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Baronjutter posted:The house that was assessed at 450k and went on sale over a year ago at 649, then taken off the market for a few months, then back up at 669, then up to 689 is STILL unsold over a year later. People do this? Just seems like hopelessly wishful thinking to think that listing at a higher price makes any kind of sense after failing to sell at a lower price. It's like some kind of hopeless petty negotiation with the world or something: "Well, gently caress you all - you didn't want it at $X, well now it's gonna cost you $X+Y"! Argh, I need to stay out of this thread. As a deeply-ingrained value-investor, everything about real estate in this country drives me loving bonkers.
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Feb 14, 2014 20:53
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It's a mid-century bungalow they put granite counters into. That poo poo just grows in value every month. Granite counters are like a fine wine and get better with age.
Baronjutter fucked around with this message at 20:58 on Feb 14, 2014 |
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Feb 14, 2014 20:55
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^^^: The real estate boards are reporting strong sales and increasing prices. It doesn't take a speculator mind set to price your house like that (though it helps), it just requires a naive belief in what the industry is telling you. My house is worth $X, houses have increased in value by Y% over the last month/quarter/year so my new price is $X+Y%. It's just inflation for dummies that don't know that inflation is actually <2%.Lexicon posted:This phenomenon makes no goddamn sense to me. You only need to look at the foregone rent as a function of the months empty to very quickly realize that that 10-20% price cut pays for itself very quickly. If they were the sort to "run the numbers", they probably wouldn't own the unit in the first place.
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Feb 14, 2014 21:04
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Lexicon posted:People do this? Just seems like hopelessly wishful thinking to think that listing at a higher price makes any kind of sense after failing to sell at a lower price. It's like some kind of hopeless petty negotiation with the world or something: "Well, gently caress you all - you didn't want it at $X, well now it's gonna cost you $X+Y"! they really, really do. It's not even like you could make an offer of $450k either even if it was the only offer. Most owners wouldn't accept it. For example, I check on estate agents board torontolofts.ca. There's an $800k 2bed loft there that I swear has been on the market for at least 2.5 years since I first went to that site. I mean, it's fine, maybe I'm cheap but nothing with 2 beds in $800k fine. And it's a new place too, not like the owners inherited an old place or anything. http://www.torontolofts.ca/loft3324_church101.html Edit: I've actually seen this phenomenon for a lot of things, particularly trying to buy stuff off of kijiji. People list stuff for way higher than its worth and are absolutely unwilling to move on price. It really threw my husband off because he comes from a "haggling culture" and dealing with people like that is kind of awkward. peter banana fucked around with this message at 21:15 on Feb 14, 2014 |
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Feb 14, 2014 21:04
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People really don't run the numbers. Our rich friends have a huge house they built a large addition on. They don't feel they'll make enough PROFIT selling now, so the plan is to rent it out, at a loss, for how ever many years it takes for prices to go up. What's going to happen is that they sell it for less than they could have today a couple years down the line. Or stubbornly hold onto it for years and years blaming government or outside forces for "driving down prices and screwing us over" while renting at a huge loss. Other people bought an "investment" house in a real poo poo suburb north of town that they fixed up, badly, them selves, and held out for over a year because they didn't feel any of the offers were "fair". They ended up being forced to sell at a bigger loss than if they took the first fair offers. Meanwhile in the 80's my parents some how lucked out and owned 2 houses. My dad's work went on strike and since they had no savings they panicked and sold the investment-house at the very bottom of the 80's crash. I think a lot of boomers remember this period and have this idea that as long as you wait, prices will rocket up again. I mean I guess that's true in the extreme long run by in the extreme long run you're dead.
