tag:blogger.com,1999:blog-22955634.post2656608763577116517..comments2023-11-02T09:05:19.827-04:00Comments on Growth in Value: Darts and laurelsGIVhttp://www.blogger.com/profile/00696914649890834002noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-22955634.post-83619459954863284732008-06-26T20:20:00.000-04:002008-06-26T20:20:00.000-04:00Robyn's piece was kind of scary to read."My monthl...Robyn's piece was kind of scary to read.<BR/><BR/>"<I>My monthly payments are the same price as my rent... I might keep the place and rent it out to Ryerson students</I>" How does it make sense to rent it out if the rent barely covers the monthly payments? Does she not realize that there may be other costs to being a landlord?<BR/><BR/>"<I>I hope to sell in five or so years... I plan on making money through appreciation...</I>" And how much appreciation, exactly, is she <B>planning</B> on? If her closing costs are around 10%, then she's got to make 2% per year just to break even after 5 years. Historically not too much of a challenge, but:<BR/><BR/>"<I>But if a home isn't worth gambling over, what is?</I>" It is a gamble... and one shouldn't put more money into a single investment than one is prepared to lose. She can't help but have seen the US housing market melt down over the last year, and so many people are calling for the market up here to stagnate or even decline...<BR/><BR/>She seemed to get a place that she can afford, and enjoys being an owner, which is good... but I don't get the impression at all from her articles that she put much deep consideration into one of the biggest purchases of her life, or that she really understands the financial aspects. She doesn't seem to appreciate that owning carries some risks that renting doesn't (it's her fridge now... and she has to pay to fix it if it breaks; she also needs all kinds of insurance that she didn't have to pay for as a renter).<BR/><BR/>"<I>If I lose my job, or fall on hard times, I won't need to stress any more than if I was renting.</I>" Does that make sense to anyone besides her? Sure, the monthly payments might be the same (and again: kudos for her in that regard at least and not completely overbuying), but if she falls on hard times she can move out of a rental into a cheaper rental with 60 days notice, and have her savings to fall back on. She's implied that now all of her savings are in the condo, so if she falls on hard times she's got no savings, is stuck at the same monthly payment until she can sell it (unless she rents it out and moves in with mom), and then if things go really poorly in the housing market, she could be underwater on the mortgage to boot.<BR/><BR/>And there are countless other amateur condo speculators out there who are even less contemplative than Robyn...Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-22955634.post-28930404711123204052008-06-13T00:54:00.000-04:002008-06-13T00:54:00.000-04:00Congrats on your mentions, its always most fun to ...Congrats on your mentions, its always most fun to be the villain :-).<BR/><BR/>Robyn is cute! Put her in touch with me if she ever kicks her scowling, ice-cream eating, small-dog-sitting-next-to boyfriend to the curb. ;-)John Champaignhttps://www.blogger.com/profile/14502724381002990745noreply@blogger.com