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Condo Advice (pg. 6)
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| 1dawoman |
| quote: | Originally posted by MarkT
"renting vs buying" and "condo vs. house" are topics on their own...suffice to say that some of the info here is misleading. rent is a tax credit and only reduces tax payable for relatively low income earners. IIRC, my provincial tax credits were consistently nil every year that I rented. my rent paid made zero difference.
IMHO, I wouldn't consider a primary residence (condo or house) as an 'investment' in the traditional sense. it's not that you won't see it gain/lose market value, or that it's not preferable to see your property appreciate vs. depreciate, but that it's not the same as buying stock at x price and selling at y.
obviously, a gain/loss is only realized when you sell. until then, it's a paper gain/loss. with a primary residence, it's not only unrealized until you sell, but unrealized until you sell and if you either exit the market entirely or buy again in another market that didn't experience the same level of appreciation.
Aaron gave a lot of good examples of what can be involved with a new construction. it can indeed be stressful and you need to determine if you can live with the potential drama in exchange for the pros that come with a brand new home that you were able to customize somewhat and be the first to occupy. there are clear benefits to be enjoyed.
one thing I would add is the builders can even make changes to room dimensions, if necessary. in theory, your 12x 10 bedroom could actually turn out to be 11 x 10 due to some unforeseen engineering/build requirement and you're outta luck with pretty much zero recourse. unusual? sure. but remember that you're buying a floorplan (that can change) with materials/finishes (that can change) with a tentative closing date (that WILL change, lol). new home warranty programs have less teeth than they ought to...so don't take too much solace in them either.
regarding appreciation, keep in mind though that most existing properties in the same market had similarly appreciated over the same time period of time too. whether you took possession then on an existing property or took position later on a new build is irrelevant in that regard. the more relevant stat might be whether new constructions prices appreciated to a greater extent than an equivalent resale property over that same time period.
what a new build does allow you to do is have your price set long before you have to incur the full expense required to acquire and maintain the asset. i.e. it eliminates the risk of price increases in the interim. but that is *not* to be confused with eliminating price risk, period...as an increase in value is not guaranteed. in theory, prices could have plateaued or even dropped in the interim (and in fact, that IS what happened in several areas of the country recently). you simply can't say with certainty where the market will be 2-3 years from now...though at the present time, it's quite reasonable to assume that Toronto home prices will continue to appreciate for the foreseeable future. still...there is risk.
a new construction also subjects you to mortgage interest rate risk. you know what mortgage rates are today if you close on a purchase now, but you do not know what they will be in 2-3 years when a new condo is built. virtually no mortgage lender will guarantee a rate beyond 12 months and the longest rate guarantee typically provided for current 'top' rates is anywhere from 30-120 days. with rates still at a relative low point and the likelihood is that they will be higher in the coming years, you're definitely taking on interest rate risk with a new construction vs closing on something now.
something that recently impacted people who took possession last year vs. a buying a condo that will closing years from now...the introduction of Toronto's municipal land transfer tax. previously, there was just the provincial LTT, but now there are both. thank you David f'n Miller.
what will impact people going forward if they choose a new construction vs buying now? HST (yes, there are thresholds, but it will still impact a significant portion of buyers in Toronto.
point ultimately being...you're taking on more than just the risk of 'drama' on inconvenience with a new build. |
do you work as a financial advisor? If yes, can I be your client? |
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| dEsidEL |
| quote: | Originally posted by Pett
have you locked in yet?
I'm still riding it out for now, but thinking it might be time soon |
www.primerate.ca |
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| exstasie |
| quote: | Originally posted by Man_Devil
F_ck thats expensive! Yeah the TTC sucks but that would give you an extra $900 per month!
I can't see myself buying a car until I absolutely need one! |
Not to mention Zip Car/Auto Share are available when Needed.
I'm moving into a condo that I purchased relatively soon and I've factored that it's going to be cheaper living in the condo with my Mortgage + maintenance fees then what I currently Pay:
~ Imaginary Rent
~ Car + Gas/Maintenance
~ GO Train Pass
~ Gym Membership
Those 4 things combined are $250-$300 more a month then what I'm predicting to spend when living in the condo.
I think a lot of it has to do with what fits in your lifestyle and what you're accustomed to.
I've never lived in an old house. Growing up we always bought new houses as that is what my family preferred. I personally can't see myself buying used, but that's just want use to.
I'm hoping that there aren't any major issues with the condo, but if there is, i'm blaming it all on VDUB!!! :D
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| smuncky |
| quote: | Originally posted by exstasie
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I'm hoping that there aren't any major issues with the condo, but if there is, i'm blaming it all on VDUB!!! :D
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structural wall failure |
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| Shaya007 |
| quote: | [i][b] i'm blaming it all on VDUB!!! :D
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:haha: |
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| exstasie |
| quote: | Originally posted by Shaya007
:haha: |
Funny thing VDub actually built my Condo! lol
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| Shaya007 |
| quote: | Originally posted by exstasie
Funny thing VDub actually built my Condo! lol
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uh.oh! |
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| exstasie |
| quote: | Originally posted by Shaya007
uh.oh! |
I know. When I found out I got quite scared haha
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| VDub |
| quote: | Originally posted by exstasie
I know. When I found out I got quite scared haha
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I poured your walls on the Monday following my bday/The Gift last year...
I probably should've called in sick.....
:nervous: :nervous: :nervous: :nervous: :nervous: |
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| Swamper |
| There are probably old glowsticks and vapo rub bottles hiding behind that drywall |
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| exstasie |
...i think i'm going to have to inspect these walls once I move in.
Thank goodness you didn't install the drywall. i'm scared to know what I might find behind those walls! |
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| Pett |
| quote: | Originally posted by MarkT
...but IIRC, you have a discounted rate too, don't you? I have 2.5 yrs left at 'Prime minus 1.00%' \ |
yea mines prime minus .9 with 3 years left, I was thinking i could negotiate a better fixed rate because of that position but If you haven't mentioned it I'm guessing its not even possible. |
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