A brief history of credit measures

Totoro, I shop almost exclusively at BCL and my drinks are the same price as liquor plus.

Marko, it’s not a lack of construction unions keeping housing here at its bargain basement pricing.

Back to housing. The over two million mark properties seem to still be moving briskly and frankly I am surprised at some of the houses that have sold in this price grade. I am beginning to suspect that this is not a bubble but rather the new norm.

Even at these prices there is little to choose from on the market.

It’s nice to see that one of our local Starbucks has unionized. Hope more workers follow suit.

So you wouldn’t be complaining if the homes you are looking at went up another 100k as all construction workers unionized and measures such as rain/snow/too hot days were introduced to improve working conditions of construction workers?

Private liquor store workers deserve good pay, benefits and a retirement too- It’s not a race to the bottom. Instead of attacking someone else’s pension (that they pay for out of their government salary I might add, heavily) why not look inwards as to why you’re not getting the same? It’s nice to see that one of our local Starbucks has unionized. Hope more workers follow suit.

https://financialpost.com/pmn/press-releases-pmn/business-wire-news-releases-pmn/victoria-starbucks-workers-brew-up-first-contract

Anyone know the reason(s) why a group of 5 houses on large lots are all for sale at W. Saanich and Mctavish? I believe one has sold. Cheers.

Also I hope Introvert bought the stock he/she was eyeing up. It has had a nice up tick since. Congrats if so.

The BC Public Service has less than 40000 people, so that can’t be what he’s talking about. In fact, I can’t find anything on the BC labour market suggesting that the number of “public service employees” has jumped 210000 in 4 years. Probably a short-term boost in health care workers, but I’d argue I’ve seen a service increase there over the past year or so. How do people fall for this BS?

Link to stats: https://www2.gov.bc.ca/gov/content/data/statistics/employment-labour/labour-market-statistics

Anyway Cynic, I am glad for many whom work in government positions and get good pay and great perks and benefits. But middle income taxpayers, government employees included, should not be obligated to subsidize families making over $110K per year in order for them to purchase a home. There are just too many other groups that need financial support over them.

Also, when comparing private vs public sector employment, I don’t think most of us, at least not me, think employees working in the professional fields such as Medical, Engineering, Scientific and like categories of the government have it particularly better than they would privately.

It is the rest of the groups such as in administration /administrative support, general labourers, etc. that are top heavy and over compensated in comparison with their privately paid counterparts.

And yes, I think the person behind the till at Walmart does have a more difficult job than the one at the municipal hall re-directing phone calls does.
And no, I never worked at Walmart.

Okay, lets compare the government liquor store employee (selling only liquor) & the private liquor store employee selling liquor, chips n cheezies, baseball caps, pop……….who works harder there? Who has the better education?

“This happens in provinces that the NDP come to power in. They’ve never won a federal election and so they have such a large political machine to feed, they can only do it by moving their allies all over the country wherever people are foolish enough to vote them in.”

Bullshit. Governments of all stripes do this. Remember when the Christy Clark Liberals hired a bunch of ex-Harper government staffers to get the message out?

“the number of public service workers has increased from 290,000 to 500,000.”

Lol, and you know what the source is? Liberal MLA Mike Morris! Who the hell is that guy anyway? Never heard of him.

Here’s a crazy thought though…supposin’ that those numbers are actually true: Do ya think that maybe, just maybe, it might have something to do with that whole COVID-19 thinger?

Here, here Up and Coming and Stroller re “paid for by the rest of us pensions”.

As Marko said, his basic salary was hugely increased because of all the overtime, shift differentials etc.

Usually pensions are calculated at 2% of your average salary (over your best 3 consecutive years?), times the number of years service.

So, if your “basic” annual pay was $54K per year, your pension would be after 30yrs service $32,400. But if you were to actually make $70K per year because of weekend pay, shift premiums, stat pay and acting pay , your pension would be $42K per year. Usually, overtime, which can really boost your income even more, is not included in pension calculations.

So when you look up what these public service employees are making, you can usually add several thousand on to that because of all the above mentioned. For a real laugh, calculate how many days they actually work per week (or year) considering 4-5-6 weeks annual leave, sick leave, special and family related leave, 12 Stats plus their 2 hour “doctor appointments” a month. I probably missed a few. Annually paid Federal gov’t employees have a 37.5 work week, but I believe the Provincial employees work a 35 hr work week……so they get the “flex Friday” every single Friday. Nice.

I wonder how many people working at Walmart get shift & weekend premiums. Maybe they do, I don’t know.

“Sounds like a horrible idea imo.”

Sounds like another realtor giving financial advice. You’re going to make Mr. Buddy be a bit taken aback again

As yet unconsidered factors in the Victoria SFH price runaway…..

Buried away in a newspaper article about the heat wave is a little note about the reign of the NDP here in BC. In the four years since the kleptocracy came to power the number of public service workers has increased from 290,000 to 500,000.

After you’ve had a little time to quell your nausea, imagine that you yourself were amongst those chosen few. You would have an above average salary which ramped up regularly without any need to increase your performance, be held to no known standards of work productivity or probity, could not lose your job under any circumstance of personal underperformance or economic downturn, and be looking forward to an extravagant pension guaranteed to be funded by your fellow citizens regardless of the future state of the province’s ravaged finances. Would you not think a large mortgage was a triviality?

So….. a 70% increase in the number of people “working” for the rest us out here in the real world. Would anyone like to post examples of the 70% increase in services they have received over the last 48 months?

Any one know why 1229 St. Patrick St sold for well below ask after 42 days on the market? Looks like a decent character home in south Oak Bay.
Listed 1.65
Sold 1.42

Marko, here is a current posting for respiratory therapist at VIHA where the hourly rate range is $30.82 – $38.56 depending on experience (since its a union job). So assuming a 37.5 hour work week you would just crack 75k at the very top end, for anyone not at the top end you would need overtime to crack 75k a year. I don’t know what the exact hourly rate was 15 years ago but obviously it would have been a lot lower.

Nightshift differential, weekend differential, pager pay ($30/shift), student preceptor pay ($24/shift), overtime, stats, etc. I think I started at $25.80 so it wasn’t a lot lower 14 year ago. It wasn’t difficult to clear 75k. I worked overtime Christmas/Boxing day two years in a row as most older RTs wanted to be home with their kids.

You could also go to Alberta and the lower and top end increase by $8 and houses are a lot more affordable to boot.

Beyond that, you needed to have a pretty high taxable income to have a marginal rate of 50%. Over $60K, which in today’s terms is about $135K.

FYI, the 53% highest tax rate kicked in at $25,000 income in the early 1980s (under Trudeau and the Libs), up to 1986. It got lowered in 1987. (Thank you Brian Mulroney and the PCs). The PCs got rid of the $1,000 interest exemption in 1987, but phased in $100,000 lifetime cap gains exemption, which was better. In those days we didn’t ask the government to increase taxes, like goes on here.
Page 1062 https://www.fcf-ctf.ca/ctfweb/Documents/PDF/1995ctj/1995CTJ5_02_Smith.pdf

“But they didn’t really. Owning your own house was part of the normal working/middle class lifestyle. People didn’t have to give anything up.”

I don’t think that’s true. I grew up in a middle-middle class household in the 90s, and we lived modestly in order to live our Suburban Lifestyle Dream. No fancy cars, we never got on a plane to go anywhere, had dinner out once every couple weeks, etc. There were definitely sacrifices made.

FYI, Savings interest was taxed over 50% in the 80s and didn’t keep up with inflation after taxes.

FYI, until 1988 the first $1000 of interest income was tax free. Beyond that, you needed to have a pretty high taxable income to have a marginal rate of 50%. Over $60K, which in today’s terms is about $135K.

