Rising costs of living, how are you dealing with it?

[Volvoman]

With some banks offering a 2.99% fixed mortgage rate right now, it may be a good time to buy. My advice? Buy a condo/townhouse in South Surrey, Langley or the Steveston area in Richmond. Vancouver is too expensive to own, especially when neighboring cities are only minutes away.

Also OP, you are me 7 years ago. I was in my 20's, graduated from BCIT in Telecommunications, making just about 40k a year and living at home. Save money, save it like no tomorrow. Once you have a mortgage and other things that come with home ownership, you will wish you had more money at the end of the month.

[jasonturbo]

Originally Posted by Volvoman

With some banks offering a 2.99% fixed mortgage rate right now, it may be a good time to buy. My advice? Buy a condo/townhouse in South Surrey, Langley or the Steveston area in Richmond. Vancouver is too expensive to own, especially when neighboring cities are only minutes away.

Also OP, you are me 7 years ago. I was in my 20's, graduated from BCIT in Telecommunications, making just about 40k a year and living at home. Save money, save it like no tomorrow. Once you have a mortgage and other things that come with home ownership, you will wish you had more money at the end of the month.

If you're talking about RBC's 4 year or BMO's 5 year fixed @ 2.99%, forget it.

They have both been turfed, RBC is now 3.39% 4 year and BMO is 3.49% 5 year.

Oddly enough both banks cancelled the 2.99% immediately after CMHC made the anouncement that they were near their max... I guess the banks don't like risk.. when they actually have to assume some of it. (Espcecially when the BOC hasn't changed the prime rate.)

On top of that, if you look at the fine print of these mortgages, for instance the BMO you would notice that: (Stolen from a website to save me time lol..)

"The 2.99% rate is an excellent lure into an inflexible mortgage; here are the key restrictions that home-owners may unknowingly be locking themselves into…

There are hefty penalty clauses (It's also non-transferable)
The maximum amortization is only 25 years
It is somewhat restrictive with its prepayments – only 10% prepayment per year and it only increases 10% of your prepayment per year
Here is what BMO themselves have said about their product – "Full repayment before maturity can only occur if property is sold to an unrelated purchaser at fair market value or if the mortgage is renewed or refinanced into another BMO mortgage product.”

[Over9K]

Age: 34
Annual income: Around $24k "ish"
Field of employment: Junkyard Reaper
Where do you live? Aldergrove
Single/couple/married? Single
Renting/own? Own
Investments: My big pile of pre Ghosn era Nissans.


Got more than enough.

[asian_XL]

Originally Posted by PJ

Nothing's wrong with living with your parents.. to a certain extent. It all depends on your situation.

I'm making about 3x more than what both my parents make combined, and I live at home. They're pretty tight on cash, especially with my younger brother still in high school. I'm still living at home so I can help out by paying them rent, as well as their bills, groceries, and my younger brother's expenses.

But like I said a few posts above, my little bedroom can't accommodate my space requirements for my business and side projects, so we're throwing around the idea of getting a foreign exchange student to take my bedroom as I move out into a condo. But I'd probably still give them a few hundred bucks a month to help out with their expenses.

For my situation, I used to live in a 3500sqft house with my parents, then moved to a 950sqft apartment, later packed my stuff to Hong Kong staying at my parents' 900sqft (merely 100sqft for my own little room), rented a 700sqft space for 2 yrs and moved back home, now living with my gf at a 500sqft with 2x4ft Ikea work desk as my personal area. Average rent here for a 2 bedroom here is around $2,000cdn, that is way more than the 1:3 rent/income rule, so I gave up the idea renting or owning a suite, even though I have excessive cash with me.

There's no reason to force yourself to move out and carry such a heavy burden if you cannot afford to do so. What goes up must come down, especially when majority of the population afforability level is at the borderline. Just wait a bit longer for the price to settle. For now just save up like no one, and gave up all the car modding plans or buying a large TV.

[Death2Theft]

Whats this prepayment stuff all about?

Originally Posted by jasonturbo

If you're talking about RBC's 4 year or BMO's 5 year fixed @ 2.99%, forget it.

They have both been turfed, RBC is now 3.39% 4 year and BMO is 3.49% 5 year.

