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  #21  
Old Posted Jul 6, 2018, 7:52 AM
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I love renting and see myself renting forever vs buying. Not having to deal with a condo board is fantastic, and I love that I’m not personally on the hook for work that needs to be done to the building. Watching the shit my parents deal with at their now 30 year old condo in London is brutal. A few thousand for new windows here, a few thousand for new elevator motors there, another few thousand because the parking garage needs repairs or lighting fixes. Even with a solid reserve fund the maintenance and stress of dealing with the board sucked. It took them 5 years to get the building finances back on track because there were so many residents purely concerned with paying low condo fees. Couple that with the fact that the unit I’m in would never get built in a new build means there is really little reason to buy a place over renting. I guess it just depends on what’s Important to you, but I wouldn’t call people insane for wanting to rent over buying. It’s done all over the world. For a lot of us, having a place to live isn’t about owning an asset.
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  #22  
Old Posted Jul 6, 2018, 1:27 PM
TheRitsman TheRitsman is offline
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Originally Posted by davidcappi View Post
I love renting and see myself renting forever vs buying. Not having to deal with a condo board is fantastic, and I love that I’m not personally on the hook for work that needs to be done to the building. Watching the shit my parents deal with at their now 30 year old condo in London is brutal. A few thousand for new windows here, a few thousand for new elevator motors there, another few thousand because the parking garage needs repairs or lighting fixes. Even with a solid reserve fund the maintenance and stress of dealing with the board sucked. It took them 5 years to get the building finances back on track because there were so many residents purely concerned with paying low condo fees. Couple that with the fact that the unit I’m in would never get built in a new build means there is really little reason to buy a place over renting. I guess it just depends on what’s Important to you, but I wouldn’t call people insane for wanting to rent over buying. It’s done all over the world. For a lot of us, having a place to live isn’t about owning an asset.
Equity. You can do this with investments in stock as well. But I've learned from my family's experience it can be quicker and easier to build equity through real estate. Why do you think so many foreign owners want to buy here?

Like I said, you don't have to live in the unit. That's what I'm doing with my condo, renting it out and paying rent somewhere else. Planning to purchase my second home somewhere else, while my parents are looking at a 3rd and 4th unit.

You can argue against the lifestyle of owning versus renting, but if you can handle the hassle, the financial benefits cannot be argued against. Until the government in some way regulated the investment market, people will make a killing on real estate investment.

This development here is a role model for how condos should be built. The developer is on the condo board for 10 years, plus you can't rent it out without living in it for the first 10 years. This would be a terrible investment opportunity. This is how condos should be regulated. This would negate the requirements for height limits.
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  #23  
Old Posted Jul 6, 2018, 1:52 PM
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I get what you're saying. I just like the idea of buildings being designed for end users vs investors trying to make money on the real estate market. You really see the difference when you look at the unit layouts. I would consider myself an end user and would only ever buy a property to live in. Investing in the Canadian real estate market isn't something I'd touch with a ten foot pole. That's not to say there aren't good investors though, I just know that many more are absent in the operations of the buildings they own in such as not taking part in the condo board, and so are their tenants which is why the maintenance in investor heavy buildings tends to be subpar (rent an AirBnB in the ICE towers in Toronto to see this in action)
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  #24  
Old Posted Jul 6, 2018, 6:42 PM
TheRitsman TheRitsman is offline
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Originally Posted by davidcappi View Post
I get what you're saying. I just like the idea of buildings being designed for end users vs investors trying to make money on the real estate market. You really see the difference when you look at the unit layouts. I would consider myself an end user and would only ever buy a property to live in. Investing in the Canadian real estate market isn't something I'd touch with a ten foot pole. That's not to say there aren't good investors though, I just know that many more are absent in the operations of the buildings they own in such as not taking part in the condo board, and so are their tenants which is why the maintenance in investor heavy buildings tends to be subpar (rent an AirBnB in the ICE towers in Toronto to see this in action)
Absolutely. That's why I am a fan of this proposal. I honestly don't think what my family and I have been doing, buying up properties should be legal.
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  #25  
Old Posted Jul 8, 2018, 5:06 PM
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I think people do not appreciate how much money is involved in real estate. My family essentially bought a place for $200,000 that increased in value by more than double in 20 years. Making $300,000 extra over 20 years is a lot of money, and that wealth just sits there until they decide to use it. If they had rented those 20 years, they would be paying more rent now than then, they likely would not have upgraded, and 20 years of paying rent would have been money wasted.