One more thing – there was also something called a Registered Home Ownership Savings Plan. Worked very much like a TFSA – no taxation charged on interest earned or withdrawls provided you used it for a DP.

People in the past worked hard and sacrificed to buy a home.

But they didn’t really. Owning your own house was part of the normal working/middle class lifestyle. People didn’t have to give anything up.

Obviously there were exceptions like newly arrived immigrants or refugees, or someone buying a house on one income after two incomes had become the norm.

Some friends (early 40s) just told me they are buying a new build condo- as a way of building equity. Idea is to buy it and then flip it in 3-4 years to make equity.

Sounds like a horrible idea imo.

When I invested in real estate, the sellers didn’t give a damn where the money was coming from. When I’ve sold properties, I didn’t give a damn where the money was coming from. If you want to live in a state controlled society move to Venezuela, let me know how that works out for you.

buying a new build condo- as a way of building equity… isn’t this basically the same as using a line of credit to buy stocks?

Yes and no.

At the moment rent doesn’t cover mortgage/maintenance/strata/taxes so the condo owner is betting on the market keep going up at a rate that is greater than the monthly lost and inflation, hence it is more liking using HELOC to buy Options.

It is quite prudent to use HELOC to buy stocks because the current interest rate is 3%, and there are many dividend stocks yield well above 4% therefore the risk is lower.

they are essentially taking investment advice from their realtor

Are they buying from the realtor listing as well so that he/she can cash in on the double ended deal?

Would it be okay on here if a private investor (wanting to make a pension for himself on retirement as not fortunate enough to be able to pay into DPP), bought an “affordable” investment property after it sat for 30 days on the market without a reasonable offer?

Strata duplex right in town. B-2511 Vancouver St. Sold: $650K Originally asking $699K. On market for at least 30 days. (So time for inspection)
VERY flexible floor plan with options depending on how big your family is and what you are willing to do to own.

Total of 1500 Sq ft, 3 bedroom, 2 full baths, one main bright kitchen plus kitchenette down. Main living room with F/P, dining room. Separate Garage. Lots of storage in attic.
Easy care vinyl siding. Updated windows and gas furnace in last 15 years. New flooring. Street has sidewalks and boulevards.

We can’t mistake that as the younger generations are too soft, not making enough sacrifices, etc. If houses originally were a 3x multiple from an average income and now they are 7x, in real dollars, then objectively they are less affordable now. Period.

No. They are actually more affordable now at 7X income than they were back then at 3X income. That’s why affordability isn’t measured as price/income, it’s mortgage payment/income

Last time houses were selling at 3X income, was the 1980-1992 period. And mortgage rates were around 11%. (some years were much higher)
You can see from this mortgage calculator https://tools.td.com/mortgage-payment-calculator/ that you pay more per month paying off a $300K mortgage @11% than $700k @ 1.68% (current 5yr term/25 amort discount mortgage rate and other rates from https://www.ratehub.ca/5-year-fixed-mortgage-rate-history

$700k @ 1.68% = $2,857 per month
$300k @ 11% = $2,887 per month. <- ——— they would pay more back then because of huge interest payments

These days, 79% of all mortgage payments you make over a 25 year period (if rates stay the same) are forced savings (equity). only 21% of your mortgage payment is down the drain (interest). Lots of people realize it, and that’s why there are so many buyers now.

That factor is also almost always ignored when comparing real estate costs/affordability between Canada and European countries.

If houses originally were a 3x multiple from an average income and now they are 7x, in real dollars, then objectively they are less affordable now. Period.

I agree with most of what you said except this. lets assume average income is 100k – is it more affordable to buy a home at 400k at 10% interest (payments on 25 year are $3578) or a home at 500K when rates are 5% (payments are $2908). The latter your income to price ratio is 5 to 1 as oppose to 4 to 1 but the payment is $600+ a month cheaper. I think a lot of people would say the latter is more affordable.

I think I understand where Marko is coming from, because I know the type of person he’s describing from my late 20s/early 30s social circle. I know one who complains about not being able to afford property while also spending $1000+/month on food delivery, another that complains while having never worked a full-time job (by choice), and yet another that has been complaining prices are too high for the house they “deserve” for the last 7 years despite having the money to buy something the whole time. Everyone else bought a townhome/half-duplex/SFH within the past 3-4 years either here or in the lower mainland.

Still, that doesn’t mean that more and more people who work hard, save their money, etc. etc. won’t be pushed out every year as affordability continues to decline and the bar for entry increases. I don’t know that the path to real estate that most my age took will still be available to those currently in their early 20s.

More generically, this is a problem that comes up with any type of social policy. Either you help more people (and some people who probably don’t deserve help get a benefit), or you help less people (and some people who probably do deserve help get left out).

The lesson people learn today is that borrowing money gets you ahead, not saving it.

You still gotta have good income to borrow 1M. Ur not getting that mortgage working a union job at government with flexdays.

Nothing wrong with this Marko, its ok to want nice things but at the end of the day one needs to have the means to acquire them and achieving the means to acquire them is up to the individual.

There is nothing wrong with nice things; I drive a $100k car. The problem I see is people execute the sequence poorly. When I was 21 yrs old making $75k @ VIHA I lived with my parents (in 800 sq/ft), had a Telus pre-paid cellphone and I clearly remember the $25 pre-paid card expired every 60 days, used car, etc. Anything I didn’t spend on tuition in an attempt to improve my workplace situation I invested. I still own shares of BMO I purchased in 2009 @ $32/share.

Once I had a property, investment properties, maxed out RRSPs/TSFAs, then I started spending on nice things.

If I didn’t have a property and owning was of important for me I would be working multiple jobs and spending nothing to get into something.

Refugees that come to Toronto with absolutely just the shirt only their backs somehow have higher rate of homeownership than Canadian born if family income level is equal that of Canadian born.

This makes sense to me. People in Canada saw their parents spend money and still afford housing and had nice things. Now, even though they know that homes are much more expensive , they spend money and it’s a hard habit to break.

My friend almost married a woman from mainland China and her family grew up incredibly poor (the dad died when they were kids). The mother came to visit when they were living in vancouver. The mother was as cheap as they come. When they went to the mall she would go to the bathroom and steal the TP – only the rolls are locked so she would unravel the whole thing, put it in her purse, and then roll it back on to a roll at home. She once scolded my friend for opening the door of the fridge too long and wasting energy. One time he came back from a grocery store with name brand bacon and his almost-wife told him to go return it for no name. It impacted every aspect of his life – but he saved more money then ever with her before they broke up. Refugees come here with nothing and so having nothing for years while they save isn’t as difficult from their perspective.

Not stating that all, or even many, refugees would.live like this but that mentality of having nothing and taking whatever you can is less common as we have social nets with minimum guarantees etc.

You can’t solve a housing shortage through redistribution.

Leo,
Bravo!
That perfectly sums up the housing shortage.
It’s gotta go on the HHV coffee cups and t-shirts!

Every investor who buys a SFH and rents it out is outbidding a renting family who wants to own their own home. They are not increasing the net rental supply.

That’s nonsense. Maybe true in theory, with flawed assumptions ignoring elasticity, but not in the real world. Victoria is not a closed system.

Rather than me explain it to you, how about you explain it to the class.

There was no camping, no skiing, no pets, no trips/vacations/grandparent funerals back to Croatia, $1,400 1981 diesel Vovlo, used TV, etc., until a house was purchased (before 2000 apparently).

I saved close to 50% of my take home pay every month before I bought my first SFH in Vancouver. The point, Marko, is that making this kind of sacrifice doesn’t work any more. The lesson people learn today is that borrowing money gets you ahead, not saving it.

3366 Shelbourne just sold for $600K

Alexandra, maybe it was something you said 🙂 . Let’s hope someone here bought it…. or buys the twin (3364)

What I see my in personal day to day business is newer cars, people skipping town every other weekend for various activities, pets, flex Fridays, and big expectations for a 1st home. A lot my first-time buyers want an ensuite, that is just insane imo.

