Home prices, etc

CrabJoe StretchPants · Jul 7, 2011

Ok

345

stoney · Jul 7, 2011

It's the same isht here. The only place where you can find good pricing on housing is if you buy an apartment complex. It is very difficult to get a loan for a larger property like that, so if you have the liquid cash you can take them down for a steep discount. But then again, you also need about $500k in cash for that type of investment... However the annuity from a large complex can be very beneficial.

Toshi · Jul 7, 2011

That price does sound ludicrous. Has Montreal not been hit with a readjustment like the rest of above-Rio Grande North America?

stoney · Jul 7, 2011

dump said:
Going that route it's as though you have to get into the housing business to get a decent price.

I know more than a few people who have bought 4-8 unit buildings with >30% down. They are all very handy individuals who do most of their repairs on their own or have on call handymen who work at good rates because of the return business.

You don't have to be in the housing business to do this, you just need to look at it as a tangible asset investment. It is something that my dad and I have been talking about intermittently. He wants to get a large complex (50+ units) for which he will need a full-time building manager. Depending on the location, factoring in all costs (including the bldg mgr), he is looking at an 8-9% annual return.

We have been debating that if this is something which, if we do it, would become my job. Because my income would come from the property and I would be living onsite, it is actually very fiscally beneficial to the overall investment.

The concept of spending that kind of coin on a single-family house currently makes very little to no sense.

Da Peach · Jul 7, 2011

Toshi said:
That price does sound ludicrous. Has Montreal not been hit with a readjustment like the rest of above-Rio Grande North America?

Seems they're just catching up with the other cities in Canada.

But that's rivaling Vancouver at that price. It must be PRIME location. Westmount? NDG?

Jozz · Jul 7, 2011

dump said:
I like the area, but not considered "prime" in Montreal. Definitely not westmount. Côte-des-Neiges.

Do you have the mls#?

Seems pretty steep for that area...

ALEXIS_DH · Jul 7, 2011

same crazy stuff seems to be happening all over the world too.
in my block, a house sold for $600,000 recently... yet montly rent on a similar house would be $2500-$3000 a month.

buy prices seem to be disproportiante to the rent prices... maybe a huge economic assplotion in the making, as prices adjust accordingly?

Da Peach · Jul 7, 2011

Jozz said:
Do you have the mls#?

Seems pretty steep for that area...

Yeah, that's surprising for a basement and ground floor. 2-car garage though... don't get many of those. Not sure it should tack $250,000 onto the price

dante · Jul 7, 2011

dump said:
Asking price, $777,000 - I thought this was for the whole building, but it's just for one of the units in the duplex - the ground floor + basement.

- Rent: $1,200/month (currently rented)

- Total annual revenue : $14,400

I really don't get it. At these prices, putting money into a home for a regular person doesn't seem to make any sense whatsoever. Maybe the people buying these homes are investors rather than people looking for a place to live.

That means that your market is WAY WAY WAY overdue for a massive correction.

http://www.nytimes.com/interactive/2010/04/20/business/20100420-rent-ratios-table.html

At ~54, that ratio is WAY above anything in the US, plus those numbers are for 2009, and home prices have fallen since then (but rent hasn't, so the ratio numbers are even smaller today).

Even at a stupidly low 4% interest rate, you'd be paying $3k per month for a mortgage if you had 20% down, and that's not including any upkeep/maintenance fees. At a more realistic 5.5% mortgage you'd be paying $4300/month.

Are there renters laws that prohibit the landlord from raising rents by more than a certain percentage? They have those in NYC, so you have little old ladies paying almost nothing for rent while living in a multi-million dollar apt, just because they've lived there for the past 50 years...

Jozz · Jul 7, 2011

dante said:
That means that your market is WAY WAY WAY overdue for a massive correction.

http://www.nytimes.com/interactive/2010/04/20/business/20100420-rent-ratios-table.html

At ~54, that ratio is WAY above anything in the US, plus those numbers are for 2009, and home prices have fallen since then (but rent hasn't, so the ratio numbers are even smaller today).

Even at a stupidly low 4% interest rate, you'd be paying $3k per month for a mortgage if you had 20% down, and that's not including any upkeep/maintenance fees. At a more realistic 5.5% mortgage you'd be paying $4300/month.

Are there renters laws that prohibit the landlord from raising rents by more than a certain percentage? They have those in NYC, so you have little old ladies paying almost nothing for rent while living in a multi-million dollar apt, just because they've lived there for the past 50 years...

Add property taxes on that $543k municipal evaluation. Dunno about taxes rate in Mtl, but that's at least another 4k a year.

You can evict a tennant with a 6 months notice to take over their appartment for major renovation or to live in it.

CBJ · Jul 7, 2011

Seems like there still are a lot of people who just want to own even if renting financially is the best solution. I know I would not buy anything in NYC right now if I had the to make the choice.

Jozz · Jul 7, 2011

dump said:
Asking price, $777,000 - I thought this was for the whole building, but it's just for one of the units in the duplex - the ground floor + basement.

It is for the entire building. The upper appartement is rented at $1200/month

http://www.remax-quebec.com/en/inscription/M/8532383.rmx?source=centris

dante · Jul 7, 2011

CBJ said:
Seems like there still are a lot of people who just want to own even if renting financially is the best solution. I know I would not buy anything in NYC right now if I had the to make the choice.

Here in Madison $1200/month gets you a 1,000-1,200 square foot house on it's own property, with a selling price of $180k-200k. We were saving ~$100/month by buying instead of renting (after downpayment, taxes, insurance, etc), and after we refi'd we're saving ~$200/month. I'm amazed that people buy in areas where it's so much cheaper to rent...

5150dhbiker · Jul 8, 2011

My parents bought the house I live in currently in 1994 for $215,000....the one across from us that is 600sq/ft smaller just sold for $980,000 and the one our size at $1,200,000....and it's just an average home. We have about a 30x15 backyard, no front yard and the house next to us looks in half our windows.

The whole thing is stupid really. My brother however, lives in Clear Lake, TX and his house that he bought 3 years ago was $250,000 3,250sq/ft and has a really nice big back yard in a nice neighborhood. So that's over 1,000sq/ft bigger then ours for about $1,000,000 less....so stupid!

I need to move out soon but even renting a room in a crappy part of where I live is at least $700/month...for a room in somebody's house.

Ciaran · Jul 8, 2011

5150dhbiker said:
My parents bought the house I live in currently in 1994 for $215,000....the one across from us that is 600sq/ft smaller just sold for $980,000 and the one our size at $1,200,000....and it's just an average home. We have about a 30x15 backyard, no front yard and the house next to us looks in half our windows.

The whole thing is stupid really. My brother however, lives in Clear Lake, TX and his house that he bought 3 years ago was $250,000 3,250sq/ft and has a really nice big back yard in a nice neighborhood. So that's over 1,000sq/ft bigger then ours for about $1,000,000 less....so stupid!

I need to move out soon but even renting a room in a crappy part of where I live is at least $700/month...for a room in somebody's house.

More people want to live in SB than in Clear Lake, Texas.

5150dhbiker · Jul 8, 2011

Ciaran said:
More people want to live in SB than in Clear Lake, Texas.

Ok, very true...you would not catch me ever living there or even more then a week there to visit my brother. Haha, he even gets married next weekend and it's going to be in Colorado since nobody can stand Clear Lake!

But still the SB home prices are stupid. Granted it's a really nice town but I don't get why people are willing to dish out well over $1,000,000 for an average looking home.

Home prices, etc

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