Housing costs

[Gary]

Hoping the house goes up in value is optimistic investing.

Don't you just hate it when you come across a pessimistic investor?

Here's some concrete historical numbers (all in Hamilton) ....
1922.... grandfather paid $975 for the house my dad grew up in.
1973.... dad sold it (gramps passed) $18000.
1955.... dad bought family home $8200.
2011.... I sold it (parents passed) $202000.
1983.... I bought my 1st house $32000.
1987.... sold the above $65000.
1987.... bought 2nd house $90000.
1996.... sold it $128,000.
1996.... bought bach pad $60000.
2012.... sold it $135000.
2012.... upgraded bach pad $270000.
2019.... still here value $600000.

The trend above will likely continue until the planet is on fire, imo.
My highest mortgage was 13.5%, although they went to 21% at some point, I was locked in a 5yr, luckily.

 

[Trials]

The Land is the investment, the house is a material expense just like the hydro, well and the septic system, but you don't really own it you just have the right to use it and pay taxes on it while you are alive.
A property investment is something you never realize until you sell it and That is when its actual worth is established. imho: if the government values your land too high you should have the right to say: SOLD! you own it now, show me the money! but that is one of the reasons they express your property tax according to a mill rate.

 

[meme]

I think that kids don't work, don't pay for school, and don't have down payments. Of course they have no idea how to save.

20% of every single penny earned has been saved, starting from paper routes when I was 10.

Graduated HS in 91, out of college/uni in 94. Worked 3 jobs paying off school loans til 96, got a real job in 97 and came up with first condo down payment in 99.

Bought a house in 2005, paid off by 2017.

School in Peterborough where I could afford to go, crappie apartments no where near TO (ajax, whitby, stoufville) until 99 when I bought the condo in Guildwood.

House is in a little town in Durham.

Keep holding out guys, so when I buy the retirement home it's the millenia that will pay for it. It's a great plan, for me.

 

[ChrisCBR]

1983.... I bought my 1st house $32000.

Your rebuttal to my argument in the other thread was "stop the bs". Then we find out you bought your house for $32K in 1983, when median household income was $31K. You bought your house for almost the equivalent of 1 years worth of median household income and your throwing mud at people claiming its not harder today. Thats the equivalent of being able to buy a house for $89K today when that same house is $850K.

2012.... upgraded bach pad $270000.
2019.... still here value $600000.

Those so called pessimistic investors are actual rational investors. They realize that interest rates at historical lows, local and foreign speculation have driven this exponential rise in housing prices to the point where they are huge multiples of the average persons wages.
You suggest that these returns over the past several decades will continue while anyone who looks deeper realizes that to continue on that path housing prices as a multiple of income would have to continue to rise.
Your bachelor doubled in value in 6 years. I wouldnt expect it to be worth $1.2 mill in 2025.............

 

[ChrisCBR]

I think that kids don't work, don't pay for school, and don't have down payments. Of course they have no idea how to save.

Nonsense. Young people do work and they pay for school.
Funnily enough, most of the people I know who bought in the past several years barely worked when they were younger, didnt work when in school, lived at home rent free until they hit 30, never payed for food and had their parents pay for their whole education. They got jobs, had no education debt and their parents fronted the money for down payments.

 

[ChrisCBR]

I like how the numbers are presented. I didn't research to see if they were accurate.

They arent. You can check the other thread for accurate numbers.
He has taken median household income and divided by 2 to get median individual income for 1984.
Applying the same math we get $45K as the median 2018 income, not $58K

Fact is down payments are much higher now. Saving money is much harder now due to rent as a % of income being far higher today.
You could afford to buy a house and raise kids on 1 income back then.
Two incomes back then and you could buy a house and a cottage...
Adjusted price of gas was 87 cents a litre and Im sure it was even less in the 70s.

 

[Trials]

Housing costs are going to increase because they are making the kids bigger now.
Heck even the cars and motorcycles are getting too be too small for the average merican that feeds on hormone chicken and steroid beef.