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Feb 14, 2014 21:15
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Baronjutter posted:Other people bought an "investment" house in a real poo poo suburb north of town that they fixed up, badly, them selves, and held out for over a year because they didn't feel any of the offers were "fair". They ended up being forced to sell at a bigger loss than if they took the first fair offers. Ahh Langford 
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Feb 14, 2014 21:22
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Baronjutter posted:It's a mid-century bungalow they put granite counters into. That poo poo just grows in value every month. Granite counters are like a fine wine and get better with age. Tons and tons of people actually think this—that if you spend $10,000 on a renovation, the value of your house necessarily goes up by at least $10,000. They don't seem to comprehend that in a market that values these things correctly, you will see some, but not all of what you pay put back into the value of your house. The only time spending $10,000 renovating your bathroom and kitchen is going to make you $15,000, guaranteed, is when you're in the runup phase of an inflating bubble. If the average person can borrow too much, you'll always find someone who'll pay too much for your house.
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Feb 14, 2014 23:29
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Lexicon posted:People do this? Just seems like hopelessly wishful thinking to think that listing at a higher price makes any kind of sense after failing to sell at a lower price. It's like some kind of hopeless petty negotiation with the world or something: "Well, gently caress you all - you didn't want it at $X, well now it's gonna cost you $X+Y"! When people re-list at a higher price it is generally because the initial strategy was to list under what they wanted in hopes of sparking a bidding war, and it didn't work. Yes it is loving crazy, but that is why it happens.
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Feb 14, 2014 23:40
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tagesschau posted:Tons and tons of people actually think this—that if you spend $10,000 on a renovation, the value of your house necessarily goes up by at least $10,000. They don't seem to comprehend that in a market that values these things correctly, you will see some, but not all of what you pay put back into the value of your house. The only time spending $10,000 renovating your bathroom and kitchen is going to make you $15,000, guaranteed, is when you're in the runup phase of an inflating bubble. If the average person can borrow too much, you'll always find someone who'll pay too much for your house. More anecdote time! My friend's mom was an insane case of this. She saw her self as a shrewd and pragmatic investor but always over spends on stupid poo poo thinking along that exactly logic. If you put 10k into something you will get at LEAST 10k in value out of it, so always go for the best most expensive option. They were selling their house and renovating the kinda dingy basement suite. This was going to be a minor reno but it turned into a 150k+ nightmare due to the previous owners basically building the whole thing out of load-bearing drywall. Yes, spending what is needed to replacing loving missing structural posts that were causing the house to sag is a good and needed investment. Ordering in the best granite counter tops and fanciest appliances for a tiny nearly windowless basement suite is not. I mean its the loving part of the house you rent out. So fixing hidden problems and installing a super nice kitchen and bathroom in a basement suite didn't really do much to the sale price at all. I love how "granite countertops" has become basically a house-flipping meme but it's so absolutely true. Every lovely amateur house or condo flipping I've ever met has regaled me with how easy it is to "just put in granite counter-tops, nice fixtures, and stainless steel appliances and you'll get back double what you put in!"
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Feb 15, 2014 02:08
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Baronjutter posted:More anecdote time! My friend's mom was an insane case of this. She saw her self as a shrewd and pragmatic investor but always over spends on stupid poo poo thinking along that exactly logic. If you put 10k into something you will get at LEAST 10k in value out of it, so always go for the best most expensive option. They were selling their house and renovating the kinda dingy basement suite. This was going to be a minor reno but it turned into a 150k+ nightmare due to the previous owners basically building the whole thing out of load-bearing drywall. Yes, spending what is needed to replacing loving missing structural posts that were causing the house to sag is a good and needed investment. Ordering in the best granite counter tops and fanciest appliances for a tiny nearly windowless basement suite is not. I mean its the loving part of the house you rent out. So fixing hidden problems and installing a super nice kitchen and bathroom in a basement suite didn't really do much to the sale price at all. Yeah compared to other improvements such as new siding or even nicer lawn landscaping it doesn't recover cost. Basically a dumb move you tend to see in easy credit bubble conditions Rime posted:I found this article to be a particularly interesting example of why Germany remains the strongest economy on the planet, among other things. We could take a page out of their book. It's a great article pointing how a affordable rent economy is much better and also helps keeps home ownership prices low assuming you can meet the strict loan requirements such as 20% down. Besides the obvious problems, the US housing basically leads to overallocation of resources in one basket and also doesn't actually increase home affordability due to the nasty boom-bust cycles. etalian fucked around with this message at 03:20 on Feb 15, 2014 |
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Feb 15, 2014 03:10
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tagesschau posted:Tons and tons of people actually think this—that if you spend $10,000 on a renovation, the value of your house necessarily goes up by at least $10,000. They don't seem to comprehend that in a market that values these things correctly, you will see some, but not all of what you pay put back into the value of your house. The only time spending $10,000 renovating your bathroom and kitchen is going to make you $15,000, guaranteed, is when you're in the runup phase of an inflating bubble. Well, it's a little bit more subtle than that (although I think you are acknowledging that as well). Even in healthy markets, mostly-rational people value things very differently. I mean, you might have a buyer who is willing to pay a premium to live in a specific neighborhood, but only is interested in places that are 'move-in ready'. I'd also argue that in a deflating bubble spending money on renos also has a lot of value, as it can mean the difference between your place selling and sitting on the market for months.