Nothing wrong with this Marko, its ok to want nice things but at the end of the day one needs to have the means to acquire them and achieving the means to acquire them is up to the individual. For all you clients that want those things Marko, please show them the below job postings currently at BCI (both come with DB pensions):

https://careers.bci.ca/res_viewjob.html?optlink-view=view-7728&ERFormID=res_newjoblist&ERFormCode=any
~200k/yr after bonus

https://careers.bci.ca/res_viewjob.html?optlink-view=view-7766&ERFormID=res_newjoblist&ERFormCode=any
~300k/yr after bonus

Right now there is a strata titled duplex on Shelbourne having both sides for sale. They have been reduced in price and been on the market I believe for more than one month. (says 11 days but that is after relisting) Asking price: $619K for each side. They are bright units with three beds, 2 baths, den or playroom area and private fenced back yards.

Caddy,
What’s wrong with this place on Shelbourne (Saanich)?
You could buy it and tell your landlord to take his rental unit and shove it up his assets.

—-====================

https://www.rew.ca/properties/3423111/3364-shelbourne-street-saanich-bc#

3364 Shelbourne Street
3 Bed, 2 Bath, 1217 Sqft, Duplex

List Price, $619,900
Gross Taxes for 2020 $2,364
Strata Maintenance Fees $0

“This 3 bed 2 bath ½ duplex checks off all of the boxes, a private yard for the kids or dogs to play in, space for the family, storage, NO strata fees, & separate legal titles. This home offers a perfect layout w/ open kitchen & dining on main, 2 pce bath, storage, generously sized & well-lit living room + den. Hardwood flooring spans much of the home plus thermal windows & forced air high efficiency furnace. Upstairs you will find 3 bedrooms w/ closet space & 4 pce bath w/ full tub. The balcony is accessible off the kitchen w/ outright privacy leading down to the fully fenced back yard. The location is in highly sought out East Saanich minutes from Gordon Head Rec”

Marko may seem non sympathetic and hardened but he is right. My parents were able to purchase a home in Fairfield years ago. They both worked. Mom at slightly over the minimum wage (and it was a tough labor intensive job) and my Dad at a lower than middle income wage. In order to make ends meet, they rented the upstairs. The main floor had one bedroom which my brother and I shared with a curtain down the middle. My parents slept in the living room on a sofa bed. We all shared one closet for clothes plus some hooks for coats hanging by the basement door. We had one small bathroom. It was a nice house inside though and it had a lovely back yard that we shared with our wonderful family dog. We were a very happy family and felt blessed that we could live in such a “beautiful” home. People just didn’t need as much back then. Children were much more self reliant. On my Dads day off he would often help write letters and read and assist in filling out forms for new immigrants that didn’t know the language well enough to read and write in English. On Sundays, because they were both excellent cooks/bakers, they would tend the back garden often canning preserves.

Right now there is a strata titled duplex on Shelbourne having both sides for sale. They have been reduced in price and been on the market I believe for more than one month. (says 11 days but that is after relisting) Asking price: $619K for each side. They are bright units with three beds, 2 baths, den or playroom area and private fenced back yards. Lots of parking but no garage. I realize Shelbourne street isn’t the best. But houses, townhomes & condo’s on the same street certainly get a fair enough price. Good chance same person owns both sides on this one. No takers yet. At one time, because of all the similar duplexes in a row, I would have been thinking of possibilities for the future. Too old now though.

Because of what we do know from the data collected is that foreign buyers make up a very small part of the market in Victoria and, to quote Leo, “they have no appreciable effect on the market in Victoria”. https://househuntvictoria.ca/2016/10/29/foreign-buyers-tax-has-no-appreciable-effect-on-victoria”

How is that relevant when talking about BC prices?
From that article: “the foreign buyer tax was blunt but incredibly effective. The percentage of foreign buyers in Vancouver is down some 90% from before the tax. ”

So while the change in Victoria was from 3.90% to 3.30% ( a 15% drop) during the given timeframe, the impact on Vancouver was much higher. Just FYI, something doesn’t need to directly impact Victoria for us to be impacted. Vancouver buyers have a big impact on Victoria – especially when prices go up. So just saying this didn’t impact Victoria all that much therefore it had no effect is an incorrect assumption. Again from Leo’s article “A return to more local fundamentals in Vancouver, and a possible stemming of the overflow into Victoria.” So still not sure how you are asserting these items are having no impact on affordability.

My problem is people your age just assuming that people aren’t willing to sacrifice and we just want our avocado toast and homes in the core and don’t recognize that the problem is much larger than that.

When my parents came to Canada in the 1990s, we lived in a crappy suite on Roseberry. Both parents worked 6 days a week and on Sundays we delivered fliers for the first two years in Canada. There was no camping, no skiing, no pets, no trips/vacations/grandparent funerals back to Croatia, $1,400 1981 diesel Vovlo, used TV, etc., until a house was purchased. House my parents ended up buying was all original, 801 sq/ft upper floor, 2 bed/1bath. First thing they did was put a two-bed suite in the basement in 15 years later once they paid off their house, they renovated the upstairs.

What I see my in personal day to day business is newer cars, people skipping town every other weekend for various activities, pets, flex Fridays, and big expectations for a 1st home. A lot my first-time buyers want an ensuite, that is just insane imo. I lived with my parents until 25 yrs old with one bathroom never an issue. 2,000 sq/ft for a family of four is kind of a high expectation. No reason 1,200 sq/ft can’t work.

We have a housing problem and prices are insane, but what people define as sacrifice today is kind of a joke imo.

Sounds good in theory alexandracdn but we, two university students at the time who had just spent a few bucks moving, were told if we didn’t like it “leave”. Underpaying the rent and the subsequent fight through RTB was considered but also low on the scale of good use of our time and energy. Left right after graduation.

For the “just build more supply” argument, that’s just more supply for landlords hey? I know more and more people buying a new home to live in and just keeping their first home as a rental. You only need 20% down on the the investment property, or 20% as equity in the first house and 5% down on the next one if you move in. IMO that’s why we need to address the demand side more and nail 2nd, 3rd 4th+ properties with heavy taxation, higher downpayments etc. Hording shelter for ever increasing profit is exploitative.

I’m super grateful to my last landlord …. This is not desperately needed, stable rental accommodation, it’s “entrepreneurs” making the best of their own little world until it no longer suits them to provide a home to a tenant.

I’m not saying you should be grateful for what your landlord does. I am saying that without private landlords the vacancy rate would be even worse and when you were evicted for landlord use of property you would have had an even harder time finding a place. If there were more purpose built rentals at least this situation could be eased.

Where is your data on this? because prices are higher? How do you know prices wouldn’t be even higher if we didn’t implement those controls?

Because of what we do know from the data collected is that foreign buyers make up a very small part of the market in Victoria and, to quote Leo, “they have no appreciable effect on the market in Victoria”. https://househuntvictoria.ca/2016/10/29/foreign-buyers-tax-has-no-appreciable-effect-on-victoria/

And, in terms of the speculation tax, also to quote Leo, “Overall, I think we can conclude that the spec tax is a minor adjustment as far as the market is concerned… the return seems to be relatively low for the administrative and collective effort required to keep it going.
https://househuntvictoria.ca/2019/07/19/spec-tax-little-sign-of-impact-on-victoria-market/

Leo’s views may have changed since, but the data he posted appears reliable.

I guess you are making unfounded assertions you can’t back up and becoming one of those things you despise so much.

Guessing instead of asking when it is easy to do is a problem.

none of the steps taken to date in BC have resulted in improved affordability.