Oddly enough both banks cancelled the 2.99% immediately after CMHC made the anouncement that they were near their max... I guess the banks don't like risk.. when they actually have to assume some of it. (Espcecially when the BOC hasn't changed the prime rate.)

On top of that, if you look at the fine print of these mortgages, for instance the BMO you would notice that: (Stolen from a website to save me time lol..)

"The 2.99% rate is an excellent lure into an inflexible mortgage; here are the key restrictions that home-owners may unknowingly be locking themselves into…

There are hefty penalty clauses (It's also non-transferable)
The maximum amortization is only 25 years
It is somewhat restrictive with its prepayments – only 10% prepayment per year and it only increases 10% of your prepayment per year
Here is what BMO themselves have said about their product – "Full repayment before maturity can only occur if property is sold to an unrelated purchaser at fair market value or if the mortgage is renewed or refinanced into another BMO mortgage product.”

[Jermyzy]

Originally Posted by Volvoman

With some banks offering a 2.99% fixed mortgage rate right now, it may be a good time to buy. My advice? Buy a condo/townhouse in South Surrey, Langley or the Steveston area in Richmond. Vancouver is too expensive to own, especially when neighboring cities are only minutes away.
.

Steveston is getting quite expensive as well

Originally Posted by Death2Theft

Whats this prepayment stuff all about?

I believe prepayment is when you try to make early lump sump payments towards your mortgage principal amount.

[Acura604]

Age: 41
Annual income: $100K +
Field of employment: Sales & Management
Where do you live? Surrey
Single/couple/married? Married with KID!
Renting/own? Own - 7bdrm home
Investments: all sorts

while i'm not a big fan of living in surrey, it was ideal for my childsitting purposes as we are located in the middle of both parents who come to our home to watch our little munchkin. The house is brand new (completed in 2009) with a rented 2-bdrm suite (legal) in basement which offsets our mortgage by about $700. However, 5yr plan is to move away to eliminate all bridge crossings..so most likely into Burnaby. Dual income/savings greatly helped in putting down 20% on a $615,000 home... BUT we started small to big.

-owned a 700sq ft 2bedroom condo in Surrey...sold it.
-purchased a townhouse in BBY's TERRAMOR (government st) and sold it after a year.
-purchased a townhouse in North Delta's SUNSTONE (nordel) and sold it after a year.
-went house shopping and wife fell in love with the present house so we got it.

[Supafly]

Age: 26
Annual income: $50K+
Field of employment: Food Science/Engineering Consulting
Where do you live? Burnaby
Single/couple/married? Single
Renting/own? Renting (1200/month)
Investments: My bank draining Benz

Well, where do i start? As living cost rises, I started prioritizing what I really needed to survive comfortably. Learned to cook, clean and fend for myself instead of going out to eat luxrious dinners weekly with randoms and aquaitences; Cut out clubbing every week and killed off the drinking binges. Slimming down your group of friends to a "closer group" of friends that are in the same category helps aswell.
Picking up a second PT job is a good way to keep a bit of "play" money.

Working as a consultant isn't always the best feild to be in; sometimes your account is inflated and you got butterflies in your stomach and the next month you're calling out to see if corporate companies need to revise and develop their SOPs.

[Pooface55]

not to say that buying property is a bad idea... but consider this; i am renting and pay about 1400 for rent, my internet hydro etc... and i save a lot
on the side.

now if i were to purchase a home, that money would actually go somewhere, which is great. but the bad thing is, is i were to own a place, i would have to pay for maintenance e.g. like say, something were to break like a pipe, wires in the wall etc... it's all covered in renting(and if you have a great apartment manager, like i do, then it's taken care of really quickly.)

on top of that, you will pay property tax, water, heat(renting usually includes hot water and heat)... so yeah... take those into considering as well, because you're NOT just paying for the house. sometimes your monthly fee's to maintain the house yearly, might be the cost of renting a cheaper place sometimes.

i have a few friends who purchased condo's and say they live beside complete assholes... at least, if you have a home, you have space and if you were to rent, you could move.

again, not saying it's a bad thing to purchase a home. just saying you have to consider a lot of things before really going into it.

