Looking for a house in BC (Fraser Valley) - Half a million for what???
 

Okay - so it has come time to stop renting and look for a house. We're going in somewhere with my inlaws, so there are a few requirements - primarily a suite (full with a decent sized kitchen)

now - I know we're asking a lot, but for pete's sake, we've been looking for on about a month now, with NO LUCK. We're sitting here looking at properties that are barely over 2200 square feet and 7000 sq ft lots, that push the 500k mark.

I thought only mansions were supposed to cost HALF A MILLION DOLLARS?

Sigh - Anyway, I know there are a lot of times properties that sell straight away before even getting exposure on MLS, so I'm wondering if maybe a professionaly minded group here might have some info or leads :)

Basically we're looking for:

- 5+ bedrooms
- Suite downstairs (read: another kitchen, as long as it's big and mostly finished, without needing to put in tons of plumbing, etc and 2 or more bedrooms
- somewhere in Langley, Aldergrove, Cloverdale/Fleetwood - etc.

I know it's a long shot, but I figure what the heck, give it a shot. Thanks in advance :)

Good luck, Nick!

If it makes you feel any better, the 1150 square foot apartment that I rent here in Calgary is worth $425,000. The market here is ABSURD!

Log house - 1350sf - guest cottage - 30 acres - lots of big trees for privacy - bit of a commute but only $325,000!
Such a deal I have for you :mrgreen: :mrgreen:

Wait a couple of years until the real estate bubble crashes.

The overinflated prices make sense in West Vancouver or the west side of Vancouver. The prices do not make sense out in the valley where there is an endless supply of land.

For now it makes more sense to rent than to buy. That alone should tell people that real estate prices are out of line with reality.

Our concern here is that it's not going to crash for at least another 10 years, look at what happened after expo 86, and with the 2010 olympics, it's going to drive more people here - well, at least that's what investors see.

I figure if we can find a place for the mid to high 400k in Langley (primarily brookswoood) I'll be happy. I do find it frustrating that houses which went for 325k in the Queen Mary part of Surrey are now going for 25% more on average.

As for there being unlimited amount of land in the valley, after spending the while we have searching, it ends up being broken into decent sized houses on tiny little lots. It's very frustrating.

If I continue to rent any longer, dumping 1200 a month into someone else's mortgage, I'm going to scream. I won't pay 560 for a house that's worth next to nothing, but I really wonder if paying 460 for a place on 3/4 an acre is that bad a deal?

hey Nick...good luck to you...houses here are the same thing..we bought ours (which is exactly what you are looking for but in Campbell River:lol:) for $236,000 and now less than 3 years later it is appraised at over $400,000!!! Sad, but true...we're just glad that we bought when we did~ Hopefully you will find what you are looking for!

:lol:

When did it ever make more sense to rent than buy?

When the price of property is high that cost is passed on to the tenant.

While the price of buying may be high, the cost of renting is much higher when you take into account that you have zero return on the money you put out as a renter.

If you buy at these prices and take a mortgage on the new outragous 40 year term........ You can still have a renter live in this place and make the mortgage payments for you.

Too many people have missed the chance to become a home owner while waiting for the next crash IMO.:biggrin:

Stay away from a 40 yr mortgage... you'll never pay the principal off. Payments might be a little cheaper, but that's FIFTEEN more years. Just my 2 cents!!

See, that's what I was thinking I wanted to say ;)

I got scared away from the market when we sold our Condo a few years back for a loss of about 25%

Thing is, had we not owned, we would have been throwing that money down the toilet to a rental. Six of one, half dozen of the other, I guess.

I can't risk being afraid again, if I do - I may never own, there may never be a home for our girls.

And like Lex Luthor's father said, the future is in land ;)

Bi-Weekly payments!! :)

And we can always refinance once we're doing a bit better. It's not the best option, but if it's that or NOT owning (due to the debt ratio, etc.) - I'd rather own :(

I second, stay away. I did a some quick calculations on MLS.
$450,000 over 25 years@6.0=$2879/mon $863700 total paid
$450,000 over 40 years@6.0=$2452/mon $1,176,960 total paid SCARRY!!!!!
Shaun

I live out in the valley. They stopped making land out here a few billion years ago.:D

Hey Gigy, I dont know how old you and if you have ever experienced the vagaries of the market ??
I am an oldie and have owned houses for most of my adult life and own my present home outright but I have been through times especially here on the island when a house was anything BUT an investment ,through most of the eighties . I bought a house for $125,000 and sold it two years later for $95,000 after spending abot $ 25,000 on it , plus two years mortgage ,plus real estate fee's , plus lawyers fee's . This was also true of the Ontario market where people got carried away with the real estate boom and lost their shirts when it slowed down.
Presently rental costs have no where near reached their true value related to the dizzy new heights reached in the housing market .
These figures are academic if you can afford your payments and intend to stay in your new home for a long time .
The difficulties arise ,if you need to move ,the interest rates rise and the market makes a downward correction at the wrong time .
The U.S . housing market is looking very shaky.
History particularly recent history is no guarantee of the future .