Where is your data on this? because prices are higher? How do you know prices wouldn’t be even higher if we didn’t implement those controls? You can not say things are not more affordable as we don’t have the data showing where BC would be if these controls had not been implemented. I guess you are making unfounded assertions you can’t back up and becoming one of those things you despise so much.

Rush4Life, aren’t you a current renter, and where would you be living today but for the foresight and enterprise of your landlord, who has provided you “shelter” when you needed it?

I live in an apartment – not a home that could have been purchased by someone – a purpose built rental which I agree we need a lot more of.

And when you do buy your house, I would hope that you will return the favour, by renting out a room/suite in the house to someone in need of shelter. Are you planning to do that?

Depends if I get a TH or a house but if i get the latter then yes. And i’ll move out of my rental, free it up for someone to rent at double the price I pay now.

purpose built… I would support a tax on capital gains from the sale of primary residences for this purposes

I disagree. What would stop the government from squandered it away like the rest of the taxes? Just look at the property transfer tax that went straight into general revenue instead of into housing as it was originally sold to the public.

IMO, we must hold the government accountable for their actions or inaction and make sure that they balance the budget, because government can’t keep on running a deficit that will surely destroy our future.

This idea that investors are doing the lords work is really a stretch. Overpaying for a house, jacking up rents, and forcing people to pay inflated prices just because vacancy rates are low isn’t a benefit to society like you all seem to think

Rush4Life, aren’t you a current renter, and where would you be living today but for the foresight and enterprise of your landlord, who has provided you “shelter” when you needed it?
And your landlord will provide shelter for someone else when you move on to better things. Since your posts here have emphasized the importance of this “shelter” to you, it would seem to me that you should be somewhat grateful to the landlord that provides it for you, at least to acknowledge that they are a “benefit to society.”
And when you do buy your house, I would hope that you will return the favour, by renting out a room/suite in the house to someone in need of shelter. Are you planning to do that?

A renter who becomes an owner-occupier is not affecting the supply/demand balance of the rental market.

Everyone buying a home (to occupy) in Victoria isn’t a Victoria renter. The non-renters that buy to occupy do lower the supply/demand balance of the rental market, and it’s good that they are balanced by investors buying to rent. That enables us to maintain balance in the supply of rental housing. Especially SFH rentals, which aren’t supplied by purpose built rentals, and only exist because of mom n pop landlords.

I should have clarified i like the NZ – higher down payment method over taxation. I realize there is a supply issue as well clearly. I’d say attacking from both a supply and demand angle will yield the best results.

to allow househunters like you to acquire and occupy the homes instead of tenants. Your motivation being self-interest

Oh yeah – unlike the bulls who clearly care about the betterment of society. Yes Patrick it does benefit me – you know who else that would benefit? every single person who is born and lives here or moves here and needs to buy a house in the future (who isn’t inheriting one). That is the cost of today’s problems which homeowners dont’ seem to care about. “We got ours and don’t care if every person who comes next has to pay for it – as long as I got mine i’m happy”. At least my self-interest benefits future generations. God forbid someone’s 1.5M home that they paid 500K for drop to 1.3million. Whatever will they do!

‘but we have a severe shortage of rental housing as well and they add to supply and the renter could just as well be angry at you for buying up their supply – because the issue is there is not enough of either type of housing.’

Totoro, if Caddy buys a house then the place he is currently renting comes on the market – so no its not him taking a home out of the market, why would the renter care? This idea that investors are doing the lords work is really a stretch. Overpaying for a house, jacking up rents, and forcing people to pay inflated prices just because vacancy rates are low isn’t a benefit to society like you all seem to think (again circling back to the supply issue which I think is number 1 issue).

Can someone explain to me how this is a good thing vs. my family just being able to buy these houses without firece competition from landlords?

The fact that you are impacted by this makes you angry at the competing buyer who is renting the home out, but we have a severe shortage of rental housing as well and they add to supply and the renter could just as well be angry at you for buying up their supply – because the issue is there is not enough of either type of housing. You have to acknowledge based on past performance that it is almost certain that current “hot” market conditions will not last forever, even if this does not mean prices drop. People buying a house and renting it out are making rational choices in the market, not evil ones, and it has a net positive effect for renters.

Overall I’d say this situation is not good for buyers or renters, but it is not caused by “investors” and the market will cool. I don’t think we’ll see housing security and affordability addressed effectively until we deal with ramping up purpose-built rental supply and perhaps the missing middle housing as Leo has pointed out.

The difference is that if you make it less attractive for investors to buy houses and condos, prices will be lower.

We have a supply issue. There is a shortage of rental housing. If someone is buying and renting out a home they are adding to supply and this is needed. I’d say the only effective measure there to make it less attractive and possibly lead to lower appreciation rates would be a huge influx of purpose built rentals along with affordable housing measures.

Rather than such insecure rentals we should be encouraging investors to put their money into purpose built rentals , which is what we really need.

I don’t see how investors can be encouraged to do this. The price of land plus building is too high here to result in affordable rentals. Purpose built rentals should be run and funded by government/housing societies, perhaps on public lands, and not private investors imo.

patriotz- There already are thousands of real estate investment opportunities for people to put their money into such as REITS. Every apartment building, hotel, commercial property development looks for investors offering them a potential return on their investment. I wouldn’t touch them with a 10 foot 2×4. My insurance broker invested in a hotel in Saskatchewan that catered to oil field workers, it was costing him more money to maintain with no return. He also invested in a seniors residence that was working well for him at the time. Covid has probably changed that and he may be kicking himself for that brilliant investment. I know he put $300,000 into the hotel, if he would have used that as a downpayment for a house in Victoria several years ago, he’d be laughing. These types of investments are black holes and you have no control of what is going on. The other advantage of buying a rental property is that it can be insured for replacement, in case of most disasters. You can’t do that with any investments I’m aware of.

I’ve just watched a dozen houses I otherwise would have bought near list price get bid up to the moon this year by investors who then put them up for rent on Facebook marketplace using the exact same photos as the for sale listing at incredibly high rent prices. Perhaps requiring 40% downpayments would have curbed a few from being snapped up as cash cows and my family could have bought one to live in, freeing up our own rental house for another renter family. Can someone explain to me how this is a good thing vs. my family just being able to buy these houses without firece competition from landlords?

Investors are just the middleman on housing I still need to live in… It’d be nice to have housing treated as housing 1st and investment 2nd with policy like new Zealand’s new higher downpayment requirements on secondary properties.

personally i like increased down payment requirement on investment properties

Ah yes. The latest invisible bogeyman – investment properties.

Perhaps you could explain what the benefit of “increased down payment requirement on investment properties” would be, other than to reduce the supply of much needed rental properties, to allow househunters like you to acquire and occupy the homes instead of tenants.
Your motivation being self-interest – the hope that it might get you a lower buy-in price for a house, but where are the renters supposed to go when they can’t find rentals due to the disincentives to owning rental properties that you’re advocating?

Thanks Pam,

I appreciate what you saying but i still disagree. To start your daughter isn’t the only person who has made big sacrifices in order to get into the housing market. But when prices are rising faster than your sacrifices add to – it doesn’t always help.

Can i ask at what point would you think we should something about this? it used to be people from Vancouver would just tell people to move – ‘move to Victoria’ Vancouver was the only ‘expensive’ place. Then it came to Victoria – people were told to just move up island – Nanaimo/Comox was still cheap. Now we are literally telling people move out of Ontario and BC – and they are, and guess what – those places are going up too. Places in Atlantic are up over 30% in places in the last year. Prices are projected to rise in AB as well so basically are you wanting to wait until anyone who can’t afford a home is relegated to northern Manitoba before you are willing to accept there is a problem? Why not fix things now before it becomes even more of an issue?