[melloman]

I'll play too:

Age: 22
Annual income: $50k+
Field of employment: Drafting/Engineering
Where do you live? Burnaby
Single/couple/married? Single
Renting/own? Living with parents
Investments: TFSA + Savings
Education: 1 year certificate VCC

OP: We're partially the same, yet I don't have to pay rent to my parents while living at home and I make abit more $$/year. Yet we're in the same boat for wanting to own young.

There are tons of ways to help grow income and work to owning.. I'm not sure if your parents can help or not yet 1 thing which has been told to me by many people is getting a "loan from your parents." Now before all u assholes flame me I say it for this:

Getting a loan from the parents can help you buy. Once you buy, you rent it out until you have a more suitable means of income. This means that someone has been paying your mortgage and your going to have not such a full load to pay off in the end.


Another means is Stocks. Like someone said before, you're young.. you can gamble. With a higher risk portfolio you can earn alot of money, and lose ALOT of money. Yet by researching and making the right choices, $1000 can turn into $10000 within a year. I don't have personal experience but I am reading up on medium size companies to start investing in to HOPEFULLY make a nice size chunk of change for a down payment in Burnaby/New Westminster.

[d1]

Just curious about trades line of work but are trades people who are earning relatively high incomes making that much because of a lot of over-time work or is their hourly wage just really high?

[What_the?]

Yea, i'm in the same boat where I feel like i'm making decent money, but at the same time feel like I can't afford anything in Vancouver either. At least not what I'd like.

The cost of "living" isn't super high I think (i.e. clothing, food, etc), but the cost of housing is pretty bad.

Plan is to continue saving, then purchase a 2 bdrm apartment to start with the gf. Then some years down the road when more space is needed for kids and things to purchase a house. The usual standard upgrade.

I've totally thought of moving to places like Victoria which I think are beautiful but cheaper, but the girlfriend is bound to Vancouver for now with work. So we're stuck. I'd say if you have a chance, consider somewhere like Victoria, or any other small town. If you are attached to Vancouver, just go somewhere outside but reasonably close by. Then you can come visit on weekends and still keep in touch with friends and family. I have friends that do exactly that.

[blum2001]

Age: 30
Annual income: 90-100k including salary + contract jobs
Field of employment: I.T.
Where do you live? Yaletown
Single/couple/married? in a relationship.
Renting/own? Principal place of residence mortgage $1100/month, $200/month strata + usual utilities
Investments: Stocks, RRSP's, couple self sustaining rental properties in Downtown and Burnaby rented fully furnished and unfurnished


The best decision I ever made at the age of 19-20 was to put away 50-70% of my paycheck for 3 years. It was tough having enough discipline to resist the urge of buying new toys, electronics, or spending money on things I didn’t need. When you’re making 40-50k/year living with the parents with only a cell phone bill to pay for, it’s easy to waste your own money. 3 years of saving allowed me to have enough for my down payment on my first real estate investment.

I'm sitting on the other side of the fence compared to a lot of people here. I’ll fully admit, I had it easier than most here trying to purchase a property because in 2004 my purchase price of my first property was about 40-43% less than what I could sell for now. If I was trying to get into the game now with these prices, I think i'd have a totally different approach to it. What would that approach be? I have no idea, but I do know I'd have to work a lot harder to get into the real estate market whether it's pick up more contracts or invest more wisely.

Originally Posted by Pooface55

not to say that buying property is a bad idea... but consider this; i am renting and pay about 1400 for rent, my internet hydro etc... and i save a lot
on the side.

now if i were to purchase a home, that money would actually go somewhere, which is great. but the bad thing is, is i were to own a place, i would have to pay for maintenance e.g. like say, something were to break like a pipe, wires in the wall etc... it's all covered in renting(and if you have a great apartment manager, like i do, then it's taken care of really quickly.)

on top of that, you will pay property tax, water, heat(renting usually includes hot water and heat)... so yeah... take those into considering as well, because you're NOT just paying for the house. sometimes your monthly fee's to maintain the house yearly, might be the cost of renting a cheaper place sometimes.

i have a few friends who purchased condo's and say they live beside complete assholes... at least, if you have a home, you have space and if you were to rent, you could move.

again, not saying it's a bad thing to purchase a home. just saying you have to consider a lot of things before really going into it.

