300k$ houses accross Canada

[Valmy]

I don't see why I need to be super in order to own a house. Plenty of people own houses without dressing up in funny costumes and fighting crime.

[Josquius]

I've been thinking of buying a flat in Newcastle.
Somewhere to live if I ever move back to the north east.
In the meanwhile it can be rented out and help cover the cost of my rent a bit.
My dad works in building restoration so can do a lot of the upgrades and repairs himself or get friends to do it for cheap.

[Valmy]

I've been thinking of buying a flat in Newcastle.
Somewhere to live if I ever move back to the north east.
In the meanwhile it can be rented out and help cover the cost of my rent a bit.
My dad works in building restoration so can do a lot of the upgrades and repairs himself or get friends to do it for cheap.

That might be a great plan depending on the rental market. Make sure you inspect each prospect yourself personally.

[Malthus]

Yeah I disagree with that. Part of housing is to get a home but another large part of it is to get an asset that will most likely increase in value and that you can then use when you're in old age - incidentally this is a bit of our housing crisis that worries me is the sheer cost of a large increase in the number of elderly people who are renting.

That belief in "making a profit" is what continually burns people in housing as well as hurts people professionally as they cannot relocate easily for better jobs.

Old people "aging in place" is also a negative as cost of living increases (taxes, utilities, maintenance) while income decreases, and it is much harder emotionally and physically (not to mention market timing) to leave behind an old home.

Anecdotally, owning a house has been a very good financial decision for me.

To my mind, one factor stands out above all others: paying down a house forces people to save money.

In theory, there is nothing stopping someone from renting and saving money in other forms of investments. What I have seen, though, is that in reality unless people are coerced somehow into saving, they tend not to - there is always some new reason to spend their money that month. So they spend.

[Valmy]

Well typically it costs more to rent than to buy, per month anyway, and then you have to invest over that amount in order to save. Whereas if you are making a mortgage payment you get savings in addition to paying your 'rent'. So it makes sense. You are going to be spending that money anyway so it is nice it also funds a savings thing as well.

On the other hand if you buy you have to upkeep your place and selling a house can be a real nightmare. Plenty of people have gone bankrupt betting on realestate, she is a cruel mistress. Nobody ever went bankrupt renting (well they might have gone bankrupt while renting but not because of renting )

[schaksen]

Nobody ever went bankrupt renting (well they might have gone bankrupt while renting but not because of renting )

No they are evicted before that.

[Valmy]

No they are evicted before that.

Better than a foreclosure.

[Malthus]

Well typically it costs more to rent than to buy, per month anyway, and then you have to invest over that amount in order to save. Whereas if you are making a mortgage payment you get savings in addition to paying your 'rent'. So it makes sense. You are going to be spending that money anyway so it is nice it also funds a savings thing as well.

On the other hand if you buy you have to upkeep your place and selling a house can be a real nightmare. Plenty of people have gone bankrupt betting on realestate, she is a cruel mistress. Nobody ever went bankrupt renting (well they might have gone bankrupt while renting but not because of renting )

I think deliberately buying houses as an investment vehicle is best left to the experts. OTOH, having the 'shelter expense' also include an investment component is a nice little bonus - only, I wouldn't count on it paying off in every market.

We've been luck that way, in that the Toronto real estate market has continued its insane growth for years without any sign of stopping (despite the experts who, reliably, every year for 15 or so years now, have been proclaiming that we are in an unsustainable bubble that will pop any moment now! Well, they will be right one day, I assume).

We bought our house in 2005, against the best financial advice (the bubble will pop any minute now, save your money and buy after ... was already the message, even then). Since then it has more than doubled in value ...

[Valmy]

And you never lost your job and couldn't find another one without moving and then couldn't sell your house. Probably not a big thing to be concerned about in Toronto but in most towns out there this is not inconceivable. That will bring about a financial crisis for most people.

[Malthus]

And you never lost your job and couldn't find another one without moving and then couldn't sell your house. Probably not a big thing to be concerned about in Toronto but in most towns out there this is not inconceivable. That will bring about a financial crisis for most people.

Heh, every once in a while I get real estate agents and others coming right to my door and begging to buy my house, saying they have buyers lined up and suggesting (improbable) prices it would fetch. Once, I got a beautifully hand-written letter from someone. I opened it up, and it started out as a letter as if from some long-lost friend of mine ... went on for a couple of pages chatting about this and that in her life ... and ended being: a shill from a real estate agent, wondering if perhaps I wanted to sell my house ...?  I'm almost sorry I didn't keep the letter, it was a beautiful effort, and must have taken someone half an hour to write.

Of all the things I worry about, being able to sell my house is low on the list. Mind you, the market here is utterly insane, has been for years. I feel sorry for any poor sucker looking to buy. It was horrible when I did it back in 2005 - going in with a perfectly reasonable offer, only to be kicked in the nuts again and again by absurd bully bids. Was no fun at all.

[Valmy]

Right I mean the dude who bought that house in small town Alberta and then the oil sands thing dried up.

[Malthus]

Right I mean the dude who bought that house in small town Alberta and then the oil sands thing dried up.

True enough. You have to look at the market.

Though I remember when the oil thing was at its height, and people were seriously suggesting that corporations would all move their head offices from Toronto to Alberta ... if that had happened, things may have been very different. 

[Brazen]

The other benefit of mortgages over rental is generally they go down over time, regardless of interest rates, so I'm hoping that as I approach retirement I can a) overpay my mortgage and pay it off earlier b) the relative actual cost will approach negligible. I think Dad's final year of mortgage payments were around £48 a month!

Heavy taxes on second and further buy-to-let properties would help free up more accommodation. I'm the only owner-occupier in my block