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| $60,000.00 cash down & still not enough!
Posted: 9/23/2007 8:48:56 PM |
So, buying a home today, IS, no longer an asset, it IS, a liability, that comes with a LONG TERM mortgage, and if you cannot pay it off, the lending companies will foreclose on you, and ya lose EVERYTHING.
Sorry, but I have to disagree here......a home is always an asset, providing you are living within your means, because you are building equity, rather than handing over your hard earned cash to your landlord! If you rent, you have nothing anyways, so what's your point. I chose to buy, because for an extra $100 a month, I could own the same size home, that I would have rented. Yeah, I'm responsible for repairs, etc, but the value of my home has doubled in less than 4 years, so even if I was forced to sell, I would still be ahead of the game! | |
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| $60,000.00 cash down & still not enough!
Posted: 9/24/2007 8:09:40 AM | and i totally disagree also ...well I hear a lot of people talking about what a liability it is owning a home on here ,,what a crock,,the people who have made mortgage payments on there condo or apartment the past 5 years instead of rent are walking away with over 100,000 in equity in there pockets ,,and thats a very conservative estimate of the profits being made ..
as far as 60,000 not being enough for a down payment ? start smaller ..there are apartments and 2br condo's out in the Fraser valley still under 200,000 so you dont need 150,000 a year to qualify for a 160,000 mtg..lets get real here people.. half that income will cover a mortgage that small ..sounds like the typical complainers on here who didn't want to pay the price 5 years ago and missed the boat .take a look on MLS website and search for property under 200,000 .. | |
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| $60,000.00 cash down & still not enough!
Posted: 9/24/2007 9:29:46 AM | Yes, I also have to disagree here.
As long as you are living within your means, as humble as that might be, you should be fine. If you were smart enough to buy before 2004, you could buy a place whereby with a negligible downpayment, the mortgage amount would be equal to the rent. Now it's a bit of a different story.
Also, if you bought before 2004, your place probably doubled. And if it was your principal residence, and you were to cash out, you would probably be eligible for the "Principal Residence Tax Exemption", which would allow you keep the profit on the sale 100% tax free.
Why in the world world would anybody say "owning their own home is not a good investment" is beyond my comprehension.
PS. yes there are repairs, maintenance, etc. but if you were a Tenant, those costs would be passed on to you so you aren't getting a free ride. There are no "free rides". | |
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| $60,000.00 cash down & still not enough!
Posted: 9/24/2007 10:17:37 AM | | yes sir raffarott things doubled ,,it didnt matter if it was an apartment or a house ,,with or without land ,,tax free earnings ,,(better whisper that statment they are always looking for a new tax grab ) | |
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| $60,000.00 cash down & still not enough!
Posted: 9/24/2007 3:13:47 PM | Banks have always done appraisels and values are based on current market conditions. The market was going up weekly a couple of years ago well now it more of a monthly thing. I find it interesting how people are balmeing realtors for the high prices. No property would sell without the buyer and seller agreeing on a price. Very simple. Take responsibility for your own actions.
I heard a realtor talk on the radio a couple of years ago who had been in the business for 35 years and he said an interesting comment.
" Buyers always think the price is too high"
Think about that because four years ago when property's were half the price, buyer's said the price was too high .
Als0 if you put a down payment of $50,000 of a purchase price of $300,000 and the values go up 5% a year then in 5 years how much would you have made?
15,000 year 1
15,750 year 2
16537 year 3
17361 year 4
18232 year 5
Totals 82880 over 5 years which is a 165% return on your $50,000. | |
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| $60,000.00 cash down & still not enough!
Posted: 9/24/2007 3:28:53 PM | Do you want more? Well here's more for the ones that have $60,000.
Forget about buying that $300,000 place here. Go rent it for$1400.00 a month. Much less than the $2000.00 a month it will cost to own this property after the $60,000 down parment. Taxes, strata fees. etc.
Go buy 2-4 good rental property's in Sask. and get good positive cash flow each month in your pocket and watch those property rise over the next few years. By the way they went up 40% in the last year. Places like Saskatoon, Regina, Yorkton, Swift Current, Weyburn, Estevan. Yorkton is a great place. Has 18,000 people and is a hub for that whole area. Has 3 highways that meet there. Wallmat already built. Home depot or Rona is in the works. Canadian tire already built. A plant is currently being built with one more maybe happening next year. What do you think of a plant with 200 jobs in an area like that means? That's like thousands of jobs if a plant was built in Vancouver. Major offset of other jobs in the area as well because of it.
