Rent or Buy in Calgary

[flipstah]

Originally posted by msommers


Yep, it's just that easy

STFU. White is right.

But yeah, travel before buying a place. Or buy cheap and travel!

There's a lot of underlying costs to owning a home.

Renting definitely gives you flexibility to move around, at the cost of not having home equity (you can have other types of equity to compensate).

EDIT: Does your parents have a garage? Wrench there and buy a downtown pad for less!

Don't wrench in your parkade. You get yelled at for leaking ATF and it won't come off.

[Asian_defender]

You obviously are good with your money so why not crash with the parents for another year or two and save up a larger down payment?
I'm sure another year or two will put at least another 60k in your bank if not more.
You won't end up house poor and you'll have a better selection as your budget will be higher. Even if you end up with something smaller, you'll either have lower payments or less years on your mortgage. If I could turn back time then for sure I would have stayed at home for a couple extra years to rack up a bigger down payment

[ercchry]

Originally posted by Asian_defender
You obviously are good with your money so why not crash with the parents for another year or two and save up a larger down payment?
I'm sure another year or two will put at least another 60k in your bank if not more.
You won't end up house poor and you'll have a better selection as your budget will be higher. Even if you end up with something smaller, you'll either have lower payments or less years on your mortgage. If I could turn back time then for sure I would have stayed at home for a couple extra years to rack up a bigger down payment

And where is the advantage? With the way rates are heading I would not be surprised if they're up 0.5-1% by then... $400k purchase price with $60k down is $1525 at 2.5% over 25yr.... $120k down on same house at the higher rates is $1325-1400.... huuuuuge savings, well worth it... not to mention that prices should be rising from here out as long as nothing extra stupid comes out of trump's mouth

[ee2k]

Stay at home if you're comfortable with it - you have your own space, can bring in a loved one etc- and save your money. But don't save your money with mindset of being able to afford a bigger home. If your first home, don't stretch yourself and go get a $600K home, get something that is manageable and gives you a good balance. As a 20 something year old, you're too young to tie yourself down to a large mortgage and miss out on life such as travels, possible moves to a different city, adventures. You're too young to adult. Kudos for paying off your debt. But live a little, and if you have a good sizable down payment, use it so that you have less of a mortgage payment. There's more to life than a house, go explore.

[Manhattan]

Originally posted by ercchry


And where is the advantage? With the way rates are heading I would not be surprised if they're up 0.5-1% by then... $400k purchase price with $60k down is $1525 at 2.5% over 25yr.... $120k down on same house at the higher rates is $1325-1400.... huuuuuge savings, well worth it... not to mention that prices should be rising from here out as long as nothing extra stupid comes out of trump's mouth

If the US economy is in good shape it will lead to higher interest rates. HIGHER interest rates = LOWER house prices. Look at the sky high interest rates in the 80s and what it did to home prices.

[ercchry]

Originally posted by Manhattan


If the US economy is in good shape it will lead to higher interest rates. HIGHER interest rates = LOWER house prices. Look at the sky high interest rates in the 80s and what it did to home prices.

Home prices didn't drop till people started defaulting on 20% rates... that's not going to happen, plus people can lock in these rates for the next 5 years. Not to mention a full 1% just takes up to 2011 interest rates

[88CRX]

Where do you guys see rates going in the next 6 months/12months/24months?

[you&me]

I think the biggest factor in determining whether to rent or buy right now is where you see the next five years of your life going and if you plan on the place you'd buy now to last you at least that long (from my personal experience, don't make that bet). Are you in a relationship? Is your job stable? Do you have any desire for children in the near term? Do you have a dog? Want one? There are just so many factors...

Everyone's situation is unique, but in my opinion, in anything but a rapidly appreciating market, real estate fees simply take too big of a piece of the pie to justify moving any more frequently than 5+ years. With how the Calgary market is currently and the apparent direction of rates, I wouldn't expect any exemplary gains in the Calgary market in the near term. Of course, as ercchry said, you'll need a place to put the money you're saving to work as well...

I think I've seen this on Beyond before, but this is a handy calculator - http://www.nytimes.com/interactive/2...r.html?hp&_r=3

[ragu]

I'm guessing with $60k you'll buy $400-450k house. Now you have $0 and $340-390k debt. In case you need to sell, it will be hard with high transaction costs. Add on monthly tax ($200), insurance ($70), maintenance (?) etc.

Imagine if you're renting 1br $850/m condo DT (keep $60k invested {minimum 4%}, keep $270 minimum {tax+ins}). Add on other qualitative factors like not being tied down.

Buying has lots of emotions tied to it. Plus its heavily marketed by banks/ realtors etc.

Think about it and do what you think is best for you

[Twin_Cam_Turbo]

Originally posted by roopi
Since you already live at home and probably never get laid you might as well move to the burbs. It couldn't be much worse.

Live at home, can confirm terrible for courting ladies. The key is to just not care.

[ExtraSlow]

Renting right now looks quite attractive. Plus it's a much more flexible option if you might move cities, or you like to travel extensively.

Buying has a lot of transaction costs, and typical first time buyers move again within five years, incurring those transaction costs twice. Rent or stay at home until you are sure.

