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Back in my 20s, I considered my first home as part of my retirement savings plan - where my investment could grow in value free of tax consequences. Over the years I invested as much money as I could spare in prepayments and continued to do so with later homes I bought. Then when I no longer had a mortgage, the home became my financial safety net.
Perhaps people who prefer to rent aren’t as focused on long term financial goals?
I know that if I had discovered in my 30s or 40s that I was about die, I would probably have regretted not spending more of my money just to live life. However, that didn’t happen, so I reap the benefits now of my early decision to invest. I took early retirement at age 53.
Lots of people try to pay down their mortgages quickly and hope their homes might be a safety net for them after they retire, me included. So, to an extent, I obviously understand this side of the argument.
But it's your suggestion that people who choose to rent "aren't as focused on long-term financial goals" that exemplies the all-or-nothing home owning culture in Canada I'm talking about.
It implies that non homeowners are financially irresponsible and/or shortsighted, which in itself is a limited, short sighted view. Are we really to assume that 60% of Montréalers and more than 40% of Québecers, overall, and that most Germans, Swiss, and Austrians "aren't focused on their long-term financial goals"? I find that notion hard to believe.
It doesn't seem to consider that there ARE other very legitimate --and lucrative -- alternatives to home ownership to ensure one's financial stability, both short and long-term. There are plenty of people who, for whatever reason(s) rent and invest their money in other ways. That's what lots of New Yorkers, for example, do.
I have a friend here in Nashville who grew up in the Northern New Jersey/NYC area. He retired early at around 51. He rents an apartment and says he's never had an interest in owning a home. But he's big into the stock market, which he's very knowledgeabe about, and will likely enjoy a continued financially stable retirement.
A coworker, a former lifelong New Yorker, also has never owned a home and has never really thought about it. But she socks money away like crazy into her 401k and IRAs, and enjoys her life with lots of travel (I think she's also into the stock market). I don't doubt that she, too, will be very comfortable after she retires.
My point is, there are all kinds of ways that smart, responsible, financially conscious people choose to live, and those ways don't always include -- and don't HAVE to include -- owning a home.
Lots of people try to pay down their mortgages quickly and hope their homes might be a safety net for them after they retire, me included. So, to an extent, I obviously understand this side of the argument.
But it's your suggestion that people who choose to rent "aren't as focused on long-term financial goals" that exemplies the all-or-nothing home owning culture in Canada I'm talking about.
It implies that non homeowners are financially irresponsible and/or shortsighted, which in itself is a limited, short sighted view. Are we really to assume that 60% of Montréalers and more than 40% of Québecers, overall, and that most Germans, Swiss, and Austrians "aren't focused on their long-term financial goals"? I find that notion hard to believe.
It doesn't seem to consider that there ARE other very legitimate --and lucrative -- alternatives to home ownership to ensure one's financial stability, both short and long-term. There are plenty of people who, for whatever reason(s) rent and invest their money in other ways. That's what lots of New Yorkers, for example, do.
I have a friend here in Nashville who grew up in the Northern New Jersey/NYC area. He retired early at around 51. He rents an apartment and says he's never had an interest in owning a home. But he's big into the stock market, which he's very knowledgeabe about, and will likely enjoy a continued financially stable retirement.
A coworker, a former lifelong New Yorker, also has never owned a home and has never really thought about it. But she socks money away like crazy into her 401k and IRAs, and enjoys her life with lots of travel (I think she's also into the stock market). I don't doubt that she, too, will be very comfortable after she retires.
My point is, there are all kinds of ways that smart, responsible, financially conscious people choose to live, and those ways don't always include -- and don't HAVE to include -- owning a home.
Why so defensive? Where in my post did I say the renters were financially irresponsible and don’t plan for retirement? I implied that they might have different priorities regarding how they used their excess cash. Different people choose a different balance between “enjoy now” or “enjoy later”. There is no right balance or wrong balance unless financial difficulty results.