Any more advice will cost you and I can be emailed directly.
Oh by the way I do own a major property in Sask.
My home is not my major asset my revenue property is. That is another tip. | |
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| $60,000.00 cash down & still not enough!
Posted: 9/24/2007 6:00:52 PM | There are other ways to make money off real estate properties other than buying fixer uppers to flip, buying for rental income, or using for grow ops.
I bought some property and used it as a fill dump...the land was pretty much useless for anything but doing this. trucking companies will pay to have a place to dump their fill, and I'm not talking about breaking laws and bringing in contaminated soil either. Blue clay pays up to 150 a truckload, depending on distance of trucking required, and clean fill(gravel/top soil), can pay up to 60 a truckload. at the end of the project, limit the type of fill you need to finish the landscaping and the end result is an attractive peice of useable land. I watched some investors by a peice of bushland and turn the property into a golf course worth millions without paying anything at all. In fact if you buy the right property that is completely undesirable on the market, and if the dump can stay operating for a couple of years, doing this will pay the entire property completely off...Its really not all that difficult to start up, and is only a matter of bringing in a surveyor to put a plan together, and a small application fee at the regional planning office.
If the property has half decent gravel or rock on it, then that could be sold initially(mining permit req), and also will make more room for fill to be brought in....that way you get paid for it going out and coming in. | |
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| $60,000.00 cash down THE CRASH IS COMING!!!
Posted: 9/24/2007 7:20:12 PM | Most people do well buying a home because it inspires them to do something with their money other than blow it paycheque to paycheque which is the normal thing for young people to do. North American young folks normally mature enough to buy a starter home sometime in their 20's, and then make mortgage payments instead of rent payments. Then after a number of years, making all the extra payments they can, they get some equity and trade up.
Funny how we make payments for something over a decade, and suddenly don't have to make payments any more. Most young folks can't imagine living more than 10 years -- but they do... Us older folks can surely imagine living 20 more years, and much more often than young folks .... we don't  This comment may seem to come out of left field, but actually it has a lot to do with rela estate planning.
After paying off the ultimate home (ultimate is when you stop trading up as opposed to an indicator of quality), usually people start making the same sized payments as their mortgage payments into building a nest egg for retirement. The payments could buy any type of investment... some even buy rental real estate properties.
Finally, there is a divorce and the spouse takes half. After the legal fees and support payments, you are left with enough to start out renting again. 
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| $60,000.00 cash down THE CRASH IS COMING!!!
Posted: 9/24/2007 7:58:51 PM | Oh you are so right BTC, I bought a townhouse in Jan after finally getting a settlement after 2.5 years of negotiations. Housing sure went up during that time and as a result so did my settlement. Still not enough to buy a house within reasonable distance of work but I did swing a townhouse. Well it's like a house, I have a large two car garage all to myself and over 1400 sq feet to live in but the real bonus is I don't have to do the yard work and can spend my time at the POF events instead.
Heck my place has increased in value by $20 K just since January. As long as I live here for a number of years I don't think I will lose, seeing nothing but gaining and who doesn't want to do that.
Trick is buy what you can afford and be happy with what you have. Everything afterwards is gravy.
OP I think the young people just have to lower thier expectations a little and look at more realistic places to live in. | |
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| HOUSING FORECAST
Posted: 9/25/2007 6:44:04 AM | I'm doing a report in my economics class on housing prices. According to the banks, economic forecasters, newspapers and everything in between, can anticipate a decline in prices in 2008 but it is forecast that the prices will steadily increase until 2010. The market will slow to a crawl in 2010 because of the Olympics and no one wanting to sell as most likely people will rent space out, then it will increase in price again. However, 2011 everyone will start selling off property again. Expect the decline to begin that year as the market is flooded with housing mid-year and it turns into a buyers market and prices start dropping. Also watch the interest rates. As the interest rates increase, prices will start to slow down as first-time buyers and home-owners downsizing or upsizing will be less inclined to move and get new mortgage.
However, on the building end of things, expect residential building of single family detached homes to decrease and an increase in single unit dwellings (for all you baby boomers turning senior in the next 25 years). Hence, if you are looking for purchase a house..you are looking at big bucks baby. Better to start small with a 2 bedroom and work your way up the property ladder. Don't expect to buy a new house unless you have the collaterate for a $750K mortgage and can afford a mortgage at a minimum rate of 8% to take into account possible interest rate increases.
