Garth Turner - Real Estate in Canada

[oddballstocks]

I'm reading this thread with fascination.  Are salaries really that much higher in Canada?  gary17 mentioned that a working class couple in Canada would make $60-100k, in the US a working class couple is probably making $35-40k at most.  But our houses are cheaper, you can buy a house for $100k in most cities outside of LA/NYC/SFO.  The rule of thumb I'd always heard was 2.5x income for a mortgage, so someone making $40k can buy a $100k house.

Are Canadians house poor?  I know in the early 2000's here there were stories of people stretching for a big house only to have a ton of empty rooms.  Yet if a working class person can really make six figures and you have two incomes in the family I guess I can see how a $400-500k house is affordable.

What's an average professional white collar salary up there 150-175?

[gary17]

Oddball -
I think may be I am mistaken with my English

When I said a couple makes $60 - 100K  --- i mean the COMBINED earnings of the couple. 

I.e., may be 30K + 30K = $60K
Or $50K + 50K = $100K.   

Average salary for engineers working in BC  :  https://www.apeg.bc.ca/Careers/Compensation-Survey

Gary

I'm reading this thread with fascination.  Are salaries really that much higher in Canada?  gary17 mentioned that a working class couple in Canada would make $60-100k, in the US a working class couple is probably making $35-40k at most.  But our houses are cheaper, you can buy a house for $100k in most cities outside of LA/NYC/SFO.  The rule of thumb I'd always heard was 2.5x income for a mortgage, so someone making $40k can buy a $100k house.

Are Canadians house poor?  I know in the early 2000's here there were stories of people stretching for a big house only to have a ton of empty rooms.  Yet if a working class person can really make six figures and you have two incomes in the family I guess I can see how a $400-500k house is affordable.

What's an average professional white collar salary up there 150-175?

[oddballstocks]

Canada is (far) more expensive than the US from housing to groceries. It has higher taxes too as well as semi socialist policies. Generally the competition is not as much as in the U.S.

I think Sanjeev and Alanesh are home owners in Vancouver and it would be good to hear from them as well.

I'm reading this thread with fascination.  Are salaries really that much higher in Canada?  gary17 mentioned that a working class couple in Canada would make $60-100k, in the US a working class couple is probably making $35-40k at most.  But our houses are cheaper, you can buy a house for $100k in most cities outside of LA/NYC/SFO.  The rule of thumb I'd always heard was 2.5x income for a mortgage, so someone making $40k can buy a $100k house.

Are Canadians house poor?  I know in the early 2000's here there were stories of people stretching for a big house only to have a ton of empty rooms.  Yet if a working class person can really make six figures and you have two incomes in the family I guess I can see how a $400-500k house is affordable.

What's an average professional white collar salary up there 150-175?

Yeah, I guess I just never realized how much more expensive it was.  I wonder why?  It seems like goods should be just as cheap as in the US, they have plenty of roads, rail and ship lines that connect.  Maybe an import duty tax or something, but I wouldn't think that much.

[oddballstocks]

Oddball -
I think may be I am mistaken with my English

When I said a couple makes $60 - 100K  --- i mean the COMBINED earnings of the couple. 

I.e., may be 30K + 30K = $60K
Or $50K + 50K = $100K.   

Average salary for engineers working in BC  :  https://www.apeg.bc.ca/Careers/Compensation-Survey

Gary

I'm reading this thread with fascination.  Are salaries really that much higher in Canada?  gary17 mentioned that a working class couple in Canada would make $60-100k, in the US a working class couple is probably making $35-40k at most.  But our houses are cheaper, you can buy a house for $100k in most cities outside of LA/NYC/SFO.  The rule of thumb I'd always heard was 2.5x income for a mortgage, so someone making $40k can buy a $100k house.

Are Canadians house poor?  I know in the early 2000's here there were stories of people stretching for a big house only to have a ton of empty rooms.  Yet if a working class person can really make six figures and you have two incomes in the family I guess I can see how a $400-500k house is affordable.

What's an average professional white collar salary up there 150-175?

