Announcer: “Susie Shin is looking for a place to call home. The 33 year old moved to Vancouver from Toronto. She works downtown and would like to live nearby. But Shin knows in this city her money isn’t going very far.”
Susie Shin: “I’ve been working for awhile, I’m a professional, I figure at this age I should be able to afford a decent place downtown, but in Vancouver it’s a bit tough.”
Realtor: “So this is a one bedroom and den…”
Tanja Beja, Voice Over: “On Shin’s wish-list, about 700sqft, and a view. Her budget of $400K won’t get her both. But Shin isn’t spending a penny more: she’s a financial planner, and she’s calculated what she can afford, something her realtors says young buyers don’t do often enough.”
Shin: “I expected the Vancouver market to be really tough to get into, compared to Toronto… the reality is hitting me a little bit harder, you know, that I may need to rent for a little while I earn more money to get a bigger downpayment on a property.”
Tanya Beja: “So, for now, the house hunt in an overheated market continues.”
- Anecdote extracted from ‘Generation How?’ clip on Global TV, 4 Oct 2011 (3:00 onwards). [Thanks to Greenhorn, for the video archive]
It doesn’t look like this prospective buyer is anticipating any price pullback.
She is putting off buying in part out of being sensible (she has set a hard ceiling on what she can afford).
Her unplanned and forced delay, to save for a “bigger downpayment”, will likely, by complete chance, work in her favour.
It’ll be very interesting to see how buyers such as Ms Shin behave when prices drop by 10% or 15% or 20%. Will they jump in, or will they start questioning the wisdom of overextending themselves to buy what will still be very expensive RE? – vreaa