I was first confronted with a decision between “enjoy now” or “enjoy later” when I was about 4 years old and received my very first allowance. I learned over time than “anticipation” was in itself something to enjoy. The more I saved, the more money I had to buy something I really wanted and I valued it more because it wasn’t just given to me. That learned behavior carried over into adulthood.
Why so defensive? Where in my post did I say the renters were financially irresponsible and don’t plan for retirement? I implied that they might have different priorities regarding how they used their excess cash. Different people choose a different balance between “enjoy now” or “enjoy later”. There is no right balance or wrong balance unless financial difficulty results.
I was first confronted with a decision between “enjoy now” or “enjoy later” when I was about 4 years old and received my very first allowance. I learned over time than “anticipation” was in itself something to enjoy. The more I saved, the more money I had to buy something I really wanted. That learned behavior carried over into adulthood.
I didn't mean to sound defensive, and I apologize if I did. What I say isn't directed at you, per se, anyway.
But I do find many Canadians to be absolutist in their views on home ownership, and I get the impression from some friends and family in Canada that they consider renters "undesirables." It really is a strange way of thinking.
Last edited by newdixiegirl; 06-14-2020 at 11:40 AM..
I didn't mean to sound defensive, and I apologize if I did. What I say isn't directed at you, per se, anyway.
But I do find many Canadians to be absolutist in their views on home ownership, and I get the impression from some friends and family in Canada that they consider renters "undesirables." It really is a strange way of thinking.
Why care what strangers think if they don’t affect your life? I certainly don’t.
Why cares what strangers think if they don’t affect your life?
It's not about it affecting my life. At this point in time, I choose to be a homeowner. It's that I find it an incredibly myopic way of thinking. We all find certain views off-putting, regardless of whether or not they affect us.
It's not about it affecting my life. At this point in time, I choose to be a homeowner. It's that I find it an incredibly myopic way of thinking. We all find certain views off-putting, regardless of whether or not they affect us.
Well, they may have had bad personal experiences living beside a renter. You can’t expect a temporary renter to spend time and money upkeeping a property the way an owner would.
I'm not talking only about SFHs. Surely you know that condos in most Canadian cities are unbelievably expensive, as well? And of course I know that not everyone wants a SFH. I currently live happily in a townhome. And I bought it only because rent for a 3-bed, 2.5 bath townhome in a nice, green area would easily be quadruple what my mortgage is.
St. Catharines, Ontario is "more desirable" than where? Regina, Saskatchewan is " more desirable" than where? That can be very subjective. Nashville is pretty expensive, but more affordable than my hometown of Hamilton, Ontario, if comparing apples with apples. For me, Nashville is far more desirable.
We are talking about home prices in general. I never said everyone wants a SFH, in fact I said the opposite in my post
Not sure why you are questioning more desirable? Cities and towns, have certain things that in general most people find desirable. Jobs, lifestyle, safety, and to a degree weather. Cites grow because more people find what they desire in certain cities. Hence, less space, and more expensive real estate. So in that context, NYC within the US, is more desirable to more people than Nashville. In Canada, Vancouver is more desirable than Regina.
Condos in Vancouver, Toronto, and less so Montreal are expensive. Just like they are in LA, San Fran, Chicago, NYC...you know, places that are growing and demand is there. Marketplace at work. Condo's in Regina...depends..you can still buy one for $100,000
Yes, home ownership rates in Canada are slightly higher than in the US, and they have been for quite a while.
But, as I said, home ownership, whether in Canada or the US (but moreso in Canada), is largely cultural, and not necessarily an indication of economic "success."
The fact that you mention it, presumably as an edge that Canada has, is a reflection of the very culture I'm talking about. It's a mindset more than an outcome of economic factors. In some parts of Canada, a (big) house is a status symbol, not simply a place to live, that people go into incredible levels of debt for.
In contrast to most Canadian cities, something like 60-70% of Montréalers rent (when I lived there as a teen, that rate was 85% - in the 80s, no less, when homes were extremely affordable to buy because there was still an exodus out of Québec).