 

[Gary]

Your rebuttal to my argument in the other thread was "stop the bs". Then we find out you bought your house for $32K in 1983, when median household income was $31K. You bought your house for almost the equivalent of 1 years worth of median household income and your throwing mud at people claiming its not harder today. Thats the equivalent of being able to buy a house for $89K today when that same house is $850K.


Those so called pessimistic investors are actual rational investors. They realize that interest rates at historical lows, local and foreign speculation have driven this exponential rise in housing prices to the point where they are huge multiples of the average persons wages.
You suggest that these returns over the past several decades will continue while anyone who looks deeper realizes that to continue on that path housing prices as a multiple of income would have to continue to rise.
Your bachelor doubled in value in 6 years. I wouldnt expect it to be worth $1.2 mill in 2025.............

I simply called bs on what you said in a post, and reality.
It was my parents generation when the mom usually stayed home, dads were the "bread winners". My mom didn't work a day after I was born.
I entered the workforce in 73, straight out of high school. So did all the girls, or ~99%.
Now. Think for a minute........ ......... .........
In 73, do you think there were no similar conversations regarding house prices? (sans internet)
When a 'for sale' sign went up on a house in the hood back then, the talk was "It's impossible for the price of homes to go any higher".
Same has been said nearly EVERY DAY since.

 

[ChrisCBR]

I simply called bs on what you said in a post, and reality.
It was my parents generation when the mom usually stayed home, dads were the "bread winners". My mom didn't work a day after I was born.
I entered the workforce in 73, straight out of high school. So did all the girls, or ~99%.
Now. Think for a minute........ ......... .........
In 73, do you think there were no similar conversations regarding house prices? (sans internet)
When a 'for sale' sign went up on a house in the hood back then, the talk was "It's impossible for the price of homes to go any higher".
Same has been said nearly EVERY DAY since.

I didnt say woman didnt work at all in the early 80s but they worked at significantly less rates. 99%, lol nope

You still havent acknowledged that when you bought your house, its price was basically the exact same as what a median household income was for 1 single year and now it is a multiple of 10!

In 1973 you could buy a house in Toronto for 30K and only 45% of woman worked.....

 

[Hack]

Attitudes towards home ownership have changed too...
I think many younger folks have decide they'll never be able to afford to buy so... they rent, or... Stay at home with mom and dad for as long as they can.
The 20-somethings in my field start out making about $75k a year... You know what they spend it on?
Cars and travel...
I cant say I begrudge them that... Lol.

 

[TwistedKestrel]

We gotta make a rule for these threads that you need to back up affordability statements with a full budget

 

[meme]

Nonsense. Young people do work and they pay for school.
Funnily enough, most of the people I know who bought in the past several years barely worked when they were younger, didnt work when in school, lived at home rent free until they hit 30, never payed for food and had their parents pay for their whole education. They got jobs, had no education debt and their parents fronted the money for down payments.

I don't see it. Sorry. If they do work where the hell is all that money going to?

I see 20 year olds in grocery stores and coffee shops, not teens UNLESS you are in a small town. I don't have kids but out of the 8 close co-workers I have they have 15 kids between them (13-19). Not one has a job. Not one has a penny saved for school. All the parents are expecting to pay. Some are saying past retirement to fund this.

Not nonsense at all.

 

[Gary]

I didnt say woman didnt work at all in the early 80s but they worked at significantly less rates. 99%, lol nope

You still havent acknowledged that when you bought your house, its price was basically the exact same as what a median household income was for 1 single year and now it is a multiple of 10!

In 1973 you could buy a house in Toronto for 30K and only 45% of woman worked.....

That's a pretty chart, but it doesn't reflect on the world I grew up in.
I apologize. I don't understand what I'm supposed to acknowledge.
We both worked. In different unionized factories. Both making decent dough.
Women started working on the line at ford in the 70's.
All the girls from my youth had jobs. So did the guys. We all worked in the 70's. The chart might be from Kentucky, I don't know.
A couple with equivalent jobs as we had in the 70's could certainly afford to buy a house today. (without 2 brand new audi / lexus etc, etc)

 

[ChrisCBR]