Just a few thoughts ,


..............................Dave

being from b.c and posted to Edmonton and having to put up with (them)"we're are you from" (me) " Victoria B.C" (them) Ha Ha you mean Bring.Cash." Been Dealing with that for 6 years. But now with the housing market no better here and costing 3 to 4 times as much in utilities then B.C. I finally have the last laugh with them. Well kind of as Im in the same situation as you where I would like to buy, tired of giving my money to somone else when I could be putting it back into my own pocket But un able to buy with the cost being so retarded that an honest working person would put himself in poverty or not even have the means to even atempt to purchase. I dont think I'm im rich but I consider my self stable as I usually pull in 57k+ a year. I could just imagine how hard it is for the young couples trying to make it out there. Anyways dont mean to rant but I feel for you as im in the same boat and will have to wait like alot of people till the market goes down or wages and salaries catch up to living costs.

Justin

that's what happened to us and our condo.

We sold, BARELY, at just over 80. Right now, a condo 5 doors down is selling for 180.

But that's a condo market. We weren't there for good, and with a house - we WILL be there to see our kids grow up and go to school. It's not a fly by night sort of thing and I refuse to go somewhere to hang around for a few years then leave. My aprents did that, and I don't want that for my girls.

Just a thought...everyone here is paying a mortgage. Just some people are paying someone else's mortgage. If you can do the down payment, always try to buy. With the income from a suite, you shouldn't be much worse off than renting. And sure, the market may very well dip down, but it always comes back stronger. So buy a house as a long term investment and you'll be sure to see a return on it. Eventually.

Brad, You make a very relevant comment about factoring in the revenue from a suite . I have always thought this is an excellent way for a young couple to enter the market into a bigger property with the potential for subsequent larger increases in value than the small starter home , paid for with the rental income . Of course this is not for everyone with the hassle of finding suitable renters etc. and have some one living in your home .
The market does seem superheated but to some extent is only playing catch up when looking at housing prices globally.

Nick , I have four children ( all now with their own families ) and concur with you over the importance of the stability afforded your young ladies when attending school,making friends and so forth.
I wish you well in your search and , as a previous poster illustrated be a little wary of long mortgages . It is very educational to look at amortization tables and see how little the difference in payments is between say a 30 yr and 35yr term when you will be paying a whole five years more at the full ,mortage!! The witchcraft of compound interest and amortization formulae :( :(

After all ,it's only money :) :)

........................Dave

reply
 

I think the investors are correct here. The 2010 Olympics will bring to the lower main land what Oil brought to Calgary. $$$$. Get in now at any expense and you will only make money by then. Corrections in the market happen anually here in Calgary but the market always increases, only the rate of increase changes. The same rules apply out there. Good Luck!

Danny

My moto has always been Buy High, Sell low. :cry:

Good one Midnight :) :)
Just for interest and to add to the discussion, when I sold my house in England in 1982 and put the proceeds in the Bank in Canada I was getting 15/12 % interest on the deposit . In the next 18 mths mortgages reached as high as 20%. By the score people were walking away from their homes , unable to afford the increased payments.
Inflation was finally brought under control but house prices on the island did not recover substantially for over 10 years !! Wages also fell way behind , with for a long time zero increases and even reduced salaries.
Our memories tend to be short but it is only comparatively recently that we are experiencing more jobs than workers ( thank goodness ) and houses are rocketing up in price .
Hopefully our economists will continue to fine tune the economy to keep things stable and we will not return to the boom and bust scenario of a couple of decades ago.
I suppopse the best advise is not to reach too high !

Again good luck in making your choice , may the gods be with you ..........

...........................Dave.

Speaking of more jobs/workers ratio......just wondering what people's thoughts are on the aging population and how this will affect housing prices. Will empty nesters want to sell the house for a condo? Will condo prices rise because of the demand? Will house prices fall because of supply?

Thanx much,

Ah yes, I still remember walking away from an 18% mortgage in the 80's...:lol:

rental helper
 

Definitely look for a place that has an included rental suite. It's nice to have someone pay a portion of your mortgage. I bought a house in East Van five years ago for $289,000. It was a dump but I threw a fair bit of money at it and a lot of my own sweat and energy and now have a house that I couldn't afford to purchase with its new appraisal. The rental suite downstairs made all of this a viable option.

Plus when I go away, they look after my fish!!

Not sure what it's like in the Valley, but might just have to go quick. The prices for the first 3 months this year in Edm have been going up 5% EACH month.

http://ca.news.yahoo.com/s/reuters/b...using_cibc_col

On Yahoo today !

