“Our landlord subsidized our housing costs to the tune of $200,000 cumulative over 5 years.”

“I left Vancouver. Lived in the same amazing apartment for 5 years while dear Landlord subsidized our housing costs to the tune of $200,000 cumulative over 5 years. After 5 years of no rent increase, you would think that on leaving they would be ready to raise it !!!!
Wrong – – – –
Rent is down 8.5% on a nominal basis, 20% on inflation adjusted bases and if you are taking out strata/taxes, rent is down even more!!!
I would so love to go back to it – but now at that price point there is serious inventory and competition so the landlord is being aggressive to get the vacancy time as low as possible.
Did we throw money away on rent? No !! We lived it up, had a great place, and saved $200,000 compared to the cost of owning.”

yvr2zrh at VCI January 19th, 2013 at 1:03 am

21 responses to ““Our landlord subsidized our housing costs to the tune of $200,000 cumulative over 5 years.”

  1. An interesting perspective on “saved”.

    • I found that interesting too. I was thinking of buying a new Porsche but didn’t so I just saved $90,000.00. I understand what the writer is getting at. However, using a term liked “lived it up” makes me think that they maybe invested in overpriced dinners and micro brews!

    • I think the meaning is perfectly clear unless you are being deliberately obtuse. In the context ‘saved’ means ‘spent $200K less by renting vs owning’.

      And to put it in terms Diggstown will understand, I was thinking of buying a new Porsche for $90K but found one at another dealership for $80K thereby saving myself $10K.

      • I saved way more by not paying for something I didn’t need. If this commenter needed that space regardless the cost then he did indeed “save” money. Otherwise it’s a frivolous comparison as he never would have bought it anyways.

    • Saved in that that condo or house probably cost money to maintain. It costs money in that your money is tied up on the down payment. And it costs money if it goes down in value.

  2. Rented a couple of places since selling a few years back. Recently been comparing west side condo rents with assessments. Based upon that most prices are 30%-50% over rents, at least in our price range.

  3. Stop throwing your money away and rent!

    • The Poster Formerly Known As Anonymous

      I know you meant “pfffft!”. But for some reason I keep thinking of it as “pssst!” with a lisp, and then chuckling to myself.

  4. Renting has worked out beautifully for us. My capital is not tied up in a single non-liquid asset. Instead it’s working for me invested in other assets. If my job situation changes, I can move on a whim. We are 10 minute walk away from my child’s school and my condo comes with full amenities. We had a rent DECREASE in 2009 and it has stayed at the same level for the past 4 years. We will buy again one day, but at a level that’s acceptable to me. I can stay liquid longer than the market can stay rational.

  5. I meant irrational

    • The market is always irrational, so unless you can live to infinity, I say – not!

      • I won’t live to infinity, but I am prepared to rent until the day it makes sense not to. I have enough assets growing elsewhere that I don’t need to rely on owning a place to live/retire. Most friends I know who own end up spending their weekends at Home Depot. No thanks.

  6. I am the OP but there are some facts missing in this extract. The unit was a $1.5 million sub penthouse. Strata and taxes were over $1,000 per month. 270 degree views of mountains / eng bay, granville island. Brand new unit (so brand new, we took posession from builder and when owner came to inpsect for the first time after 4 years -they did not even know it was built with hardwood). Rent was $3,500 per month. Cost of ownership of this unit would have reached $7,000. So – – at $40K per year savings of renting over owning, we were $200,000 ahead then had we owned. This ultimately was a pretty good amount of the money we saved (and thus the equity we built) while living in Vancouver for 5 years. Sorry Real Estate industry – your math is flawed big time.

  7. It would be an interesting calculation to compare renting over purchasing during that same 5 year period, beginning in 2008 and selling in 2012.

  8. theboywhocriedbubble

    http://tinyurl.com/bjsmrbl

    allen : try that link , it should give you a ballpark based on what variables are available.

  9. Hey here’s an anecdote, I just bought a new car and financed it. Who cares about buy vs lease, new vs old, all the desperate realtor bmw’s coming up etc. I just decided for my own irrational reasons I wanted a new car. What is interesting is that I can buy the car for cash however the dealer isn’t offering any discount fora cash deal – non negotiable (did the walk away all that, no dice). The dealer actually prefers me to finance….at 0.9% for 5 years!!! WTF? I can earn more than 2% guaranteed and can do much better with some risk….are dealers that desperate for a steady cash flow?

    • Depends on the dealership. Japanese auto dealerships seem to want you to go the financing route with the expectation for a weakening Yen perhaps? The big 3 seem to be a bit more cash motivated though.

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