Off Off Topic: Cool Toronto People's Thread

[serge 904]

The areas outside of the core are still car-friendly, and nobody is really going to be able to change that. Nobody is really trying to.

 

Downtown Toronto should strive to be like Manhattan. Having a car there is downright silly. Toronto is pretty close. It's very walkable, and there's a decent supply of public transit.

 

Notice I said downtown, not Toronto as a whole. The outer suburbs will still be primarily car-based, and that's fine, but there's a ton of access points from which you leave your car, if you're going downtown.

 

I've never really understood this issue everyone has with condos. Mixing downtown with residents, businesses, commercial, is what needed to happen. Maybe we can talk about the urban design aspect, how they're almost homogenous at this stage, Maybe the ones by the waterfront failed to really address many of the issues there. I haven't been down there. If they're built like condo towers out north of the 401, then there's a problem, I imagine. If they were built on a grid with retail/commercial on the main floor, etc, then I would have no issue. Something I'd need to look into more.

 

Very true.

 

My "beef" with condos, is more what happens with respect to my business which is linked to the resale home market. I think personally the condo market is flooded downtown..While i dont think we will see a crash like some extremists predict, it cant be sustainable. They are also becoming over priced and they are pricing the regular downtown person out of the market.

 

Lot of foreign money is pouring in to buy these condos, also a lot of people are buying as speculation for investment.

 

Ill give you an example. I deal with a lot of first time homebuyers, young single people working downtown. Earning a modest income $50-$60000...Lot of these people dont have a huge downpayment, unless the parents are chipping in. They typically have a budget of $200000 to $225000.

 

Just finished two of these deals from beginning to end. Both of the women( in there later 20s) wanted to live downtown. But for the price they couldnt find anything that they liked. So one but in Mississauga and the other in Scarborough.

 

The one in scarborough she paid $215000 for a decent modest sized condo. Her mortgage payment is LESS than her maintenance fees.

 

The thing we dont understand is there is so much product, but it sells and another one goes up. Prices are still high. Where do we see the end?

[Zach6668 513]

People making that much money would be smarter to rent, especially young single people who will have rapidly changing family/economic conditions in the near future.

 

Serge, what do you think about this?

 

The Economist Who Just Won a Nobel Prize Thinks Owning a Home Is a Terrible Investment

 

See also:

http://www.businessinsider.com/nobel-prize-robert-shiller-housing-not-great-investment-2013-10

http://www.truthdig.com/eartotheground/item/nobel_prize-winning_economist_says_buying_a_house_is_a_bad_idea_20131016?ln

[serge 904]

People making that much money would be smarter to rent, especially young single people who will have rapidly changing family/economic conditions in the near future.

 

Serge, what do you think about this?

 

The Economist Who Just Won a Nobel Prize Thinks Owning a Home Is a Terrible Investment

 

See also:

http://www.businessi...estment-2013-10

http://www.truthdig....dea_20131016?ln

 

I dont know..

 

The article is US centric and might not apply to here..We never had a housing boom in Canada..Just steady increase in prices.....

 

I still believe the best invesment you can make is a home, because you will keep the investment for decades.

 

Who am I to argue with a nobel peace prize winner, but I dont agree in the general sense.

 

For some people it might be better to rent...Its different for everyone...

 

If you have say $50000 sitting in your savings and you are renting, it makes no sense in my opinion. I understand that maybe for a single person, who is transition in life and will change his/her circumstances in 3-5 years, maybe.

 

Our selling point when we are talking to clients is , why pay for someone elses mortgage...But it doesnt necessarily have to apply to everyone.

 

I personally have never rented, gone from my parents home straight to home ownership..But again, its not the same for everyone.

 

Especially these days where its getting much more difficult to qualify for a mortgage from an A lender, as the criterias have gotten more stringent and tougher.

[Dubey 1,035]

His ideas make sense if you are talking purely from an investment standpoint. There are a lot of other things to consider when deciding to buy or rent though. Unless there is a huge cost savings to renting a comparable residence that you can afford to mortgage, I think buying is the way to go for most people.

[Zach6668 513]

I would only buy if I was settled in, and planned on living somewhere for 10+ years.

[Dubey 1,035]

I think most people are terrible at saving/investing, so buying a house is a good way to lock up money for the future for the majority of people.

[FCP Bob 1,312]

I think most people are terrible at saving/investing, so buying a house is a good way to lock up money for the future for the majority of people.

 

this is a very important point in the debate.

[Zach6668 513]

absolutely.

[serge 904]

I think most people are terrible at saving/investing, so buying a house is a good way to lock up money for the future for the majority of people.

 

especially when there are no viable safe options.

 

Banks dont give you enough interest to keep up with inflation, mutual funds are still a risk, and the stock market is like betting on sports.

