theiceman

I'm no guru but strange coincidence, a news article hit my feed this weekend suggesting this is not the time to buy in Canada's big cities with increasing interest rates and decreasing house prices. I'm not offering an opinion , just suggesting you look for the article.

uniquenamehere

I agree... every millennial I know has the latest and greatest Android or Apple phone and a sweet home gaming PC. Why go outside to drive when you can just do it on your gaming system?

gsxr_fvr

Walk in any Starbucks & you see every teenager with the latest Iphone, latest macbook pro & a Canada Goose. That's atleast $7k of their hard earned minimum wage salary in the retail industry. The Need to have latest and the greatest amongst millennials unfortunately will never allow them to save that 20% down for their first home.

myw

agreed, alot of these kids also purchase (re lease) brand new cars via the never ending rent cycle of car 'ownership'.

LastMezger

Isn't it awesome? I never thought I'd be able to "afford" these cars!

leaf345

More likely it is that that your sample is skewed if you're walking into a Starbucks. Besides, when your average starter home is 1.5 million in the GVRD, no one working in retail was ever going to be able to afford their first home. It's no coincidence that discount trading platforms and ETFs have taken off so much in the last 10-20 years.

docdrs

Exactly, it isn't right now, but if what they are buying is not manufactured in North America then there will be less jobs here and that will be the trickle down factor.....again i hope Im wrong but I see it coming.......the millennial or whatever you call them will just think the rents will bail them out...

Henley1

exactly. .. just drove thru buffalo to the airport here. passed a ton of buildings. American radiator, u.s. nipples the list goes on.... all abandoned. a product of outsourced manufacturing. cheap is never cheap.

ggrace

993GT

there's plenty of millennials who skew the opinion of this thread the latest/greatest/overspend is an issue for most generations...
I think there's going to be plenty of opportunity soon for those who have been conservative

minthral

Not sure about Canada, but typically real estate investments work long term (10-20+ years). If you're thinking "let me buy something that will appreciate in the next few years and so I can resale" I'd be cautiousness. Instead you need to be able to afford a downturn and hold till recovery during this period.

Johnny DB

Good advice!

petee_c

duplicate

petee_c

It's very hard to flip a home without putting a lot of sweat equity into it...

BY my basic math,
You lose the first 4-5% on realestate and lawyer fees.
and then another 3-4% per year on the mortgage interest...

You need to hope that the property goes up by at least 6% in the 1st year to make a profit.... I'd rather put it in a high interest savings account @2% or GIC @ 3%...

Your house cost $100 today, in 2020, you want to sell it for $110
You put $20 down as your downpayment, and mortgage $80
When you sell, you have to pay your RE agent $4.40
During the year, you pay the bank (*0.035x80) interest $2.8
Property taxes for the year $0.60
So you would make $10-$4.4-$2.8 - $0.60 = $2.2 on your $20 investment over the year.

steam_mill

I know some really smart millennials. One of my staff, under 35 bought her first house when she was 25 with her then boyfriend/now spouse. Live in a 1 bedroom apt. in the house. Lived rent free and build equity. Now lives in a much larger home, still rents out an apartment. Oh, and as a family, they have a very good income. They drive 1 conservative car. Never have the latest and greatest either. Actually reminds me of how my wife and I were at that age. Not all millennials are the same.

I figure, regardless of generation, can't help stupid.

Fast rewards require risk. If you want a sure thing there is only one simple rule that everyone should follow:

DO NOT FINANCE DEPRECIATING ASSETS.

This one rule will ensure financial success and most importantly financial independence.

Think about all the money many people spend just to get money. Unfortunately, how whole economic structure has moved away from production of a tangible item to financing necessary items. It used to be that Ford made a car for $5 and sold it for $7.50 and so made $2.50 on every car. Now Ford makes a car for $50, sells it for $55 and then finances it for 8 years and puts people in revolving debt.

How many people come to me car ads that say 0% financing but then the fine print lists the price of the car for cash and at least a 10% higher price if you finance.