My problem is people your age just assuming that people aren’t willing to sacrifice and we just want our avocado toast and homes in the core and don’t recognize that the problem is much larger than that.

what I’m reading from posters here are only suggestions that someone else should fix the affordability issues: make home owners rent out their spare rooms to address rental concerns; remove property tax grants; make home owners pay capital gains tax etc etc. I just have trouble with that;

I see you have trouble with this but i’m sure you took no issues with the ever dropping interest rates the government implemented, or CMHC, or the property tax grant, or the munis who shut down builds likes its going out of style – you had no problem with those interventions or any number of government choices that led to this price gain. Now that people are asking to give some of it back via relaxed building requirements, or taxation (personally i like increased down payment requirement on investment properties) you are feeling like they are trying to take something form you without recognizing how much the government have already given you. Seems a bit hypocritical no?

And congrats to your daughter – i hope she does move back – we can use some more doctors.

Whew, we will never have to live through this again!

Right. And enviro Canada reports that yesterday Victoria hit an official record hottest temp ever.
37.4 degrees at the airport. And we may break it today.
Of course not near the 46.1 degrees all time record for Canada set in Lytten BC yesterday.

“Thank you for completing the Greener Homes registration process!

Once our program officers have reviewed your application for registration and if you are deemed eligible, an energy advisor who works for a service organization will contact you to schedule a pre-retrofit EnerGuide evaluation.”

Does anybody know how long it takes for them to normally contact you?

interior blinds do almost nothing to block heat gain.

We have two sets of curtains, the innermost is lined and insulated – seems like online studies show a 33% reduction in solar gain with this set up. They also help a lot to keep heat in in the winter.

My two cents but closing all the windows and curtains at 6am and not opening them until after 8pm has kept it a bit cooler in our house which has no AC on the main living areas.

This is normally the right thing to do. Even better is to shade your windows on the outside – interior blinds do almost nothing to block heat gain.

https://www.cbsnews.com/news/heat-wave-dome-2021-seattle-portland-weather/

“Pacific Northwest bakes under once-in-a-millennium heat dome.

The heat wave baking the U.S. Pacific Northwest and British Columbia, Canada, is of an intensity never recorded by modern humans. By one measure it is more rare than a once in a 1,000 year event — which means that if you could live in this particular spot for 1,000 years, you’d likely only experience a heat dome like this once, if ever.

Portland, Oregon, has already broken its all-time record hottest temperature at 108 degrees on Saturday and the peak of the heat wave has not even been reached yet. Canada is expected to register the nation’s all-time highest temperature before the event is done. These are extremely dangerous numbers, especially in a region not used to heat like this, where many people do not have air conditioning.”

Thanks late30 – the ‘broker’ i reached out to is specific to one bank. The one i used to work for (big 5). I’m sure every bank is slightly different. That being said for insured mortgages it makes no difference as the insurer needs to sign off on it. This method lines up with what CMHC etc would approve. I used to do mortgages and had ones that were tight with the bank that i put through and were rejected by CMHC.

That being said, and has been noted in the past on this forum, there is some discretion on uninsured mortgages – and with the new B20 some of the banks are adjusting other ratios (TDSR/GDSR) in order to circumvent the B20. I saw an interview with ‘Ron the mortgage guy’ who said there was a percent (can’t remember exacly maybe 10-20%?) of mortgage approvals that the banks could ‘push through’ if they were ‘strong borrowers’ (larger down payments, good credit etc,). And you get into the world of private lenders etc and its a totally different game.

So yes, its not cut and dry but its a good starting point as any.

I thank Thumps for resuscitating this crucial heat pump thread!

My 21k quote is from Red Blue. Which, BTW, was before any grant program was announced.

I also tried to get a quote from Island Energy. They had come out to the house to see what was causing our insane energy spikes during the winter season. The tech suggested the heat pump approach, talked with me about alternatives, checked his whatever & said they had actually quoted a heat pump on the house a year or so ago (prior owner) and that he’d get that updated for me. Called them back about a month later to be told, sorry not available yet and oh the guy who does it isn’t always very responsive. So that was now about 3 months ago. I’m sure as heck not going to chase people like that.

So, I guess I will also get a quote from Coastal.

I realize all trades are super busy, though. Frustrating for everyone.

the thought that people should just pick up and leave the province and will somehow be able to return and own a home hasn’t been the case in the last while.

Good point. Maybe that’s behind the lower numbers of listings. Homeowners may be more reluctant to sell than usual. So they hang on, maybe by staying put or renting out their home while they’re away, instead of selling.

We have central furnace too but the thermostat is upstairs and no amount of tuning with vents will get the temperature to equalize so in the winter the baseboards in the bottom are on nearly constantly.

Perhaps, add a stand alone 1 ton unit to the bottom will solve to problem.

My brother put a single head unit in to his large rancher a couple years back. It heats & cools the majority of his living space for $4500 installed.

Prices also depends on brand, efficiency rating, tons, and accessibility of work site.

but in our case, looks like price tag before rebate is about 20k.

Get 2 more quotes and take the middle price.

Damn! Remind me never to start or play the HHV heat wave heat pump drinking game ever again!

That way lies literal madness! I will stick to the old standbys next time.

Problems solved- without blaming it on anyone else or asking others to pave her way. Pretty sure she’ll be able to afford a house in Vic, eventually.

Thats great Pam – but no one on this forum has ever stated they are entitled to own a ‘house’ or a ‘house in the core’. As for your daughter if she would have bought this place in Edmonton 5 years ago or 10 years ago guess what? her house would be worth the same today or less as prices peaked in Edmonton in 2008 according to the teranet index. Meanwhile her home in Victoria would be 50-100% more valuable. So had you have given her this advice in the last decade she would actually be further away to buying a ‘house’ in Victoria and likely never own here – the better advice would have been to tell her to buy a TH or condo here. If she becomes a doctor then she will be able to own a home in Victoria based on her wage and not her great idea to move to Edmonton. If she doesn’t get through med school and stays an RN and we see prices raise with inflation over the next 10 years in both cities then she will never own a house here (without a spouse earning more money or a windfall). her best hope is oil prices boom, AB prices run and BC stagnates. BUt again that would be lucky timing as that would have not worked out the last decade or more.

My husband and I must be old school- seems to us that no one is ‘entitled’ to own a house, especially if you’re expecting others to make it possible for you ( eg, increase taxes on others who have nothing whatsoever to do with you). In 2016, our adult daughter lamented that as an LPN, she’d never be able to afford to own a house in Vic. Rather than tell her how sorry we were because she is somehow entitled to that privilege, we suggested she improve her station in life if her focus was to own a house. To her credit, she applied to take her 4 year RN, and graduated June, 2020 as a single mom. She moved to Edmonton, worked for a year and also applied and was accepted to med school, which she starts in late August. In addition, she just bought a house for $399,000 ,and rents out the basement suite which more than make her payments. Problems solved- without blaming it on anyone else or asking others to pave her way. Pretty sure she’ll be able to afford a house in Vic, eventually.

don’t know how to quote (duh…)

but in our case, looks like price tag before rebate is about 20k. Rebate should be 5k, but will have to wait & see what the energuide assessment says about all that.

is it worth it? hard to say. I was getting insane bills in winter, and we plan to live in this (new to us) house for a long time, so probably yes.

I also need to make sure the heat pump concept can actually handle what’s needed. The heat pump would need to service about 2400 square feet on one level, and it would be an air-to-water system to hook up to hydronic radiant heat (I think better versions of such air-to-water systems have only been around for a few years, so would be interested to hear if anyone actually has this & how it’s working out).

cheers

It is indeed, but I’d be lying if I said I wasn’t enjoying this little stretch of hot weather

I’m looking forward to taking our basement suite back. It will make days like today a lot more enjoyable.

She, like me, thinks it is realtors and hype that is driving this market, people need to step back and think before offering hundreds of thousands over, it is just madness.

I don’t think realtors and hype are that powerful.