My advice, get into the market now with whatever you can afford. 4 years ago, on my meager salary, I got a mortgage for $140K with 25% down and purchased a 2 bedroom townhouse in Burnaby that I absolutely HATED! However, 3 years later, I made $60K when I sold my townhouse and downsized to a 2 bedroom apartment in New Westminster on the top floor with sloped ceiling, and fabulous view, that I and everyone falls in love with whenever they enter my apartment. I'm never selling this place! EVER! In 1 year, the property value has increased $30K. I fully intend to use this apartment to springboard to a house eventually (or rent it out and flip the mortgage on the new place to my apartment). The point is..you have to start somewhere. So you live cramed in a place that isn't your dream home when you first start out...who cares! Think of the first property as an investment property and bounce from there.
Sorry, too much economics...I'll shut up now. :) | |
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nrk
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Joined: 3/31/2005
Msg: 37 | |
| $60,000.00 cash down & still not enough!
Posted: 9/25/2007 6:32:06 PM |
I know a young couple both working full time and over time and saved $60,000.00 to put down on a home and still can't qualify for the mortgage
this particular couple ,,the income of the man would only be considered in this case therefore not enough to qualify for the payments ....
Going back to page one ^^...I don't understand why only the man's income would be considered if both of them are working full time.
Have they tried a mortgage broker? I qualified for my first mortgage on my own as a self-employed person with only 5% down. My income was nothing to write home about and I'm sure if I'd gone thru my bank they would have laughed in my face. My interest rate was no higher than what the banks were offering and the only 'extra' expense I incurred was the CMHC fee because it was a high-ratio mortgage (which I would have been hit with thru a bank, too) I think if your friends aren't carrying a big debt load that would disqualify them anywhere, they ought to shop around a little. | |
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| $60,000.00 cash down & still not enough!
Posted: 9/25/2007 10:08:37 PM | They need a morgage Broker to help them and they probably need to set up a second
morgage maybe the house is too expensive for them find one with a suite rent it out as additional income | |
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| $60,000.00 cash down & still not enough!
Posted: 9/25/2007 10:27:44 PM | Ugg, that is just nasty and I believe it is happening.
Houses in Kelowna have nearly tripled in the last 5-6 years.
2002 - new 1650 sq ft townhouse $130,000
2007- same townhouse markets and sells withing days- $355,000
I would not buy now if i didn't own. Thank god I do ---I think the market is close to peaking. I would move somewhere smaller or rent. The problem is rent here is 1000-2000 mos for an average home. Yikes!! Mortgage brokers are also a wealth of info. I know a great one, mail me if you want a referral. | |
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| $60,000.00 cash down & still not enough!
Posted: 9/25/2007 10:54:11 PM | What are you friends looking for to buy? You can move into a pretty nice condo for about $60,000 down. Yah, you're paying alot in mortgage but then, so did I when I bought my first place in the mid-80's, but honestly, it wasn't much more than the rent I was paying either.
How about buying a mobile home? Or not your 'ideal' place in not the 'perfect' location.
A great-aunt and uncle built a place off of 33rd and Knight just after WWII for just over $3,000. They didn't have a car until the mid-60's and raised 4, yes 4, kids in a house with only 700 square feet.
My place is just an old mobile home. I pay my pad rent and the trailer cost me about $14,000 2 years ago. Not the best place I've ever lived but sure beats living next to a very famous pig farm like I did about 15 years ago........... | |
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| $60,000.00 cash down & still not enough!
Posted: 9/28/2007 12:19:16 PM | Nice forum, but alot of you are giving advice to a subject that clearly you have no understanding of.
Simple Economics relate to the price of Real Estate. (or just about anything in a free market)
REALTORS do not set the price of Real Estate- Sellers do.
REALTORS do not set the price that properties sell for - Buyers do.
REALTORS do not Qualify purchasers for what they can afford - Lenders do.
REALTORS work with their clients to help them better understand the market
We actually do not have a shortage of 'land' we have a shortage of 'developed land' (services and infrastructure - roads- bridges, sewage treatment and potable water, Electricity)
We have a declining naturalized population and are Dependant upon migration and immigration to maintain our population. If we do not INCREASE our immigration to augment the coming RAPID decline in our population (bye bye boomers) We will not only have a decline in Real Estate Values we will have a collapse of Everything because of the loss of tax base.