When people tell me that renting can be better than owning I personally think they're insane. Unless there is a major crash and you couldn't afford the mortgage in the first place buying is always better. You don't even have to live there. Rent it out to someone else, and rent yourself somewhere cheaper so it's easier to move for work and such
I find it insane when people don't look at ALL the costs involved in renting vs. owning.

One can't just compare rent vs. mortgage payments and how much equity a homeowner accumulates.

To make a full comparison, we need to factor in property tax, utility costs, annual maintenance costs (either out of pocket for a freeholder, or in condo fees), and periodic repair/replacement/rehab costs. There are lots of other things that people don't often consider too: homeowners tend to need purchase and maintain things that renters do not if they're in a multi-unit building, such as major appliances, lawnmowers and other garden equipment and tools, some have snowblowers, etc. Depending on the comparison being made, larger spaces may demand more furnishings, and be more costly to redecorate from time to time.

There's also the value of time put into taking care of a property... a homeowner doing it themselves won't be paying money for this service, but their time has a value.

Inflation is a biggie too. That "$300,000 extra over 20 years" is a lot, but the purchasing power of that money erodes substantially over that period. A renter who is able to save the difference between home ownership and their rental costs does need to invest that savings wisely, otherwise yeah they have nothing to show for it compared to the homeowner, but they could end up with something comparable or larger than that change in wealth related to home value.

It's not a simple comparison. It also depends what is being rented, and the space needs of the renter and their family... Someone renting a 3 bedroom detached home may be paying a lot more of those additional costs than they would renting a 3 bedroom apartment.

Bottom line to me: sometimes it makes sense to rent, sometimes to buy, but it depends on the individual/family and what they need, and their existing financials and future plans as well.
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  #26  
Old Posted Jul 8, 2018, 7:23 PM
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Originally Posted by ScreamingViking View Post
I find it insane when people don't look at ALL the costs involved in renting vs. owning.

One can't just compare rent vs. mortgage payments and how much equity a homeowner accumulates.

To make a full comparison, we need to factor in property tax, utility costs, annual maintenance costs (either out of pocket for a freeholder, or in condo fees), and periodic repair/replacement/rehab costs. There are lots of other things that people don't often consider too: homeowners tend to need purchase and maintain things that renters do not if they're in a multi-unit building, such as major appliances, lawnmowers and other garden equipment and tools, some have snowblowers, etc. Depending on the comparison being made, larger spaces may demand more furnishings, and be more costly to redecorate from time to time.

There's also the value of time put into taking care of a property... a homeowner doing it themselves won't be paying money for this service, but their time has a value.

Inflation is a biggie too. That "$300,000 extra over 20 years" is a lot, but the purchasing power of that money erodes substantially over that period. A renter who is able to save the difference between home ownership and their rental costs does need to invest that savings wisely, otherwise yeah they have nothing to show for it compared to the homeowner, but they could end up with something comparable or larger than that change in wealth related to home value.

It's not a simple comparison. It also depends what is being rented, and the space needs of the renter and their family... Someone renting a 3 bedroom detached home may be paying a lot more of those additional costs than they would renting a 3 bedroom apartment.

Bottom line to me: sometimes it makes sense to rent, sometimes to buy, but it depends on the individual/family and what they need, and their existing financials and future plans as well.
Well said.

Agreed, people seem to over-simplify the comparison.

You bring up a lot of good factors that people seem to forget about with regards to buying a home.

I hate hearing the mantra "I don't want to pay someone else's mortgage". It's more complicated than that.

The correct answer to the question of whether it's best to buy or rent is: it depends.

And this is coming from someone who's a homeowner.
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  #27  
Old Posted Jul 8, 2018, 8:17 PM
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Quote:
Originally Posted by ScreamingViking View Post
I find it insane when people don't look at ALL the costs involved in renting vs. owning.

One can't just compare rent vs. mortgage payments and how much equity a homeowner accumulates.

To make a full comparison, we need to factor in property tax, utility costs, annual maintenance costs (either out of pocket for a freeholder, or in condo fees), and periodic repair/replacement/rehab costs. There are lots of other things that people don't often consider too: homeowners tend to need purchase and maintain things that renters do not if they're in a multi-unit building, such as major appliances, lawnmowers and other garden equipment and tools, some have snowblowers, etc. Depending on the comparison being made, larger spaces may demand more furnishings, and be more costly to redecorate from time to time.