I agree with you on the fact that it's cheaper to rent since you don't have to pay the property tax, strata and things that go along with owning a place. The flexibility of moving out whenever you want is ideal. I've had huge problems with my next door neighbor who also owns and sometimes I do wish I could just move as easily as a renter. But the landlord part of me also loves the fact that my renters are paying for my mortgages on my rental properties...

To the people who are trying to get into the market now and succeed on your own I give you full respect for doing because it's a LOT tougher than when I got in.

[ScizzMoney]

Age: 29
Annual income: 130k+
Field of employment: Oil Field
Where do you live? Fort McMurray / Calgary
Single/couple/married? Single
Renting/own? Rent a room in Fort McMurray
Investments: TFSA, RRSP, Pension, general savings account, Townhouse in which I rent out

Nothing comes easy. If you want to make good money or have a nest egg in your back pocket you have to be prepared to sacrifice. I have pretty much gave up my mid to late twenties working. And I mean working. I have friends that I haven't seen in a few years and even ruined a relationship because I was working so much. The sooner I realized not everyone gets to 'have it all' the faster I started to set myself up for the rest of my life, financially.

Want a house? Stay away from shit that won't help you get there like a 64gb iPhone. Want a nice car? Don't buy $300.00 shoes with your 30k a year salary. I'm not saying don't treat yourself, but make sure it's not overboard to what you are trying to achieve.

[AWDTurboLuvr]

Age: 31
Annual income: 80K Salary + 25K net rental income
Field of employment: Animation
Where do you live? Richmond
Single/couple/married? Married
Renting/own? Own, 3-bdrm condo, $1200/mth + $355 strata
Investments: Equities account, RRSP, two rental properties (Kerrisdale & Richmond)

I was in the same situation as Blum2001 was in that I bought my first couple of properties when it was considerably cheaper that what it is now.

However, if I was in my early 20's in today's market, I would either rent or stay at home to save more cash...and more than likely, move somewhere else for greater opportunities. Staying at home when I was young and making good money, was the perfect situation to save as much money as possible. I have to thank my Dad for instilling such a conservative saving attitude, because when you're young and you have some money lying around, it really is tempting to just buy that fancy car or in some other wasteful consumerist fashion.

[will068]

Age: 29
Annual income: 70k
Field of employment: Software Industry
Where do you live? Richmond
Single/couple/married? In a relationship
Renting/own? Rent
Investments: Stocks and Options

Most of my money is allocated for buying options and stocks. I guess you could say I am a part time options trader as well. This is what is getting me out of the rat race. Last year, I made $250K tax free (since the I traded under my US RRSP account) from my options trading alone. I urge everyone to invest in their financial education and trade on their own.

[JHatta]

How do you get a US RRSP....?

[Liquid_o2]

My situation is a bit different since I was working full-time for quite a few years and now just went back to school for my Masters. I graduated at 23 and started making 40k a year as a professional which was great at that age, especially since I was living at home. By the time I was 26 I had maxed out my TFSA and had money in quite a few other savings accounts. Was planning on buying my first condo if I didn't go back to school. BUT, I did and am definitely happy with the path I chose, unfortunately even with a student loan, all my savings are going to school, rent, living expenses etc.

I'll come out of the program with all my savings drained and a student loan but I'll be in a really good position moving forward. Not sure if I will come back to Metro Vancouver other than the fact that my old job wants me back (and my family is there), but only if it was at the right price.

Before I left for school:

Age: 26
Annual income: 45k
Field of employment: Urban Planning
Where do you live? Surrey
Single/couple/married? Single
Renting/own? Lived at home
Investments: TFSA (maxed), other savings accounts, stocks

Now in school (Toronto):

Age: 27
Annual income: 0
Field of employment: Urban Planning
Where do you live? Toronto
Single/couple/married? Single
Renting/own? Rent 1 bedroom (600sf) at $1050/month
Investments: Savings accounts (slowly disappearing)

People should definitely think about moving out of Metro Vancouver if they want to find better work. I know at least in my field, you can get paid 15-20% more as soon as you go east, whether it be Alberta, Saskatchewan, Ontario, and the positions are more plentiful.