Immigrants tend to be Middle to upper class Citizens
In the Global Market place Vancouver is still Cheap (Generally) for the Lifestyle and Quality of life (this fact will only become clearer when 2 Billion people watch the Olympics and See what all our wining is about)
80% of all the members of the Forbes 500 made their fortunes in Real Estate.
Real Estate Has been always a good investment.
To Qualify for a mortgage there are dozens of Factors. Commenting without knowing more than one figure (down payment) would be foolish for anyone.
Yes I am a REALTOR and Developer | |
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| $60,000.00 cash down & still not enough!
Posted: 9/29/2007 10:38:05 AM | well we may not all be professional but i agree with these quotes...
80% of all the members of the Forbes 500 made their fortunes in Real Estate.
Real Estate Has been always a good investment.
I don't think you have to be a potential member of the Forbes 500 to take advantage of the "accumilation of wealth" ability that real estate has to offer. I believe you can be a small scale guy and build financial independence by buying and holding your principal residence, and then sometime in the future, acquiring a rental property or two.
As a previous poster noted, the payments at first may seem like a burden, but after 5 years...it ain't so bad.  | |
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| $60,000.00 cash down & still not enough!
Posted: 7/7/2008 9:36:34 PM |
Daycare alone is over $1,000 a month!
My daycare rates are cheaper because I am in Chilliwack and not the city and even I pay $1250 a month. | |
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| $60,000.00 cash down & still not enough!
Posted: 7/7/2008 9:48:04 PM | Buying Vs. Renting:
The apartment I am currently renting came up for sale and was listed at $165,000. With a $10,000 downpayment I was still looking at a $910 a month mortgage payment and then $210 strata every month. ($1,120 a MONTH!)
I pay $800 a month in rent. I'm happy renting thanks. If the fridge stops working, or something goes wrong, it's someone elses issue. | |
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| $60,000.00 cash down & still not enough!
Posted: 7/7/2008 9:59:14 PM | ^^^Renting can be very appealing if you think of it in terms of no responsibility. But your money every month is going down the drain so to speak. You are investing in someone elses pocket every month instead of your own and you have nothing to show for it if you move.
I would never own a condo, or at least not yet. I struggle with the idea of paying strata fees and being told how to live my life within my home and around it. I suspect when I get older and no longer have the energy to keep up with my yard work and snow removal I will take a closer look at condo's.
There are many sub lenders out there that will take on a new mortgage for young families that may not have established a credit history or their finances (debt ratio) is not in line but you need to be able to put the 25% down. The problem with them is you pay a higher interest rate and start up costs. But if you use them, only use them for a year to obtain credit. This option would of worked for the original OP example of 60,000 down. Using a Mortgage broker is the only way to go these days. They are there for you and do the leg work and will find the best going deal out there for your individual needs. I have always used one and would never go back to doing my own shopping when my mortgage renewals come up.
CC | |
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| $60,000.00 Beware of mortgage brokers THE CRASH IS COMING!!!
Posted: 7/7/2008 10:18:11 PM | ^^^ late.........
Curious to why you would say that about Mortgage brokers. I have never had to pay to use one, so its of no expense to me and they do the work that I would have to do otherwise. They receive their monies from the banks for doing a service for the bank and I get a good rate....
I would be curious to hear why you would say they are bottom feeders....sub lenders..now they are bottom feeders but in the case example given by the OP..they do provide a service to help those that would other wise not qualify with one of the top 5 lenders. And you only have to suffer for a year to build credit...many kids today do not understand credit rating, how you get a good one and so on. Many people think that if they do not owe anything they would have good credit...wrong...you need to use credit cards, you need to show monthly on time payments and you need to ensure you are not too close to your max to build up a good score. Its a balancing act of sorts to establish a rating over 700...
CC
Mortage brokers are bottom feeders like most in the real estate business | |
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| $60,000.00 Beware of mortgage brokers THE CRASH IS COMING!!!
Posted: 7/7/2008 10:18:52 PM | I just bought a house for ZERO down.
I have immaculate credit.
If they couldn't buy a house with $60k down, then there's a problem with their credit. it's JUST that simple... how many derogatory claims are on one or both of their credit history? How many loans have they defaulted on? Are they self employed? Do they both work for minimum wage?
Answer yes or more than zero on any of those questions and you'll find adversity in the lending field.
Oh, and are they Vietnamese? Vietnamese are racially profiled by many lenders. Why? I'll let you guess. | |
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