I think it’s very low interest rates, and a great many house-hunters pursuing a low number of available houses, in one of the most desirable cities in Canada.

Global warming is a bitch.

https://weather.gc.ca/city/pages/bc-66_metric_e.html

My friend who listed her home last week, just sold. She listed at what she thought was a fair price and would have been quite happy had someone offered her asking price. She sold to the first offer after receiving three offers all way over her ask price. She, like me, thinks it is realtors and hype that is driving this market, people need to step back and think before offering hundreds of thousands over, it is just madness.

haha Thumps, well yes, the heat pump is on my mind….just applied for that new grant, which so far is a bit of a gong show as the system keeps telling me I haven’t uploaded the right information, but I know I have, and when I “call them” I get non-answers. But perseverance will pay off here, I mean, it’s a 5k grant plus 600 for energy audit, good deal!

Speaking of Royal Bay, what did 314 Whimbrel go for?

Drove by Royal Bay and they seem to be really moving on getting the new section going.

part of the new royal bc museum is going in there. https://www.timescolonist.com/news/local/province-seeks-bids-to-build-new-royal-b-c-museum-complex-in-colwood-1.24335263

Not sure in what world 90k income and 150k savings isn’t financial stability.

I think it is pretty good for someone with small children. The median net worth of a Canadian under 35 is 48k.

And, you win that the mellinials are have it hard, so perhaps as a kind person that you are you can sell your house cheap for a letter.

I’ve made it quite clear that I want house prices to go down across the board, and that includes my house.

In other words, you’re not willing to give us the numbers to back up that absurd claim about monthly payment.

It was my parents house and I only help paid for it, so I don’t have all the numbers memorized, beside my parents are dead so I’m sorry you have to wait.

And, you win that the mellinials are have it hard, so perhaps as a kind person that you are you can sell your house cheap for a letter.

I’ve been a landlord and rented to people with both cats and dogs. Both made it hell for me. These people were not “good” pet owners. They never took their dog for a walk like he so deserved for being cooped up all day while they were at work. They put him out in the (my) yard and I had to get someone to clean up that basically smelly sewer when they moved out. Then there was the lady with one cat (actually it was at least 3), who let the cats pee all over the place. Never cleaned their litter. They were not happy cats and she was not a loving pet owner. I hired two men to rip up all carpeting, clean the cement under it and basically sterilize the entire apartment. They had to wear masks and gloves and every couple of minutes it was necessary to step outside to get some air. One guy couldn’t take it.

On the other side of the fence I and many others are or were great and responsible pet owners. And having one (and why do you need more than one ?), made the world of difference in our families lives. There isn’t a day go by that a happy memory doesn’t pop up for me of our wonderful family dog. He was 17 went he had to be put down. I was 17 too……….so my entire childhood was spent with him.

And then there are the ones that don’t like animals or just don’t want one. I think we should all be able to understand and respect that as well.

But as Totoro put it a few comments ago, she deals with what is and not with what we would like it to be. So having a pet especially if you are renting will sadly limit so many options for you.

“Well I hope you see it that way if it turns out that failing the stress test is the only thing that prevents you from qualifying for the mortgage to buy the house you want and can afford. Seems like you’d be “taking one for the team” (taking yourself out of the pool of prospective buyers) , but it sounds like you’re OK with that.”

If a person can barely afford to buy a house at record low interest rates, it seems prudent to ensure that the person can handle a modest increase in monthly housing expenses. Perhaps the qualifying rate is too high, and some folks are obviously able to get around it, but in principle I support the stress test.

As for me, I’ve already taken myself out of the pool by buying the house I could afford, which was below what I qualified for. I would never take out the maximum mortgage because that would increase the risk of me having to toil with the “hustle culture” crowd, which sounds pretty awful.

Not sure in what world 90k income and 150k savings isn’t financial stability. Uprooting a family is a big deal, and believe it or not, some people like to have their kids grow up with a dog. Is that really a privilege only for the wealthy as well now? I feel like I’m living in some sort of alternate reality now. How is ditching part of your family, uprooting your kids and leaving town the “right” decision? Big yikes.

I don’t mean to be harsh here but your kids growing up with a dog is way less important than growing up with stable housing – one is a want and the other is a basic need. New rental housing when you have kids can be found with effort, but when you have pets the odds shrink astronomically. I would say the only time it would be a reasonable decision to get a dog as a renter in our market is when you are in pet-friendly, stable, purpose-built rental housing or something like a coop which allows pets. If you are in private market housing where the owner can move in or sell then I would not recommend getting a dog or cat. I’m on a rental housing site and 3/4 wanted ads are from people with pets who cannot find anywhere to live – island wide pretty much and the same in the Okanagan.

@Patrick

Cool, let me just check the 9 available options (including Langford) at $3000/mo or less to find one suitable for children, and then see how many of the ones left actually accept the applicant with a dog and kids!

@Patrick

Not sure draining your savings and maximizing your leverage in a rising rate environment is necessarily the best call for some families. A move to Langford is still incredibly disruptive for a family with roots in a neighbourhood, as is ditching a family pet for the sake of keeping a roof over your head.

I get that you’re trying to find a timely and realistic solution to the scenario I described. And you’re absolutely right, the reality for many families that lose their rental in this market is they will have to pack up and go or make some serious adjustments to their living arrangements.

not sure what lender will give you that size of a mortgage with $90k family income and a 120k downpayment. Don’t forget strata fees.

There are others here that know the ins/outs of qualifying. I wouldn’t expect an online RBC calculator to be the last word on the subject of maximum mortgage that you can get. But I’m sure that, other than the big banks, you’ve been to an independent mortgage broker, as they can give you good advice.

@Barrister, blame the victim eh? Not sure in what world 90k income and 150k savings isn’t financial stability. Uprooting a family is a big deal, and believe it or not, some people like to have their kids grow up with a dog. Is that really a privilege only for the wealthy as well now? I feel like I’m living in some sort of alternate reality now. How is ditching part of your family, uprooting your kids and leaving town the “right” decision? Big yikes.

“As an aside, it seems that the stress test is the biggest obstacle to this person qualifying to get this, yet almost noone including government affordailibity panels is suggesting it be removed to improve affordability.”

Maybe because it’s good policy? I don’t see how removing the stress test would improve affordability. It would just allow people to borrow more and expand the pool of prospective buyers, driving up prices even further.

“What is with this repeated sentiment that “first time buyers all want a sfh in the core”? I don’t get that feeling from anyone hunting on this blog.”

I agree, but it seems to go along with the “millennials are entitled and the housing crisis isn’t real” narrative.

For cost reference because we’re in the same income bracket fatigued described with a bit less downpayment: that 599k townhouse will probably sell around 700k,

You’re obviously looking closer at this than me, but 700K would represent 700/474 = a 48% premium to assessed value. Just saying, because average premium measured by Leo is +25% for townhouses. Is it really that high a premium these days?

What is with this repeated sentiment that “first time buyers all want a sfh in the core”? I don’t get that feeling from anyone hunting on this blog. We started with looking at the Westshore and now look up to Shawnigan, Vic is totally unattainable.

For cost reference because we’re in the same income bracket fatigued described with a bit less downpayment: that 599k townhouse will probably sell around 700k, I have these in my PCS, view some and follow all. There’s a $360/m strata which puts my monthly cost after 10% down (so need CMHC), PTT, closing and property tax: $2,974. Add $1700/m daycare and we can do it but are going to eat a lot of beans, what a stretch.

Move to Sooke you say… I commend families that can do this. My partner and I work in the core & at UVic and cannot do our jobs from Sooke. Add daycare and preschool drop offs and pick ups, a one lane road, and you may figure out why we’re not going.