[Kari_310]

I was in the same situation as you so I decided to rent first downtown to get away from the terrible commute (new brighton). Like some other people have said it's definitely a much different experience and renting is a good way to test to see if you like it.

For me I love living dt, zero commute, always close to meet up with friends for a drink and always a stumble/$10 cab ride home. But you can really only know what you like by trying it out, you also might hate how busy it always is and how long it takes to get out of dt (20mins in rush hour), less space, no yard, etc.

One thing that you may not have thought about is something that happened to me twice. Both of my landlords decided to sell the place I was renting after I was there for a couple of years, they both offered it to me first at a really good deal but I a) didn't have the money saved at that time and b) after living there I knew all the things I hated about the place. But even if that doesn't happen you could always ask them to sell if you love the place and they may be inclined based on the quick sale, this happened to a friend of mine renting a house.

And on that note, renting really shows you home ownership firsthand and helps you decide what you love/hate and that greatly changed my priorities on what I wanted when I was buying my first home. (ex. amount of storage space I actually use, 2 bathrooms, amount of light, etc)

My story ended with buying a brand new townhouse off of 17th ave with a 2 car tandem garage for what a full house would cost in the burbs but I am 100% happy with what I am giving up for the dt lifestyle.

[pheoxs]

Originally posted by Kari_310

My story ended with buying a brand new townhouse off of 17th ave with a 2 car tandem garage for what a full house would cost in the burbs but I am 100% happy with what I am giving up for the dt lifestyle.

This is the route I decided I'd go next time. Location is more important to me now than before I bought my first time home. The long commute impacts a lot in life, not just commute but as you said, more effort to meetup with friends or friends to come over. Makes appointments or going out for drinks more effort, etc.

I'd take a smaller townhouse with a garage over a larger house in the burbs. Especially if you don't have any kids at the moment. A 4 bedroom house was a total waste for me. Moving to a 1 bed + den is perfect for now and a 3bed townhouse once I need more space is definitely the plan.

[flipstah]

Originally posted by The BMW Guy
^ Good points. I don't think I'd move from Calgary (not permanently, anyway). I have too much family here and have close ties with many of them.

So my current train of thought: ideally I'd buy a place near the universities or LRT line for under $400k with a double garage and rent out the basement/rooms....but there's nothing under $400 that satisfies those. Hence staying at home and continuing to save for a down payment is a viable option in the polls too. (unless there are other attractive rental locations for under $400k)

But also with rent being so cheap, if I can split a 2 bedroom condo downtown with someone I'd be paying $700-$800 including downtown parking. A 5 minute walk to work and the condo/downtown living would be something special as well, for a cost of ~$10k/year of rent.

$800/month rent? That's cheap af! Hope you find what you're looking for.

[lasimmon]

Yah $800 each for a 2 bedroom downtown is really cheap even in this market - unless its a total dive. Especially if you both have cars, because there are very few with 2 parking spots.

[Manhattan]

https://www.rentfaster.ca/ab/calgary...own-eau-298014

Pay a little more and get a baller spot with TWO parking spots. You can probably negotiate down since it's such a renter's market.

[403ep3]

I was in your situation 3-4 years ago. I don't know if you mentioned if you were in a relationship, but I had a girlfriend was deciding what we should both be doing.

We were both working and deciding if we wanted to move in together (both lived at parents house). We ended up using our savings to purchase a detached home in the NW instead of going the downtown route. We were happy we went with that choice as it gave us more privacy and we were never really into the downtown lifestyle after all. Since then, we ended up purchasing a move up home near where we purchased 4 years ago. Couldn't be happier.

Renting was never an option as I wanted to pay my own mortgage.. not someone else's. I could of stayed at home with my parents, but 20+ years was enough for me

As long as you know how to spend and save your money you will still be able to travel, although not balling ass ones.

[The BMW Guy]

Originally posted by Manhattan
https://www.rentfaster.ca/ab/calgary...own-eau-298014

Pay a little more and get a baller spot with TWO parking spots. You can probably negotiate down since it's such a renter's market.

I wish!

My potential roommate isn't willing to spend more than $800 each. Found a $1400/month 2 bed/2 bath place that's 2 blocks from my work and 2 parking stalls. Only crappy thing is it's a bit on the small side (800 sqft, or maybe I'm just not used to how cramped condos feel) with no storage locker (for my hockey gear, mostly).

The price is fair, especially with me paying ~$200/month for parking downtown already. Just got to get my potential roommate on board.

[flipstah]

Originally posted by Manhattan
https://www.rentfaster.ca/ab/calgary...own-eau-298014

Pay a little more and get a baller spot with TWO parking spots. You can probably negotiate down since it's such a renter's market.

Waterfront is awesome. The gas stoves are envious.

[ercchry]

So 3 bedroom, two roommates at $800 each.. $400k with $60k down 5 year fixed 25yr mort. ~$1525, plus other expenses probably ~$2125 monthly bills means that your portion would be $525

BUT you're paying down the principal too, which is more or less a forced savings account of sorts so you are actually making $300/month ($825 average in principal for first year) for a difference in savings of $1600 a month vs renting at $800/person