Gary,

Thanks for the clarification.  Now that I'm looking at these average and median salaries I'm wondering (like everyone else) how anyone can afford a home up there.  The cost and salaries are really out of line.

[NormR]

Median total income: Canada: $74,540 (2012)

http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/famil108a-eng.htm

[gary17]

This is the latest 'high end' condo being marketed right now in Vancouver

I stopped by there --  a 2 bedroom condo at the lower floors with no view starts at $1M...  For $800K you can buy a 1 bedroom or a studio...   

http://vancouverhouse.ca/       (PS. This was 80% sold - )

Or a working couple could spend $500K for a 600sf condo downtown Vancouver

http://jamesonhouse.com/2904-gallery

 

[oddballstocks]

This is the latest 'high end' condo being marketed right now in Vancouver

I stopped by there --  a 2 bedroom condo at the lower floors with no view starts at $1M...  For $800K you can buy a 1 bedroom or a studio...   

http://vancouverhouse.ca/       (PS. This was 80% sold - )

Or a working couple could spend $500K for a 600sf condo downtown Vancouver

http://jamesonhouse.com/2904-gallery

That first link is awesome, what a building!  Hope they finish it before a crash, that thing would look hideous half finished.  I much prefer developers build beautiful buildings like that verses the cookie cutter stuff you see here.

Norm, thanks for the median stat, it's 50% higher in Canada verses the US ($50k).  Now if everything costs 50% more it's just a wash, interesting eitherway.

[oddballstocks]

Two other data points, Canadians have a wealthier middle class, and as a whole are much wealthier than Americans.  So maybe the prices are just reflecting that Canadians can and will pay more for places?

You can get some truly cheap housing in the US.  My brother rents an apartment that's probably 800 sq ft two bedroom.  He has a roomate, they each pay $250 a month.  It's in a nice city, and the building is in nice shape.

I wonder if anyone's living in Buffalo and commuting into Toronto each day?  Making Canadian money and paying Buffalo prices, the new wealthy... I guess the same could be true for BC as well.

[50centdollars]

This is the latest 'high end' condo being marketed right now in Vancouver

I stopped by there --  a 2 bedroom condo at the lower floors with no view starts at $1M...  For $800K you can buy a 1 bedroom or a studio...   

http://vancouverhouse.ca/       (PS. This was 80% sold - )

Or a working couple could spend $500K for a 600sf condo downtown Vancouver

http://jamesonhouse.com/2904-gallery

That first link is awesome, what a building!  Hope they finish it before a crash, that thing would look hideous half finished.  I much prefer developers build beautiful buildings like that verses the cookie cutter stuff you see here.

Norm, thanks for the median stat, it's 50% higher in Canada verses the US ($50k).  Now if everything costs 50% more it's just a wash, interesting eitherway.

Reminds me of the condos they built near me in Mississauga. Nicknamed the marilyn monroe buildings.
http://mysquareonecondo.ca/Mississauga/marilyn-monroe-condos/

[NormR]

Two other data points, Canadians have a wealthier middle class, and as a whole are much wealthier than Americans.  So maybe the prices are just reflecting that Canadians can and will pay more for places?

You can get some truly cheap housing in the US.  My brother rents an apartment that's probably 800 sq ft two bedroom.  He has a roomate, they each pay $250 a month.  It's in a nice city, and the building is in nice shape.

I wonder if anyone's living in Buffalo and commuting into Toronto each day?  Making Canadian money and paying Buffalo prices, the new wealthy... I guess the same could be true for BC as well.

There are less expensive places in Canada too.  Rural areas, smaller cities (Windsor, etc.)

Also, keep in mind that the figures I linked are for family income (generally 2 earners).  It'll be a bit higher in the big cities.

In addition, many big cities follow policies that tend to boost prices.  Zoning restrictions, anti-sprawl legislation.  The feds help boost prices on the insurance side via the CMHC.  Etc.

All that said, young families generally have a hard time buying - even with the low rates - without help from family. 

The real estate market seems quite stretched to me.  It's got to the point where you could buy a house in a big centre, or opt for one in a smaller town (or the U.S.) and enjoy a modest retirement based on the price difference.