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Feb 15, 2014 04:37
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I read this and thought "who the gently caress is chris alexander?" http://www.cbc.ca/news/business/chris-alexander-says-canada-s-doors-still-open-to-rich-chinese-1.2537826 motherfucker looks like a child molester. 
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Feb 15, 2014 05:13
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 Buy a condo in Toronto, GET FREE poo poo
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Feb 15, 2014 05:54
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It's a 26K condo?
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Feb 15, 2014 05:57
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tagesschau posted:Tons and tons of people actually think this—that if you spend $10,000 on a renovation, the value of your house necessarily goes up by at least $10,000. They don't seem to comprehend that in a market that values these things correctly, you will see some, but not all of what you pay put back into the value of your house. The only time spending $10,000 renovating your bathroom and kitchen is going to make you $15,000, guaranteed, is when you're in the runup phase of an inflating bubble. If the average person can borrow too much, you'll always find someone who'll pay too much for your house. You have a $200 toilet in your house. You throw it out and replace it with a $500 toilet. Congratulations, you just increased the value of your house by $300! Cultural Imperial posted:I read this and thought "who the gently caress is chris alexander?" I almost feel bad for Chris Alexander: Wikipedia posted:In 1991, Alexander joined the Canadian Foreign Service. He was posted to the Canadian embassy in Russia in 1993 as Third Secretary and Vice-Consul. In 1996, he returned to Ottawa to become an assistant to the Deputy Minister of Foreign Affairs. In 1997, he became Deputy Director (Russia) of the Eastern Europe Division responsible for political and trade relations. In 2002 he returned to the Canadian embassy in Moscow as Minister Counsellor (Political). In August 2003 he became the first resident Canadian ambassador in Kabul, Afghanistan, relieving resident chargé d'affaires a.i. Keith Fountain. From 2005 until mid-2009, he served as one of two deputy special representatives of the United Nations Assistance Mission in Afghanistan (UNAMA). He could have been somebody, instead he's just parroting the PMO's talking points in a vain attempt to get ahead in a government that isn't going anywhere.
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Feb 15, 2014 06:03
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Whiskey Sours posted:You have a $200 toilet in your house. You throw it out and replace it with a $500 toilet. Congratulations, you just increased the value of your house by $300! don't ever feel bad for any loving tory. he knew what he was getting into and still whored himself. gently caress him
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Feb 15, 2014 06:41
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Dusseldorf posted:It's a 26K condo? I think that would be the "deposit", paid over time.
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Feb 15, 2014 07:18
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Pixelboy posted:I think that would be the "deposit", paid over time.
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Feb 15, 2014 10:57
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Cultural Imperial posted:
That really serves to highlight the [lack of] financial sophistication of these buyers. I'd be frankly insulted that this big financial purchase I'm making is being packaged along with a set of shiny, distracting baubles. Surely condo buyers pre-bubble weren't getting transit passes thrown in?
