mr. Carney also said some parts of the housing market may be acting like a classic financial bubble, with expectations of rising prices and ever higher returns driving dynamics rather than supply and demand.
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06-16-2011, 05:21 PM
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#1914
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Scoring Winger
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^ Given that economic models are not able to predict the Vancouver housing market, how about this:
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06-17-2011, 03:11 PM
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#1915
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My face is a bum!
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^ I was just coming here to post that. If someone is looking to move to Canada and was deciding between Toronto and Vancouver, did they just have their mind made up?
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06-17-2011, 04:20 PM
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#1916
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Franchise Player
Join Date: Mar 2005
Location: Van City - Main St.
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I brought that up on a Real Estate forum I follow. Will be interesting to see if this has any effect on the Vancouver Real Estate market.
Most people seem to think it won't, but I wouldn't be surprised if there's a small effect considering how much foreign investment we get.
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06-17-2011, 05:56 PM
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#1917
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Franchise Player
Join Date: Jan 2010
Location: east van
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Quote:
Originally Posted by hulkrogan
^ I was just coming here to post that. If someone is looking to move to Canada and was deciding between Toronto and Vancouver, did they just have their mind made up?
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Its true, Toronto would seem to be safe from playoff related riots for decades to come.
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The Following 2 Users Say Thank You to afc wimbledon For This Useful Post:
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06-17-2011, 08:07 PM
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#1918
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Franchise Player
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Quote:
Originally Posted by afc wimbledon
Its true, Toronto would seem to be safe from playoff related riots for decades to come.
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Haha!
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06-20-2011, 06:21 PM
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#1919
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Franchise Player
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Looks like the pending sales in June have dropped off already, things trending back closer towards 2010 numbers again.
Meanwhile the debt keeps piling up and wages haven't increased to keep pace.
http://www.theglobeandmail.com/repor...rticle2067705/
The ratio of household credit market debt -- including mortgages, consumer credit and loans -- to disposable income rose to 147.3 per cent in the first quarter, surpassing the revised 146.2 per cent mark in the fourth quarter of 2010.
In fact, Canadian debt ratios are now “leaving their U.S. counterparts in the rear-view mirror, despite the repeated exhortations by domestic policymakers to rein in borrowing,” said Douglas Porter, deputy chief economist at BMO Nesbitt Burns.
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06-29-2011, 11:54 AM
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#1920
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Franchise Player
Join Date: Mar 2005
Location: Van City - Main St.
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Canadian Housing Bubble Close to Bursting?
According to Capital Economics it is.
Calgary Herald Story
Can't believe I beat Chemgear to posting this story!
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The Following 2 Users Say Thank You to Winsor_Pilates For This Useful Post:
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