Patrick lets do the math. When a mortgage broker runs an application they look at the Total Debt Service Ratio (TDSR) and the Gross Debt Servicing Ratio (GDSR). Total debt servicing ratio takes into account the new payments of the home and any current monthly payments (student loans, car payment, loc, credit card etc). Assuming you have no other debts then the only ratio that matters is the GDSR. I just called a broker friend and they confirm the max GDSR on an application is 39% (without special exception request). That means the payments of your home can’t exceed 39% of your gross monthly income.

So 480k mortgage at the BENCHMARK rate (for purposes of approving) – which is 5.25% – lets assume 30 year mtg since you can get that with 20% down the payment calculates out to be $2,634. Then they look at strata, property tax, and heat (3 cents per square foot of a condo of 5 cents per square foot on a TH or house). In this case the strata is $360, the property tax monthly is $188 (they wont’ take the grant into consideration) and heat is 5 cents at 1700 sq ft or $85. So $2634+$360+$188+$85 = $3267 monthly obligation for housing costs. . Working backwards, 3267/.39% is $8377 monthly income required to qualify for this property – or $100,527 a year. That’s the minimum income required to qualify for this property. If you have less than 20% down its a 25 year am and a guarantee that you won’t get an exception to these ratios – you MIGHT get one if you have 20% and are a strong borrower.

So I would say you need to be making more than the median income in Victoria in order to possibly get a townhome in Westshore.

This was not my main point anyway – i’m not saying its impossible to find a place if you are willing to sacrifice time and move out to Sooke, or Duncan or take on a project that basically values a home only at the land as its so beat up. My point was simply that – factoring in incomes only – its much harder to get a afford a place today then it was a year ago, 5 years ago etc. Looking for a TH for 600k 6 years ago you had tons of options all across Victoria – you could easily get a full home with a suite for this in 2015. Today you are relegated to the outer edges (which the boundary keeps expanding) and the same incomes qualify for even less due to the B20. Wages have not increased at the same rate, obviously.

It would be interesting to know how many people who were born and educated in Victoria left for greener pastures in the last 50 years. Victoria could not provide the opportunities other major cities offered and professionals had no other choice to advance their careers but to move away. Many are now reaching retirement age and are possibly considering moving back to their old stomping grounds. Any anecdotal evidence out there?

and intergenerational economic success.

That’s a nice way of saying class immobility. I’m not saying that it’s a bad thing to help your adult children, I’m just saying that it’s a bad thing that it’s needed just to obtain the lifestyle that people used to get in return for working.

I’m in favour of assisting adult kids with housing and childcare in a reasonable way. Just my two cents, but if you have worked hard to create a good life for yourselves I think there is great pleasure in sharing that with those you love, and in having grandchildren to help with. I find bumper stickers like “I’m spending my children’s’ inheritance” distasteful. The fact that it is even a bumper sticker says a lot about the fractured nature of families in North America and the lack of insight into how interdependence can create greater good for everyone – and intergenerational economic success. If you have experienced home appreciation and can help your child out why wouldn’t you – with appropriate written agreements in place to protect everyone.

In March of 1983, I helped my parents purchased and mortgage payment on our modest 1700 sqf 3 beds, 2 bath home in Victoria core and our 5 year variable monthly payment were north of $2000.

We’ve been though this before. In March 1983 the 5 year fixed rate was 13.5%, variable would be less. You could get a modest house in Victoria for $100K. With 25% down, your mortgage payments on 25 year would have been $670.87 a month.

Either show us all the numbers or cut the BS.

Someone was asking if 828 Rockheights Ave was a fair price. We’ll it sold well over asking at $1.376M, previously sold 6 months ago for $836K(substantial reno). I think that is insanely expensive but the market clearly disagrees.

Took the night off and missed all the chatter. Patrick – fair enough the data may not show what i’m suggesting. As opposed to picking out age groups and places across the country lets just agree that if today you are relying on income to purchase a home, it is one of the worst times to do so in history. When I say ‘home’ I mean a family home – 3 bedrooms or more (lest exclude condos since 3 bedrooms are incredibly rare) – so a townhome or a house – i think leos chart with 1200 sq+ is reasonable. Now because house prices are higher than ever – we have a lot of boomer parents who are millionaires just due to home ownership that can help their kids which skews the data.

If you are trying to argue because homeownership rates are high that means it easy for people to get a home then clearly that’s only the case if you have help. So – the point i’m making is if you don’t have help or a windfall of some type home ownership is much tougher today then my parents, and there parents, had based on only their own income. And specifically in Victoria we have that chart from Leo which clearly shows this –

Would you agree with that?

Patrick: I think that you have a point about the delayed life patterns. When I think about it my dads first full time job was at 14 in a Welsh coal mine. Large family with too many mouths to feed at home. I am told that he was a big strapping lad at that age so it was time to earn his keep. A lot of kids these days dont have their first full time job till their mid or even late twenties.

Just comparing by age is really misleading if one does not adjust for the shift in life stages.

Most estate sales have a house attached to them, and getting a foot in the door before they are listed can be very advantageous.

The only advantages to estate sales right is no need to write a douchebag letter or have to do a foolish back and forth because it just goes to a committee or executor that reviews the offers and picks the easiest to close at the highest price (I have been in on a few of them lately). However, there really isn’t a deal to found there either. A lot of big unconditional bids on dilapidated properties.

The good news is that there are still homes you can afford in Sooke and Duncan.

I have Sooke and the Cobble Hill to Cowichan areas in my areas for looking. It is slim pickings and the properties that list 650k to 800k in those areas get a lot of activity. The market all over is simply being driven by a lack of listings.

I don’t begrudge people getting the high price while they can and realtors are just creatures of habit getting their windfall while they can. This is a peak and a prolonged stagnation will probably hit the market and listing will grow. Anyone buying right now will have to accept they might be in a negative equity position on there next mortgage renewal. I just won’t sympathy for the ones that are forced to sell and they don’t multiple buyers or even one buyer right away when they list. I won’t care if they need money because of a divorce, death, job loss or too much debt; I will make the offer that best benefits me.

You seem to be switching between talking about the fixed 20-34 year age group over the course of 20 years to now arguing about Millennials as a cohort.

Yes. I’m talking about Millenials as a cohort, when comparing generations. And you should be too, because there are big differences between the generations for the ages that they move through various life stages (live at home, go to uni, get married, have kids, buy a house). And I detail this below.

We shouldn’t, for example, be alarmed or concerned if millennials are underperforming boomers (at same age) in terms of age of buying first home.

Why?

Millennials have been late starters for everything. This has been well publicized, and people refer to this by the life stage term “emerging adults” https://en.wikipedia.org/wiki/Emerging_adulthood_and_early_adulthood

This is detailed in data in an article by pew research. https://www.pewresearch.org/social-trends/2019/02/14/millennial-life-how-young-adulthood-today-compares-with-prior-generations-2/
They compare ages and outcomes for the various generations, standardizing for the same age range and adjusting $ for inflation.

Compared to boomers at the same age, Millennials:
– stay in school (university) longer, (39% college degrees, vs 25% boomers)
– live at home longer, (16% vs 8% boomer)
– get married later, (46% are married vs 65% boomer at same age)
– form households and families later (less kids, at a later age)

And btw, boomers were later age in than their previous “silent” generation for achieving many of these same metrics, though not as pronounced

So at age 25, a millennial is likely in university, a boomer was working, and a silent (previous to boomer) generation was likely married with two kids..

Despite this, millennial earnings are the same or better than boomers. Because millennials have spent more time in uni getting educated. For example, (as shown in the pew research article), with a college degree, Millenials households earn $105k while boomers were $88k (inflation adjusted).

So surprise!…. Millennials also buy homes at a later age than previous generations. This is because buying a house is associated with household formation (marriage, having kids) and they are choosing to do that later.

So the point is, when it comes to housing, don’t put too much weight comparing the same age groups over the generations, because you’ll just be finding these “later to adulthood” trends.