There's also the value of time put into taking care of a property... a homeowner doing it themselves won't be paying money for this service, but their time has a value.

Inflation is a biggie too. That "$300,000 extra over 20 years" is a lot, but the purchasing power of that money erodes substantially over that period. A renter who is able to save the difference between home ownership and their rental costs does need to invest that savings wisely, otherwise yeah they have nothing to show for it compared to the homeowner, but they could end up with something comparable or larger than that change in wealth related to home value.

It's not a simple comparison. It also depends what is being rented, and the space needs of the renter and their family... Someone renting a 3 bedroom detached home may be paying a lot more of those additional costs than they would renting a 3 bedroom apartment.

Bottom line to me: sometimes it makes sense to rent, sometimes to buy, but it depends on the individual/family and what they need, and their existing financials and future plans as well.
It can make sense to rent in some rare cases - but real estate generally needs to be extremely over-valued.

The equity built in owning makes it extremely difficult for renting to be a better financial decision. Renting is generally cheaper, true, but owning will generally build wealth more as you are "throwing away" less of your money overall.

I remember 2 years ago looking at housing in Newmarket at the peak of the market - detached homes were selling for $1.2-1.3 million while you could rent one for $2500. That was a rare situation where renting would have been better.. the interest alone on a $1.3 million home in your mortgage is probably $2500.. now that same house is selling for $800-$900k, and owning had returned to be a better option.

Let's say you buy a $600,000 house, vs. Renting that same house for $2500. Mortgage is probably $2500/month, presuming 20% down. Property taxes probably another $400, maybe $500 in maintenance a month, at most. Total monthly cost is $3400. Way more than $2200, right? Thing is, about $1500 is being built in equity each month, increasing slowly every month as your mortgage matures. So even at month 1, the house is truly costing you only $1,900 a month. Plus you get to take in any price appreciation the house incurs, and have a property to call your own.

The only time renting is really better is if housing prices become extremely over valued, like they did in York region 1-2 years ago.

I also hold an aversion to condos as condominium fees tend to be a lot higher than maitenence costs on detached properties from my experience - making it tougher to make the finances work. Plus they don't have the appreciation potential of detached homes due government their near unlimited supply of new stock.
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  #28  
Old Posted Jul 14, 2018, 3:28 AM
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Originally Posted by Innsertnamehere View Post
It can make sense to rent in some rare cases - but real estate generally needs to be extremely over-valued.

The equity built in owning makes it extremely difficult for renting to be a better financial decision. Renting is generally cheaper, true, but owning will generally build wealth more as you are "throwing away" less of your money overall.

I remember 2 years ago looking at housing in Newmarket at the peak of the market - detached homes were selling for $1.2-1.3 million while you could rent one for $2500. That was a rare situation where renting would have been better.. the interest alone on a $1.3 million home in your mortgage is probably $2500.. now that same house is selling for $800-$900k, and owning had returned to be a better option.

Let's say you buy a $600,000 house, vs. Renting that same house for $2500. Mortgage is probably $2500/month, presuming 20% down. Property taxes probably another $400, maybe $500 in maintenance a month, at most. Total monthly cost is $3400. Way more than $2200, right? Thing is, about $1500 is being built in equity each month, increasing slowly every month as your mortgage matures. So even at month 1, the house is truly costing you only $1,900 a month. Plus you get to take in any price appreciation the house incurs, and have a property to call your own.

The only time renting is really better is if housing prices become extremely over valued, like they did in York region 1-2 years ago.

I also hold an aversion to condos as condominium fees tend to be a lot higher than maitenence costs on detached properties from my experience - making it tougher to make the finances work. Plus they don't have the appreciation potential of detached homes due government their near unlimited supply of new stock.
I don't think it's that rare. In your case, it made sense to you to purchase, especially given the price trend.

My point was just that one has to look at all costs involved, not just regarding purchase but ongoing "living" costs too, as well as the opportunity cost of the difference in monthly housing expenses (including the down-payment). It really does depend on the situation.

For many people it's an emotional decision though. Unless the property is about an investment, I think it's what "home" means to them that matters. And there are probably a lot of renters that do not invest any savings they realize compared to the option of purchasing if that was available to them.
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  #29  
Old Posted Oct 10, 2018, 2:24 PM
TheRitsman TheRitsman is offline
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I may have just forgotten, but does anyone know where this development is along its plan? All news went dead, despite it being a really cool project, and seemingly a lot of interest in purchasing units.
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