Fwiw, I'd still prefer living on the west coast of Canada than an overwhelming majority of other places like the U.K or U.S, even despite literally not having a job, any prospects, or the possibility of owning a home at any point in my life, even as a software developer. If I left, and it's possible, it would be because all of those factors got to a point where I had no choice.
You can get a 3 bedroom townhouse with a garage and a small yard 45 minutes from Vancouver for 900k. Is that really unachievable? Split it with a partner or a friend, rent out the 3rd room for $1k a month, and you need to save 90k for the Downpayment and the mortgage is 5k a month minus the rent, so you need to chip in $2000 a month to the mortgage. Rule of thumb for accommodations to be less than 30% of your income so your income is 6,666/mo or 80000 a year, or $41/hr.
Any tradesperson can make that. People are charging $45/hr to clean air bnbs.
Generally I approve of this type of thinking, it's how I got my start, too. So I'm only quibbling to improve the fidelity of the model for those who are like us.
1) My impression is that it's prettttty tough to get those 10% down mortgages these days. Though, again, that's behind me now, I could be wrong.
2) The bank will not consider your accom to be mortgage-minus-sublet-rent for the stress test, I promise you. They'll count your rent as additional income, at some discount (fuck you, bank), and then count 30% of that against your mortgage payment (for the stress test). I guess if you know someone who actually got this past the bank stress test then let us know, and let us know which bank, because I'll move the next time my mortgage comes up. But I have tried in the past. So you'd need a joint income of 200k (I trusted your estimate of mortgage at present rates on $810k), minus 10k/a for the rent, is $95k each, $46/h.
Still. Although it is definitely difficult, it is, as you say doable.
I meant brailsafe’s share of the down payment is 90k, and brailsafe’s partner would also have to come up with 90k. 20% down. Agree 10% down is not plan A.
Also agree on the banks being difficult to work with on including the future rental income when qualifying.
It sucks if you are a single person - probably have to go apartment route or 1 bedroom condo. The most successful guy I know, who has a pretty sick motor yacht now, had a room mate until his now wife moved in.
Right, okay. And, to be clear, back in my day 5% down (FIVE) was totally plan A, so that has gotten harder for the next generation. Thanks, fedgov!
> difficult to work with
Heh, notwithstanding the amusing savagery of my sibling comment, is "difficult to work with" a euphemism for "impossible to work with", or do you have reason to believe that this is even possible?
> It sucks if you are a single person
I would say that it's getting closer to hopeless if you're a single-income family, and being a single-income individual isn't much better, because 1br condos are actually not that much cheaper than 1br.
I'm in a condo, btw, and I could have done it on my income alone when I bought (laxer stress tests, I provided the down solo anyway, rates were lower, prices were lower), but I could not buy this condo solo today, and certainly not with the income I had then.
I guess my overall message is: I think that the type of financial modelling you were doing is excellent to show that it is not yet impossible or hopeless, and if someone wants to make it happen, it's still within reach... but... it's genuinely really hard. For decades I've been scoffing at people whining about affordability, saying that they just spend too much on short-term pleasures, but in the last decade I've kinda stopped the scoffing and shut my mouth.
The math for a 1 bedroom condo in the 20 min from downtown (not that it's relevant to my lifestyle) works out to about $5k a month if I had a clean income history and a 20% downpayment. It's just not an amount I could see my partner and I being able to absorb, nor would it be worth it if we could. It's unfortunate, because we've lived in our already relatively expensive studio basement suite for 4 years. Shit is cray out there.
I mean, I guarantee you can do better than that. The condos you describe certainly exist, but there are other options. Maybe 2 bedrooms for $3k isn't enough of a difference for you to care about, though.
And you don't need a "clean income history", that's not a real thing. You need all the people on the mortgage to have a stable job, typically 6 months. If your source of income is more variable/complicated, they'll ask for 2 years of tax returns.
This kind of doomerism is why I wanted to support applied_heat's post in the first place.
I don't really think 2 bedrooms for $3k, in Metro Vancouver would be a likely find. I'd say even if you're willing to sacrifice literally every other characteristic, but usually if you're in that range now you're looking at very high condo fees or something like no laundry in building.
But again, if space is literally all you're after, and you might be for all sorts of perfectly valid reasons, then that might be your choice. On the flipside, it would be weird for us to work relentless and double or more likely triple our monthly expenditure while basically getting only marginal or specious value for that money.
For example, even if the numbers or stability on our end made sense, and committing to that wild increase in cost didn't increase our exposure dramatically, we'd still be trading triple our shelter expenses for the added utility of basically one room and the power to knock out a wall or something.