Instead, follow the Millennial cohort over time, and you’ll see they match or exceed previous generations housing metrics, just at a later age. Then you won’t look at age based differences for housing metrics, and assume it is evidence of a “housing crisis” (as you did in your “millennials:Y U No own?” article).

Instead, you can focus on “good news” housing metrics, like the “at or near” record home ownership that Canadians have achieved in 2021. This is largely based on recent 2020-21 big gains from the well educated, and now house-hungry millennial cohort. And we will see continuing housing gains for years to come.

Some advice I can offer to frustrated house hunters is to stop running from property to property listed with an agent. Although the pandemic has curtailed estate sales, that is where you should be looking. Most estate sales have a house attached to them, and getting a foot in the door before they are listed can be very advantageous. I’m in the antiques business and we are usually called in first to deal with the contents. The homes are usually in various states of disrepair and require a massive clean out. In some cases, the heirs are intimidated by the process and are open to a private offer to sell the house privately in “as is” condition. Many of them have to come from other cities to deal with their parent’s property and belongings. Some realtors offer clean out services, most prefer a quick, clean listing that they can sell with little effort. So start scouring online ads advertising an estate sale and go to them instead, you might get lucky. It’s a bit of a long shot but it has worked for me. I’ve suggested to real estate agents friends of mine that they should attend estate sales to make contact with the sellers, none of them have taken my advice. Maybe it violates some code of ethics, but I’m sure there is a way to introduce yourself that would not be considered aggressive.

My first house in Toronto was an hours drive out and the interest rate was absolutely crippling. So I am not sure it was any easier back then.

Not sure exactly when that was, but I bought my first house nor far from the centre of the City of Vancouver on one income in the 1980’s. I was under 30. But you see, prices were far lower compared to incomes back then, and it was not hard to save a good sized down payment which put higher rates to your advantage. As for TO:

The average price of a house in Toronto back in 1984 was just over $96,000. I wasn’t buying just then, but it’s worth noting that the average family after-tax income back then was close to $50,000. Buy a first home? Easy to imagine for new graduates of the day.

That’s actually a bit less than Vancouver at the time.

https://www.theglobeandmail.com/globe-investor/personal-finance/2012-vs-1984-young-adults-really-do-have-it-harder-today/article4105604/

https://www.livabl.com/2018/01/chart-greater-vancouver-prices-climbed-4-decades.html

Any tips on going unconditional?

We did the unconditional offer a few weeks ago (didn’t get it). We were able to stay at our 20% down, so CMHC approval for the finance wasn’t on the table for us (but if it was, we would have the finance and appraisal condition). Because we were going unconditional, we weren’t going to go with the big over bid (I knew I needed to spend another 100k if my offer was accepted), but the next person did unconditional and added over 100k to the offer. The hunt for the 3rd bedroom is tough. I would be be comfortable renting a 3bdr place, but I just can’t stomach laying out 3k a month on a crappy old upper or lower of poorly reno/split 60s70s box.

Cad, hopefully we can avoid offering on the same places..lol.. Maybe we should see about grouping some buyers together and coordinate not offering on the same places.. or even better.. make offers look stronger by having folks submit low ball heavy conditioned offers on the same places we offer on, to make our offers look better…..lol

Anyways, on the bidding side, there has been far fewer offers on the places I have been chasing lately, just can’t account for the one big overpay that still comes in. So, I am sticking to my process, plan, flexibility and budget and eventually something will shake loose.

House Attempt
Viewed an older home with a suite, booked an inspection right away with the plan to go unconditional on the offer. Inspection identified some things we could fix over time but nothing huge. But because the sellers identified their suite as a “latent defect” which seemed incorrect we had to go conditional on financing because it would have been a red flag to CMHC to explore and we don’t have 20% down so need the mortgage insurance. Suite was brand new so shouldn’t have been an issue and we went well over ask with only one condition. Lost to a no-conditions offer, they didn’t even counter us.

Feeling really burned again, we wrote a really detailed letter (sorry Marko) and got pretty excited about the house and the potential end to this horrible game of house hunting. I’m not just upset at the house but that it feels like we’re being knocked down at all angles. We can’t find a 3 bedroom sfh for under 700k so a suite makes the 800k level attainable where we could get the space we require. But because I can’t just double my downpayment we’re stuck with CMHC (and the $31,000 cost!). Feels like a poor tax but we’re solid middle class.

Any tips on going unconditional? We’re ready to YOLO.

Patrick, that is the market housing you are referring to. All the relevant details are summarized neatly in the Wiki page. You have to take your visors off once in a while. ha

https://en.wikipedia.org/wiki/Public_housing_in_Singapore

Dream home becomes nightmare for Ontario family who passed on home inspection

https://toronto.ctvnews.ca/dream-home-becomes-nightmare-for-ontario-family-who-passed-on-home-inspection-1.5481307

Discovered it needed a 130k in work after they moved in, I wonder how many of these sob stories we are going to get here locally in the next year from suckers that both over bid and put in no condition offers on properties that also maxed out their budgets. You would at least think that a person would try to get it looked at before submitting the offer by bringing the inspector at the viewing time before the unconditional offer is sent in.

Quick stat:

Last 10 years, the Singapore home ownership is about 90%. Out of the 90% home owners, 9/10 are on the HDB scheme. The others are kazillionaires! 🙂

https://www.statista.com/statistics/664518/home-ownership-rate-singapore/

I think you’re confusing a corporate survey designed to create pretty infographics for data

…. Says the guy who just based an entire article “with pretty infographics” and many conclusions, based on the Victoria RE buyers survey, which is an optional survey not even filled out by the buyer, instead filled out by some of the agents.

“Insights from the VREB Buyer Survey”
https://househuntvictoria.ca/2021/06/14/insights-from-the-vreb-buyer-survey/

And you have no problem referring to it as “data” no less than 10 times in your article. Yet you cannot accept a royal lepage survey as data.

It wasn’t a “corporate survey”. The Royal LePage survey was of 2,000 people age 25-35 done by LEGER, a respected pollster, using an LEGER online panel
The LEGER panel is highly respected in polling and they discuss why here https://leger360.com/services/legeropinion-leo/

https://marketing.rlpnetwork.com/Communications/Royal_LePage_2021_Demographic_Survey_table.pdf
“ About Leger Survey. An online survey of 2000 Canadians aged 25-35 was completed between December 29, 2020 to January 8, 2021, using Leger’s online panel. No margin of error can be associated with a non-probability sample (i.e. a web panel in this case). For comparative purposes, though, a probability sample of 2000 respondents would have a margin of error of ±2.2%, 19 times out of 20.”

I think you’re confusing a corporate survey designed to create pretty infographics for data.

So stick with census data. Is there some outrage about millennial home ownership shown in this CENSUS DATA?

2006, 46%. (age 20-34) statsCan
2011 47% (age 20-34) statsCan
2016, 44%(age 20-34) statsCan

Is the drop from 46% to 44% illustrative of the outrage that is preventing millennials on this board from getting “basic shelter”?

https://www150.statcan.gc.ca/n1/daily-quotidien/171025/cg-c004-eng.htm

The 2016 millennial age 20-34 cohort is now age 25-39, obviously they have added a lot to their 44% ownership in those 5 years, as shown in the royal lePage 2021 survey,

On the meaningless fact thread, two of one neighbours kids bought their first house this year and two other neighbourhood kids bought condos. all in their late twenties.

My first house in Toronto was an hours drive out and the interest rate was absolutely crippling. So I am not sure it was any easier back then.

What I do find rather strange is that people here talk like the West shore is somehow way out of town. The tirty something guy whp trims my hedges and trees just bougt his first property and it was a SFD in Saanich.

But it will be interesting to see the stats Canada numbers.