[Dubey 1,035]

I mean, if a mortgage is going to cost you $1500/month, and rent is $1000, and you take that $500 and put it into a TFSA or somewhere every month, and never touch it, it would have been a better investment (edit: 'investment' might be a bad word here) than buying a house over the last 6 years or so in most cases. but most people aren't capable of doing that, and will instead spend that extra $500 every month if it isn't committed to a mortgage.

[FCP Bob 1,312]

Just to give a real World illustration of where I live in Scarborough. We just bought a condo town house in the same complex we are currently renting in. 3 bedrooms with a den about 1600 sq ft with 2 underground parking spots and a storage locker. Tridel built about 18 years ago with the usual, indoor pool, gym, billiards room and security gate access to the complex. The unit we bought they probably spent $15K on some renovations in the kitchen with all new appliances and entire place freshly painted. They staged it and nobody is currently living there until we move in. Now we'll probably spend about $10k on some new flooring and a few other things as well.

 

Rent is $1940 per month.

 

Buy one for about $375K, with a 35% down payment interest portion of the mortgage is about $530 per month plus another $800 per month for property taxes and condo fees means it makes a lot of sense to buy and stay living in the same complex since we really like where we are.

[serge 904]

Just to give a real World illustration of where I live in Scarborough. We just bought a condo town house in the same complex we are currently renting in. 3 bedrooms with a den about 1600 sq ft with 2 underground parking spots and a storage locker. Tridel built about 18 years ago with the usual, indoor pool, gym, billiards room and security gate access to the complex. The unit we bought they probably spent $15K on some renovations in the kitchen with all new appliances and entire place freshly painted. They staged it and nobody is currently living there until we move in. Now we'll probably spend about $10k on some new flooring and a few other things as well.

 

Rent is $1940 per month.

 

Buy one for about $375K, with a 35% down payment interest portion of the mortgage is about $530 per month plus another $800 per month for property taxes and condo fees means it makes a lot of sense to buy and stay living in the same complex since we really like where we are.

 

This is a great example, the only problem is a lot of people in the rental market do not have 35% downpayment.

 

No brainer if you do.

[Dubey 1,035]

yikes, I'm glad I live in Alberta. My 1300 sq foot 3 bedroom townhouse condo was $220k. condo fees/property taxes total about $275/month. to rent the same unit would be about $1350/month plus utilities.

[MapleLeafpoker 1,462]

I would only buy if I was settled in, and planned on living somewhere for 10+ years.

 

Can I ask why? Especially why the "10+" timeline matters?

 

Im in agreement with Serge, Im a big proponent of buying in almost every case except 2.

 

1. You cant afford it

2. You have a way of making money with money that is higher than your mortgage rate

 

Also, I have never in my life locked in with an interest rate. With the way the economy has been recently, I cant imagine why you would. Real estate has been an incredible investment the last 15-20 years.

 

Again, this is Serge's field, but I also have been hearing that the condo market was over saturated for 10 years. I'm amazed that it isn't with the construction going on, but it keeps going up, and people keep wanting to buy these places. I know a lot of it is foreign investment, but that FI for now has been able to find someone to take it off their hands after closing, so so far, so good.

When I bought my house in 2002, I kept hearing the housing market was going to collapse soon. Nothing but up since.

[Zach6668 513]

Just because of the up front costs of buying a house. It needs to be a long-term thing. Maybe 5+ years is more appropriate. I don't really know.

[mrdannyg 274]

I would only buy if I was settled in, and planned on living somewhere for 10+ years.

 

I did a class that related to this in university - if you ignore period's where interest rates were above 10%, the breakeven period for buying is less than 5 years. Basically, if you commit to living in the same place and locking in a 5-year term (since usually those are the bank's best rates), then your equity gains will overcome extra expenses related to taxes, closing fees, etc.

 

Note that this does not change the rent/buy decision, as the above assumes both are at economically efficient rates. There are plenty of reasons why the prices are actually out of whack, and so it may still make more sense to rent.

 

I think most people are terrible at saving/investing, so buying a house is a good way to lock up money for the future for the majority of people.

 

Def.

 

I mean, if a mortgage is going to cost you $1500/month, and rent is $1000, and you take that $500 and put it into a TFSA or somewhere every month, and never touch it, it would have been a better investment (edit: 'investment' might be a bad word here) than buying a house over the last 6 years or so in most cases. but most people aren't capable of doing that, and will instead spend that extra $500 every month if it isn't committed to a mortgage.

 

True, though people are also terrible at buying real estate on a speculative basis, so some of the "investment" may wash out. Since you can put money in an RSP and take a chunk out to buy your first home, there is a lot of benefit for people looking for their first to wait.

 

Sure..I have heard stories of him being at a party of a very close friend of mine, and him seeing him do drugs..But the way he has been attacked by the media, with essentially circumstantial evidence is not right.

 

"Circumstantial evidence" is not "being on video smoking crack". That's just plan ol evidence.

[FCP Bob 1,312]

Yah to add the land transfer tax for Toronto on a $375K property is $7575

[serge 904]

Can I ask why? Especially why the "10+" timeline matters?