Is that because Montréalers are less able to afford a home than say, Vancouverites or Calgarians or Hamiltonians? Not at all. Montréal still has a relatively affordable housing market within the Canadian context. It's cultural. Montréalers choose to rent because they're more far more relaxed about it. They don't consider themselves failures if they don't own a home.
Ultimately, i've found there isn't the same stigma to renting in the US as there is in Canada. If there were, most New Yorkers, including highly paid, highly educated ones, would hang their heads in shame.
This difference in attitudes might account for lower home ownership rates in the US even though housing, with the exception of coastal cities, is more affordable. And it also might help to explain the unbelievably high cost of housing throughout most of Canada.
You are putting words into my mouth. I never said home ownership was a sign of success. That is coming from within you. I mentioned the percentage of home ownership in a discussion about home prices, to show that home prices in Canada can't be that onerous on Canadians since home ownership is higher than in the US and delinquency rates much lower.
I think every country where people can buy, have some people buying or building houses for show. In Canada for people who can't afford it, I'd say they have a much less chance of doing that since the banks are very strict.
I know no one who considers someone a failure because they don't own. I rented for years and never felt any stigma. Some people are proud that they have bought a home, but that doesn't mean the begrudge renters. EDIT: On that note, there are whole neighbourhoods in Vancouver that are filled with rental buildings and high-rises. The West End, which only in the last few years started getting condo's, was nearly 100 percent rentals. 55,000 people lived there when I did. Hardly stigmatized.
As for Montreal, my guess for the reason for so many renters, was the rent. Montreal was DIRT cheap to rent, especially compared to Toronto and Vancouver. One reason I bought was because my mortgage payments were almost the same as renting. It was a no brainer in my case, and many others in Vancouver at that time.
I don't think it's some sort of mystical cultural " not ashamed of being a renter " Quebecois kind of thing. Again, it's the market. People are going to buy when it makes sense for them to do so, and rent when it makes sense.
I think the way disposable income may be calculated, makes it look like Canadians have less?? Just guessing, because, I agree, I don't see much if any difference in real life.
Well, keep in mind that Canada does have significantly higher income taxes than even California, BUT, BUT, BUT...
Five years ago, the difference wasn't so drastic. It was in these past five years that Trudeau raised federal taxes and Trump cut federal taxes. And you know, federal taxes in America, at least, are basically 75% of the amount of income taxes you pay. Five years ago, top marginal tax rates in Alberta were the same as they were in Louisiana.
" As recently as the summer of 2015, Alberta’s
combined marginal tax rate at CA$300,000 was just 39.00 percent—the
same rate as Louisiana at that time."
You are putting words into my mouth. I never said home ownership was a sign of success. That is coming from within you. I mentioned the percentage of home ownership in a discussion about home prices, to show that home prices in Canada can't be that onerous on Canadians since home ownership is higher than in the US and delinquency rates much lower.
I think every country where people can buy, have some people buying or building houses for show. In Canada for people who can't afford it, I'd say they have a much less chance of doing that since the banks are very strict.
I know no one who considers someone a failure because they don't own. I rented for years and never felt any stigma. Some people are proud that they have bought a home, but that doesn't mean the begrudge renters.
As for Montreal, my guess for the reason for so many renters, was the rent. Montreal was DIRT cheap to rent, especially compared to Toronto and Vancouver. One reason I bought was because my mortgage payments were almost the same as renting. It was a no brainer in my case, and many others in Vancouver at that time.
I don't think it's some sort of mystical cultural " not ashamed of being a renter " Quebecois kind of thing. Again, it's the market. People are going to buy when it makes sense for them to do so, and rent when it makes sense.
That's what I think too. People rent when it makes financial sense to do so. Thinking of one of my nieces in particular, she went to university right out of high school, worked very hard and got a degree in social work, decided after a year or so it was impossible to make a living at it, went back to school to become a registered nurse and in all that time never travelled to speak of and now she travels everywhere. She's still under 30. She and her husband bought a new condo just outside of Winnipeg for under 200,000. I don't think you can compare her situation to someone in Toronto or Vancouver. If she lived there, she'd probably be renting.
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