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Feb 15, 2014 16:02
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Interesting Tara Perkins piece on what goes into the sausage of selling a condo: http://m.theglobeandmail.com/report...?service=mobile
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Feb 15, 2014 16:03
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Lexicon posted:That really serves to highlight the [lack of] financial sophistication of these buyers. I'd be frankly insulted that this big financial purchase I'm making is being packaged along with a set of shiny, distracting baubles. Surely condo buyers pre-bubble weren't getting transit passes thrown in? Ehhh, shiny distracting baubles have always been used to butter people up for a property purchase. Ever heard of an open house with a buffet? Same sort of manipulation as seen here, though this case is pretty blatant.
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Feb 15, 2014 16:26
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Cultural Imperial posted:
Ha! Torontonians are getting screwed. Here in Vancouver they're giving away Fiat 500s with condos.
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Feb 15, 2014 16:27
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AVeryLargeRadish posted:Ehhh, shiny distracting baubles have always been used to butter people up for a property purchase. Ever heard of an open house with a buffet? Same sort of manipulation as seen here, though this case is pretty blatant. You might be right about that, but the example of an open-house buffet doesn't qualify for what I'm talking about. There's nothing wrong with incentives to get potentially-interested people in the door - businesses do this all the time. You won't ever sell to some large percentage of the people who partake of the incentive - but it's worth giving it away just to get their ear and create a selling opportunity. Costco samples are another example of this. This is different - you're already making the purchase of a condo, and they are throwing in a transit pass to make it seem like a better deal. They aren't giving away a transit pass as an incentive to sit through a sales purchase - you get it with the purchase itself. That's what I'm objecting to. ductonius posted:Ha! Torontonians are getting screwed. Here in Vancouver they're giving away Fiat 500s with condos. Nah - the joke's on anyone who ends up owning a Fiat, free or otherwise.
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Feb 15, 2014 16:39
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Lexicon posted:That really serves to highlight the [lack of] financial sophistication of these buyers. I'd be frankly insulted that this big financial purchase I'm making is being packaged along with a set of shiny, distracting baubles. Surely condo buyers pre-bubble weren't getting transit passes thrown in? Hey bro, when I was in the back processing your mortgage, I accidentally messed up the mortgage details and added 10k to the purchase price. Would it be ok if I just gave you that 10k in cash right here? I really don't want to have to go back and explain my mistake to my boss.
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Feb 15, 2014 17:16
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on the left posted:Hey bro, when I was in the back processing your mortgage, I accidentally messed up the mortgage details and added 10k to the purchase price. Would it be ok if I just gave you that 10k in cash right here? I really don't want to have to go back and explain my mistake to my boss. 
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Feb 15, 2014 17:20
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I'm practically making money just by buying this condo! 
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Feb 15, 2014 17:21
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Lexicon posted:Nah - the joke's on anyone who ends up owning a Fiat, free or otherwise. Something overpriced that ends up costing the owner by breaking down in the near future? Sounds like the perfect gift to bundle with a Vancouver condo.
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Feb 15, 2014 19:54
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Baronjutter posted:More anecdote time! My friend's mom was an insane case of this. She saw her self as a shrewd and pragmatic investor but always over spends on stupid poo poo thinking along that exactly logic. If you put 10k into something you will get at LEAST 10k in value out of it, so always go for the best most expensive option. They were selling their house and renovating the kinda dingy basement suite. This was going to be a minor reno but it turned into a 150k+ nightmare due to the previous owners basically building the whole thing out of load-bearing drywall. Yes, spending what is needed to replacing loving missing structural posts that were causing the house to sag is a good and needed investment. Ordering in the best granite counter tops and fanciest appliances for a tiny nearly windowless basement suite is not. I mean its the loving part of the house you rent out. So fixing hidden problems and installing a super nice kitchen and bathroom in a basement suite didn't really do much to the sale price at all. My parents in London are like this. I honestly don't understand how they make money. They spent 50k and two horrendous months of their lives getting an inground pool put in (when my little half-brother was 3 btw. Little kids around a pool, great idea, folks) the installers basically had to dig up their entire backyard several times because the hole fell in due to rain a few times. They are now convinced that if they ever sell the house it'll add at least that amount to the sale price. Ironically, they chose between a pool and finishing their basement. Oh did I mention they both work in Toronto? Yeah they commute from London to Toronto and now if they ever want to sell their stupid barn of a house in London they'll have to take a huge hit. Cultural Imperial posted:
*sniffs* ahhhh, what is that? Is that desperation I smell?