 

Im in agreement with Serge, Im a big proponent of buying in almost every case except 2.

 

1. You cant afford it

2. You have a way of making money with money that is higher than your mortgage rate

 

Also, I have never in my life locked in with an interest rate. With the way the economy has been recently, I cant imagine why you would. Real estate has been an incredible investment the last 15-20 years.

 

Again, this is Serge's field, but I also have been hearing that the condo market was over saturated for 10 years. I'm amazed that it isn't with the construction going on, but it keeps going up, and people keep wanting to buy these places. I know a lot of it is foreign investment, but that FI for now has been able to find someone to take it off their hands after closing, so so far, so good.

When I bought my house in 2002, I kept hearing the housing market was going to collapse soon. Nothing but up since.

 

I am also amazed at how we havent seen a crash, or at least a serious correction. Some people have been predicting it for years, but it just hasnt happened, and maybe wont ever happen.

 

But buying a condo now and hoping to flip it before closing for a huge profit(like it was done for a while) , not sure that we will see a lot of it.

 

Oh and Zach..Hate to be depressing but, I sit down with young couples all the time and I KNOW FOR A FACT 50 percent of them will call me within 5 years to say, they need help because they are getting a divorce. Most people think they are good 5-10-20 years, and circumstances change..Failed marriage, more kids, job relocation etc.

 

I get this call all the time..Its great for business, but I hate it everytime I get it...

[iBeaver 409]

We rent. We weren't locking ourselves into a house when at the time houses weren't selling and the fact that we had to get the Jin the baby situation figured out before we planted our roots. We might buy next spring though since we will be decided in where we want to be.

[serge 904]

I did a class that related to this in university - if you ignore period's where interest rates were above 10%, the breakeven period for buying is less than 5 years. Basically, if you commit to living in the same place and locking in a 5-year term (since usually those are the bank's best rates), then your equity gains will overcome extra expenses related to taxes, closing fees, etc.

 

Note that this does not change the rent/buy decision, as the above assumes both are at economically efficient rates. There are plenty of reasons why the prices are actually out of whack, and so it may still make more sense to rent.

 

 

 

Def.

 

 

 

True, though people are also terrible at buying real estate on a speculative basis, so some of the "investment" may wash out. Since you can put money in an RSP and take a chunk out to buy your first home, there is a lot of benefit for people looking for their first to wait.

 

 

 

"Circumstantial evidence" is not "being on video smoking crack". That's just plan ol evidence.

 

The whole RRSP first time home buyers thing is not really THAT great...Its great if you have no other money and all your money is in RRSPs..

 

Because you are just BORROWING from your RRSP, as that money has to be replaced over 15 years. But yeah it is an incentive..

 

We actually advise SOME clients to take out an RRSP loan, put the money into an RRSP and take it out right away..You get the immediate tax saving..The money has to stay in for 90 days.

[MapleLeafpoker 1,462]

Oh and Zach..Hate to be depressing but, I sit down with young couples all the time and I KNOW FOR A FACT 50 percent of them will call me within 5 years to say, they need help because they are getting a divorce. Most people think they are good 5-10-20 years, and circumstances change..Failed marriage, more kids, job relocation etc.

I get this call all the time..Its great for business, but I hate it everytime I get it...

 

Ya, I have another friend in the same business as you Serge, I saw him get the same call the last 2 times we were together.

He says he gets it so often, its staggering.

 

Maybe thats why the condo/housing market will never burst. Immigration+Divorce. Keys to a booming market!

[serge 904]

Ya, I have another friend in the same business as you Serge, I saw him get the same call the last 2 times we were together.

He says he gets it so often, its staggering.

 

Maybe thats why the condo/housing market will never burst. Immigration+Divorce. Keys to a booming market!

 

You have a good point..

[Babying 613]

The whole RRSP first time home buyers thing is not really THAT great...Its great if you have no other money and all your money is in RRSPs..

 

Because you are just BORROWING from your RRSP, as that money has to be replaced over 15 years. But yeah it is an incentive..

 

We actually advise SOME clients to take out an RRSP loan, put the money into an RRSP and take it out right away..You get the immediate tax saving..The money has to stay in for 90 days.

You talk like an Accountant

[Fenxis 99]

Ya, I have another friend in the same business as you Serge, I saw him get the same call the last 2 times we were together.

He says he gets it so often, its staggering.

 

Maybe thats why the condo/housing market will never burst. Immigration+Divorce. Keys to a booming market!

 

Also aging population... if I was a snowbird living 5months + 30 days a year down south somewhere I'd rather own a condo than a house!

[Zach6668 513]

 

 

Ya, I have another friend in the same business as you Serge, I saw him get the same call the last 2 times we were together.

He says he gets it so often, its staggering.

 

Maybe thats why the condo/housing market will never burst. Immigration+Divorce. Keys to a booming market!

 

The persons per household rate has dropped dramatically over the last few decades.