Royce McCutcheon [at VREAA 20 Jan 2011 11:44am] has some wise advice for those caught on the wrong side of the bubble – “Make a choice NOW. Don’t hedge. Don’t wait till the end of this year. Ask yourself: how much sleep have I lost over this issue? How many fights have I had with my partner? How much stress have I carried with me because of this? How much WORSE will my obsession with this issue be as I consider the implications of having an expanded family?
The day I embraced the fact that I would be in the Lower Mainland for at least the next several years – and I realized that I was completely fine with the idea that I might rent that whole time – was a GREAT one. It removed some seriously pointless baggage. Life can’t be lived waiting for things to happen – and while I truly believe things here are going to correct soon, I can’t tell for certain if we’ll see it start this Spring or a few years out – or if I’m flat out wrong. Do you want to worry about how this issue is going to affect your life for that long? A terrible thought.
So do the pro/con calculations with your partner TODAY, ruminate, and make a CHOICE. Choose to stay for a longer time line (like several years) or choose to move soon and start building your new life ASAP. You don’t have to carve it in stone, but at least put it on the wall with some fairly permanent ink. The funny thing is that there’s a decent chance you’ll be happier either way.
Make a call together and then stick with it.
And as a post-script: nothing says you can’t stay engaged on this issue from an intellectual standpoint. I’ve actually found it to be much more interesting once I stopped considering it so much vis-à-vis my own life.”
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Thanks to my incessant evangelizing about the true nature of real estate markets and the true costs of home ownership, my SO has come round to not caring whether we rent forever (despite her annoyance!). We did the math and realised how much higher our standard of living and retirement savings will be. This was a big transformation.
Moreover, after I read Royce’s original post, she and I decided to commit to a two year period at our current rental, and review our options in 2013. This has greatly simplified decisions vis-a-vis the kids’ schools, my education, etc. and has removed the daily doubts and anxieties inherent in living with uncertainty.
Thanks for the well-worded and profound advice, Royce! It came at the right time.
Now if i could just stop being fixated on the housing market… it moves soooo damn slowly, but I just can’t tear myself away… waiting for 11,000 inventory anytime soon… who knew watching a process SLOWER than paint drying could be so fascinating. VREAA, once this RE thing is done, set up a blog on tectonic plate movements… I’ll gladly lurk there too, waiting for the odd quake every 11,000 years or so…
If it helps.
I read an piece last year on the perception of pain. Namely: Is it better to pull the bandaid off quickly or do it slowly? A lot of people seem to think (when someone else needs to get it off) to do it quickly is the preferred method, basically, get it done. Not so apparently to the boffins who claim that after extensive research, even brainscans, the conclusion is that doing it slowly is much less painful to most people.
Now, apply this to the RE market and I guess we should hope for a 30 year unwind, I doubt we’ll be THAT lucky.
hehe. Nice analogy. I always peeled them off sloooooowly. Here I find myself wishing for as rapid a crash as possible, so severe that it destroys peoples’ misplaced faith in real estate for three generations. Then we can actually grow a decent economy like the germans, swiss, and whoever else realises how damaging asset price volatility is when it is allowed to interfere with the basic human need for shelter.
I think many people in Vancouver see renting as some bad stigma or something, but you know what, renting can be beneficial: it is much cheaper than the current market, usually have heat/electricity included, NO condo fees!!, no maintenance!!, no leaky condo fixes!!. It can be more stress-free if you have a good building etc. Anybody know any stats on % of people who rent in vancouver vs owning?
We believe that the percentage of renters vary by sub-sectors of the city, from 30% (suburbs) to 50% (some downtown areas).
Nationally the fraction of owners is 70%; less for Vancouver.
Yes, I never understand people who dis renters. In Europe people often rent their whole lives. Germany has one of the highest rates of renters and yet one of the best economies. Go figure. I have owned (about 10 years, including 4 living in my own place) and rented (about 12 years, including the last 6). I still own in fact – just not in this country.
I can safely say that my standard of living and lifestyle was no different as a renter than an owner. In fact, because as an owner I could repaint and renovate whenever I wanted, and because I had to fill my own place with furniture, owning has always been much more expensive on a monthly basis than renting for me. You just seem to feel the need to buy more stuff when you own.
I also happen to be a good saver which makes renting a double win right now. And I also take looking for a rental place as seriously as looking for a place to buy. So maybe that’s why for me renting works out just fine and currently I live in a place that is not only cheaper to rent than own but is also in a better area than I could afford to buy in right now.
Like the original poster if I have to rent for the rest of my life in vancouver I don’t have a problem with that, and I’m speaking as someone who could sell my property abroad (bought in my home country before prices went crazy there luckily and so with a tidy profit tied up in it) tomorrow and have about a $200,000 downpayment. Even with that and a two-income household, I’d consider myself crazy to buy now in Vancouver. Rent for 30 years, enjoy life, invest wisely and buy outright when you retire or buy now and spend 30 years worrying about interest rates? Not a tough choice for me…
I think much of it is done by the renters to themselves. Many place such a high premium on ownership, that they begin to wonder what is wrong with themselves if they cannot buy in late into the bull market. Speaking for myself here… but now… thanks to the wonder that is the free flow of information facilitated by hard working individuals like those behind VREAA, the very concept of home ownership seems toxic to me. I doubt I will buy even if prices collapse. Looking up at the roof here, and its old cedar shingles with moss… due to leak annnny time now…
“I can safely say that my standard of living and lifestyle was no different as a renter than an owner.”
yes, and here that lifestyle and standard of living are far higher as renters. My house now is worth close to 1m. Crazy. when I was young, a million was an undreamably vast quantity of money. And damn if it still isn’t; it will buy you four Ferraris.