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Feb 15, 2014 20:04
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bro, I thought it was common knowledge that pools *always* bring down the value of your home.
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Feb 15, 2014 20:27
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Lexicon posted:Interesting Tara Perkins piece on what goes into the sausage of selling a condo: http://m.theglobeandmail.com/report...?service=mobile quote:Babak Habibzadeh, a 29-year-old risk manager with Royal Bank of Canada, lives with his parents and bought his first condo two years ago. He rents it out and has been delighted with the returns to date. hooooooooly fuuuuuuuuuck RBC hires loving people like this. This fuckface has a master's degree in stats from guelph. I GUESS THEY DON'T TEACH BASIC MATH SKILLS AT GUELPH
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Feb 15, 2014 20:31
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Housing thought of the day, courtesy of @yvrhousing:
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Feb 15, 2014 20:42
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Cultural Imperial posted:hooooooooly fuuuuuuuuuck Better still, he's a risk manager.
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Feb 15, 2014 20:50
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RBC was the bank called out last year for bringing in TFW's and having the staff who were fired train the TFW's to do their jobs, so I guess the gross incompetence on display isn't completely shocking, but still. 
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Feb 15, 2014 20:58
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LemonDrizzle posted:Better still, he's a risk manager. Everyone in banking from the janitor upwards* is a Director of some form or another, so it doesn't necessarily mean that this idiot is actually involved in any meaningful way vis-a-vis RBC's actual risk. Still. (* I can't take credit for this delightful truism - was in an Economist article I read a while ago)
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Feb 15, 2014 21:06
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vice President. every ibanking rear end in a top hat is a vp of something.
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Feb 15, 2014 21:10
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Cultural Imperial posted:Housing thought of the day, courtesy of @yvrhousing: Hmm okay so taking that at face value, I have learned that there are no longer any homeless people, and there must be a housing bubble because supply has exceeded demand for a long time now and yet prices keep going up.
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Feb 16, 2014 02:02
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eXXon posted:Hmm okay so taking that at face value, I have learned that there are no longer any homeless people, and there must be a housing bubble because supply has exceeded demand for a long time now and yet prices keep going up. Homelessness is a more complicated issue than # of houses < # of people. Home manufacture has exceeded population growth in Vancouver for sometime now.
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Feb 16, 2014 07:12
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Lexicon posted:You might be right about that, but the example of an open-house buffet doesn't qualify for what I'm talking about. There's nothing wrong with incentives to get potentially-interested people in the door - businesses do this all the time. You won't ever sell to some large percentage of the people who partake of the incentive - but it's worth giving it away just to get their ear and create a selling opportunity. Costco samples are another example of this. It's also to get the buyers in a good mood and create a sense of obligation towards the sellers. However that is beside the point. It still falls into the general category of extra things added as an incentive to make a purchase more likely. Lexicon posted:This is different - you're already making the purchase of a condo, and they are throwing in a transit pass to make it seem like a better deal. They aren't giving away a transit pass as an incentive to sit through a sales purchase - you get it with the purchase itself. That's what I'm objecting to. Is pre-furnishing of the condo any different? I mean they are throwing in all these appliances for free*! What about an open house where everyone who shows up gets entered into a raffle to win ~fabulous prizes~? I think your objection might be more rooted in the shameless brazenness of the offer more than its particular mechanics. *they are obviously included with the cost but I've heard people try to argue that they are being included for free.
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Feb 16, 2014 09:03
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It's actually an extremely expensive transit pass with a condo thrown in for FREE.
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Feb 16, 2014 09:12
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AVeryLargeRadish posted:Is pre-furnishing of the condo any different? I mean they are throwing in all these appliances for free*! At least those appliances are part of the condo. Your bank probably would not be too happy to discover that the condo you've borrowed money for at 3.75% is worth less than its list price, and the difference is made up of things for which loans usually require a higher interest rate.
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Feb 16, 2014 19:00
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