That's a pretty chart, but it doesn't reflect on the world I grew up in.
I apologize. I don't understand what I'm supposed to acknowledge.
We both worked. In different unionized factories. Both making decent dough.
Women started working on the line at ford in the 70's.
All the girls from my youth had jobs. So did the guys. We all worked in the 70's. The chart might be from Kentucky, I don't know.
A couple with equivalent jobs as we had in the 70's could certainly afford to buy a house today. (without 2 brand new audi / lexus etc, etc)

Its taken from here:
The surge of women in the workforce

Yeah Im sure statscan "doesnt reflect the world I grew up in"

 

[Gary]

Its taken from here:
The surge of women in the workforce

Yeah Im sure statscan "doesnt reflect the world I grew up in"

Again. Pretty chart.
City life vrs non city life. Break that down.

Anyway.....back to housing cost(s).
Living room blind just broke.
More expense. Damn.

 

[BB722]

The trend above will likely continue until the planet is on fire, imo.

Lol sure seems like it

 

[nobbie48]

You can't own a GTA house on 2x minimum wage... you never could.

If you have 2 people making min wage, that's $56K/year paying $1700/mo you could only save $2000/year toward a down payment. Doesn't work out.

Think like an immigrant.

Move in with family or friends or have them move in with you. You don't have to spend $1700/mo.

Buy a ton of rice or pasta in bulk when it's on sale. Potatoes rot.

In the evenings either work another job or take courses to get a better one. Therefore you won't need cable.

Don't own a car. Walk, transit, or bicycle.

Don't own a lot of stuff and learn to fix what you own.

Never go out to eat. The exception is to buy a small coffee to take advantage of free internet. Better still go to the library.

I'm talking long term ownership. A lot of immigrants did the above finally paying off the house late in life as their kids graduated from university. Their kids won't be working for minimum wages.

My wife commented to a Chinese friend about leaving an inheritance for the children. The Chinese lady said their inheritance was for the grandchildren. Think dynasty. Wall Street has brainwashed the west into the have it now syndrome.

Discussing frugality on a forum where one must have many thousands to enjoy their toys is silly.

Watch "The Good Earth". It has a recipe for dirt soup. Draw your own lines when it comes to kids.

 

[Mad Mike]

Your rebuttal to my argument in the other thread was "stop the bs". Then we find out you bought your house for $32K in 1983, when median household income was $31K. You bought your house for almost the equivalent of 1 years worth of median household income and your throwing mud at people claiming its not harder today. Thats the equivalent of being able to buy a house for $89K today when that same house is $850K.

Not exactly. In 83 debt service costs were as high as 18% per annum. A comparison of capital costs on a highly leveraged investment means nothing without computing debt service costs.

Also, in 83 the Hammer was not part of the GTA, it was dumpier then and struggling with mountains surplus housing.

 

[ChrisCBR]

Think like an immigrant.

Move in with family or friends or have them move in with you. You don't have to spend $1700/mo.

Buy a ton of rice or pasta in bulk when it's on sale. Potatoes rot.

In the evenings either work another job or take courses to get a better one. Therefore you won't need cable.

Don't own a car. Walk, transit, or bicycle.

Don't own a lot of stuff and learn to fix what you own.

Never go out to eat. The exception is to buy a small coffee to take advantage of free internet. Better still go to the library.

I'm talking long term ownership. A lot of immigrants did the above finally paying off the house late in life as their kids graduated from university. Their kids won't be working for minimum wages.

My wife commented to a Chinese friend about leaving an inheritance for the children. The Chinese lady said their inheritance was for the grandchildren. Think dynasty. Wall Street has brainwashed the west into the have it now syndrome.

Discussing frugality on a forum where one must have many thousands to enjoy their toys is silly.

Watch "The Good Earth". It has a recipe for dirt soup. Draw your own lines when it comes to kids.

Thats how you think modern day immigrants live? Some in the past did but that was the exception not the rule.
The europeans that came here in the 50s and 60s certainly didnt live that kind of life. None of the woman even worked back then

 

[Wingboy]

Thats how you think modern day immigrants live? Some in the past did but that was the exception not the rule.
The europeans that came here in the 50s and 60s certainly didnt live that kind of life. None of the woman even worked back then

What do you call raising 4 or 5 kids...a hobby?