.....................Dave

I've been in the real estate market since I was 23 when I bought my first condo downtown - went half on it with my mom (was tough living with my mom again but hey, it was an investment). We sold that condo just last year for over $200k net profit. That's a $100k each... insane for _just_ a condo.

I bought a house in 2003 in port moody for $290k. I sold it in 2006 for $500k. I did put $30k into reno's.

I took the money from my house and the money from my condo and bought a newer house in port moody (parklane home) for $688k in november. Family thought I was nuts. Fully finished basement, professional landscaping done here... right across the street, a similar house just sold, except they have an unfinished basement, for $699k.

So I guess the market is still strong. I think it's going to be strong for quite some time. Why pay someone else's mortgage? Invest in yourself.... especially with long term rates so low... I locked in for 5 years and my friends think I'm nuts... I like the comfort of knowing I won't go bankrupt for at least 5 years cuz my payments won't rise.

I have a 40 year mortgage. I pay weekly and I pay 20% extra each payment. Next year, I have the option to bump that up by another 20% per payment if I want. I can also make lump sum payments of up to 20% of the original mortgage amount per year if I want. In other words, I can still pay the mortgage off quickly if I have some extra disposable income. Yet the 40 year mortgage gives me the flexibility to drop my payment amounts to a dollar value that I can cover by working at mcdonalds full time if I ever had too. Point is, shop around for a good, flexible mortgage. Who knows what curveballs life is going to throw at you... would really suck to lose your job and your home.

Other countries deal with 90 year mortgages... 40 year mortgages have been popular in the US for a long time I heard...

Don't get scared out of the market would be my advice... long term, real estate is going to keep rising... then again, don't just jump into the first house you find... so many properties out there and deals are still to be had (just have to think relative to the rest of the market, not your own preconceived idea of what housing should cost).

Now, can you find what you want in your budget? I dunno... the budget sounds a bit low to me. I mean, I live on a mountain with a 45 min drive to downtown and I paid nearly $700k for a 2400sq ft house on a pretty small lot. I've been really lucky to have a good realtor though, who has always been able to find me exactly what I want... even if it's taken a while.

If anyone is interested my girlfriends mom is a great realtor with Homelife Realty in walnut grove (langley). If any of you want to give her a call, her number is (604) 888-7424 her name is Pamela Steunenberg. Tell her that Kris Referred you and she will be able to help you out. I would recommend giving her a call she has quite a few houses around in the area and is a very nice lady to deal with.

Best of Luck
Kris

In the long run (fifty to 100 year time span) in all real estate markets the price of real estate rises with inflation. There are several reasons for this, including real estate makes up a large part of the inflation index, real estate pricing is related to incomes which are directly related to inflation, etc. This has held up long-term in all markets all of the time.

In the short run (a few years or five to ten years) the market may be far ahead of inflation like it is now, or behind inflation stagnating or even losing value for quite a few years. However if you make a graph, draw a line increasing with inflation over many years, and graph real estate prices on the same graph, the two lines will hug each other over the long term.

Factors in the short term which can make real estate prices surge include low interest rates, a speculative frenzy, a strong economy, and a net influx of people into an area. All of these factors have coincided over the past several years to create our recent classic speculative real estate bubble.

Eight or ten years ago the same thing happened with tech stocks as is happening with real estate now. Tech stocks were going to continue to go up twenty or thirty percent a year forever. Regular average people who had no knowledge or experience at investing put all their money into tech stocks. It was obvious that a crash would happen, the only question was when. And when the crash came it hit people hard. Those who had the foresight to put their money into then undervalued energy stocks did well. Of course this took the insight and courage to go against the flow, and miss out on all those "easy" gains in tech stocks.

I would caution people who have made a killing in real estate to lock in their gains, and those who are considering jumping in to buy what they can afford and what they need, rather than viewing their home as an investment that is sure to make them rich. Most likely, if home prices have appreciated faster than normal the past five or ten years, they will go up less than normal, or go down, the next five to ten years.

Anyway good luck to you all. Fortunately in my depressed area of the province our house is worth the same as when we bought it 12 years ago, I have spent maybe thirty thousand on repairs and maintenance, and our investments and economic future are not tied up in this place.

well - we'll find out today or tomorrow if we've gotten the house we want under the appropriate conditions - the mortgage company we've chosen allows for a "write-off" of the suite rental costs, but they need an appraisal done to prove that it's worth the amount we're "asking"

If not, we'll probably just pay off a big ol' loan we've got, but we'd rather not be forced into that position!

so by end of day tomorrow, we'll know for certain!

NOw it's time to prepare to move... EVERYING.

Ugh.

I agree with Trilinarmipmap.

Good luck Nick :)

..................... Dave