Vancouver is an absolutely beautiful city with amazing food but it is completely unsustainable to live in for the majority of society.

[JKam]

Age: 23
Annual income: 40k
Field of employment: marketing communications
Where do you live? BBY/ Surrey
Single/couple/married? Serious relationship
Renting/own? live with family
Investments: maxed tfsa, some RRSP, high interest savings accounts

I've saved enough for a down payment but it doesn't make sense for me to buy now when I can keep saving and wait for the market to correct itself. The only issue is that I'm looking to get married in 5-7 years so I'd much rather have a place to call my own. I'm lucky that I might get help from my parents who want to co-own with me even though they will be living with my sister, brother and in asia each for 3 months.

If that doesn't work out my plan is to save until the housing market corrects itself. Right now I'm living at home on the weekends and at my sister's place during workdays (closer to work). I've cut out most of the money hungry habits (clubbing, dining out) and I'm slowly cutting back on the other hobbies (electronics, aquarium, photography). Stopped going on dates that require money and I have almost no expenses except for food and phone. I'm also lucky that work pays for my gas and the gf's brother in law is a Honda Tech so I get my maintenance for free. I don't care for living in Vancouver nor do I care about views. As long as I am in a metro area close to family (Burnaby, Richmond, Burquitlam area) I'm happy.

Also waiting until the girlfriend starts making money for me to plan out the future more accurately. I'm hoping that by that time I'll be making 80k + 80k from what the gf makes. Ideally we'll purchase a condo and live there until a baby comes along. Purchase a home (after market corrects) in Burnaby or Richmond and rent out the condo. Live happily ever after.

So I'm basically saving 30%ish of income while living at home and praying that the housing market corrects itself.

I'm also teaching the gf how much it actually costs to live and how we can't spend money on stupid shit. She's slowly getting it and trying to reduce her (small) education debt + save for future. Best part is that she isn't one of those money hungry bitches.

[PJ]

Originally Posted by d1

Just curious about trades line of work but are trades people who are earning relatively high incomes making that much because of a lot of over-time work or is their hourly wage just really high?

Depends on the trade.. I have a family friend who's 22, making $39/hour as an electrician. Another one of my close friends is a plumber and makes around $28/hour.

Originally Posted by JKam

I'm also teaching the gf how much it actually costs to live and how we can't spend money on stupid shit. She's slowly getting it and trying to reduce her (small) education debt + save for future. Best part is that she isn't one of those money hungry bitches.

I'm working on this too.. My girlfriend isn't money hungry per se, but she buys a LOT of stuff she doesn't need. I'm trying to get it through her head, but haven't had much success..

[DsZ24]

Originally Posted by d1

Just curious about trades line of work but are trades people who are earning relatively high incomes making that much because of a lot of over-time work or is their hourly wage just really high?

Once you become a journeyman in certain trades you can make pretty good money. From what I see with alot of companies in the lower mainland there isn't much overtime. Alberta is the place to be to make the big bucks with loads of overtime.

[asian_XL]

last time I heard Canadian average individual annual income is slightly below 40K a year.
It seems all RSers are ballers.

Originally Posted by JKam

I'm also teaching the gf how much it actually costs to live and how we can't spend money on stupid shit. She's slowly getting it and trying to reduce her (small) education debt + save for future. Best part is that she isn't one of those money hungry bitches.

If she's in her early 20s, then it's okay. My fiance, late 20s, still don't get that we need to save up more than we spend on silly shit. I hate what girls like to say "we are still young, enjoy your life as you can."

[conflagrare]

Originally Posted by asian_XL

last time I heard Canadian average individual annual income is slightly below 40K a year.
It seems all RSers are ballers.

maybe a bit. But it's probably more likely the poorer ones are not speaking up.

[Jegz]

Why the fuck is everyone so BALLING here

[Over9K]

^^ Yea, I was gonna say that too...

I guess it must be an asian thing.

Seriously, how are some of you 20 year olds making so much? When I was in my early twenties I took Mechanical Engineering and that shit got me NOWHERE.