No matter how you spin it, without a huge pool of cash and unrealistically high income(s), or a bunch of people subsidizing your mortgage, it's not impossible but generally not a sensible move unless you absolutely must own something for some reason.
I can theoretically earn above $100k, but it doesn't really matter unless that's sustained for a long time with few breaks, and that's not happening enough to bet on, such that I'd take out a mortgage expecting that income to be there long-term.
I'm not sure it's doomerism, as in, I wasn't saying things were "hopeless", just unrealistically demanding to attempt pursuit of what used to be considered a standard gradual path of upward growth. I live where I do despite that, and basically will until it's not feasible to do at all, along the way we'll have to face some seriously tricky choices anyway unless we can find someone else's basement to live in till at least our mid-thirties.
I think mortgage brokers were a bit more flexible than the big banks at recognizing future rental income, especially if you already had one property generating some rental income indicating you would probably make it work again.
For the first property I agree you would need to qualify without taking the rental income in to account.
This part is a problem, because it sounds like 45 minutes to where the traffic starts, from there another 1.5 hrs to the parts of the city you want to go.
Just because some configuration of variables could hypothetically come together in the right order over some long-enough period of perfect stability if me and my partner relentlessly pursued just that specific goal, which I don't have, for years, doesn't make it a sensible idea to do so, and I didn't say it was hopeless; just kind of a worthless and unlikely pursuit.
However, I definitely should have been more narrow with my specification of West Coast. I like where I currently live, and have no plans to move, and have no plans to work myself into the dust in arbitrary jobs to afford a type of house that I don't want, somewhere I don't care to live, possibly dependant on a car I also don't want. If someone gave me the house you describe, I'd rent out the whole thing and continue renting where I am.
Ideally I'd shoot for a 1 or 2 bedroom condo in a more central area, but the math does not work out in a way that makes any sense to me, in part for the other reasons I cited in the original comment.
It's pretty common for people to come out of the woodwork when affordability or job concerns are raised to just imagine a series of variables whereby if you just keep dividing the space, adding jobs, and moving further out, there's no problem, because theoretically you can still pay for something regardless of how much or how far or how many other people you share it with.
I'd rather disagree with the premise, and spend my time and energy elsewhere instead of on some mcmansion in Langley for an amount of money it shouldn't be worth.
It's also rude to denigrate people who clean Airbnbs for $45/hr (which isn't enough) as if it's not a skill and anyone can just switch to it. It is a skill, and I don't have that skill, or the equipment, or any of the other stuff someone would require to get operating as a business which they'd need to be. Likewise tradespeople, which software developers clearly are in some ways.
The facts are that the Canadian software development market is terrible, job volatility is higher than it's been in quite a while, and housing of all kinds is higher than it's ever been all over the country. Those are not promising conditions for prosperity.
I didn’t mean to denigrate cleaners, I have friends who clean air bnbs and they are charging more than $45/hr, I just saw that advertised. Anybody can pick up $50 worth of cleaning products and start scrubbing without any special education or training so we might disagree on how much skill is required, but my Airbnb cleaning friends definitely have motivation, and a positive attitude and outlook on life despite the challenges they face in other areas.
Either you rent for your whole life or you buy something and have to compromise on some of the variables. I see lots of people working hard, mostly in jobs they don’t love, and making those compromises and choosing to buy somewhere.
> despite literally not having a job, any prospects, or the possibility of owning a home at any point in my life, even as a software developer
I hope things turn around for you! I meant to point out that home ownership is possible, but it sounds like you have already evaluated the variables and if you are set on only living in some specific area then home ownership might not be possible in that location without a couple of well above average incomes.
I do think the mission of buying a house in an arbitrary place is kind of a misguided gen-x goal unless you have a legitimate space constraint like kids, already have a car as key component of your life, or have no established community. My point was that it's not worth relentlessly pursuing home ownership in some place just because it seems like inherently sensible goal. To acquire a house I'd need an improbable set of other variables to align, or relentlessly pursue it at all costs, and it's just so expensive for such a marginal and specious gain, that I don't think I'll concern myself with not having, whereas a few years ago it was merely a choice to keep renting and the delta between the two ongoing expenses wasn't like 3x.
Seems like you just picked an arbitrary and astronomical threshold, zoomed in somewhere that seemed vaguely close to Vancouver from the sky, and made your argument based on that. Parent was entirely correct in posing their question, because 45min from X is a giveaway.
Squamish is a wonderful small town up the coast; a haven for climbers and outdoors people. Not many people have the intention of moving there—it's quite isolated—but even still, that attached townhouse has more than doubled in value since it's last sale in 2007, probably the majority of which came in the last 5 years.
