Personal Finance

Impossible to own a house, start a family, and save for retirement in Vancouver. What should we do? 30 yo, 100K combined

  • Last Updated:
  • Nov 19th, 2017 7:06 pm
[OP]
Newbie
Oct 21, 2009
37 posts
3 upvotes

Impossible to own a house, start a family, and save for retirement in Vancouver. What should we do? 30 yo, 100K combined

My wife and I are 30 years old with a combined income of $100K. We rent a 1 bedroom apartment in Kitsilano for $2000 per month and save approximately $1500 each month. Our combined savings is approximately $100K.

We want to buy a place and start a family. Since a two bedroom in Vancouver starts at 1 million we would need to double our income so that's out of the question.

With our income we can afford a $500K place, which would mean moving 30 minutes outside of the city for two bedrooms.
Also, a 20% down payment would eat up our entire savings ($100K) and the $1500 per month that we are currently saving would have to go towards the extra cost of mortgage and of raising the kid(s).

Sacrificing our entire retirement fund in order to start a family seems risky and we enjoy living in Vancouver but we also want to be property owners and have children.

What would you do in our situation?
92 replies
Deal Addict
Nov 2, 2013
4803 posts
902 upvotes
Edmonton, AB
Move. A home in Vancouver is a lifestyle choice. If home ownership is your goal, and you want to continue living in the area, then most go east to find a more affordable home. Some go northward to Squamish, but don't imagine it being much more affordable there, being close to water. If you go an hour out east that same 2br for $1M becomes more like $600,000, though it depends on where exactly you go.

Coquitlam is a very popular choice for those who can't afford to live in Vancouver, though housing is not cheap either. You're still easily well into the $400-500s+ per sq ft., more for detached homes... for detached homes, around the $1M mark are "handyman special" homes built in the 1970s. You may be forced to actually go towards Maple Ridge if you want your 2 br+ for <$500,000.

Personally I opted to work in another province where I'm better compensated for my work and living costs are lower. Those 2 factors combined have let me save a lot more money to invest and grow with... If I stayed in the GVA, I'd have none of my assets today. Plus with the higher cashflow I am a lot less stressed and live a more balanced lifestyle.
Last edited by FirstGear on Nov 12th, 2017 7:08 pm, edited 3 times in total.
Deal Addict
Jan 2, 2015
1117 posts
258 upvotes
Toronto, ON
Unfortunately you can't really do both. Modern life isn't set up for it. There are studies suggesting people are having fewer children because they can't get places with enough bedrooms. Other people buy houses anyway and have terrible retirements. You can admonish people to put money into their RRSP, but it's hard to do that if they have no spare money, or see the house as an investment.

Your family could compromise on a two or even three bedroom apartment (which are hard to find, unfortunately), but that will still cost you the dream of home ownership. So I guess the real question is... why do you want to own property? You could literally rent a house if you want a backyard.
Sr. Member
User avatar
Sep 19, 2013
944 posts
268 upvotes
Winnipeg
ttrevor wrote:
Nov 12th, 2017 6:09 pm
We want to buy a place and start a family. ......
.....
Sacrificing our entire retirement fund in order to start a family seems risky and we .....
Let me get your biology straight here, you dont need your own place to start a family...Winking Face

On a serious note though, you dont need your own place to start a family...
Once you delink that dependency, you'll be in a better position to make decisions. Just give a thought to starting a family while renting and possibly owning a place at a later stage. Essentially deferring the decision to own a place. All the best.
Deal Addict
Feb 9, 2009
4486 posts
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FoFai2015 wrote:
Nov 12th, 2017 7:12 pm
Unfortunately you can't really do both. Modern life isn't set up for it. There are studies suggesting people are having fewer children because they can't get places with enough bedrooms. Other people buy houses anyway and have terrible retirements. You can admonish people to put money into their RRSP, but it's hard to do that if they have no spare money, or see the house as an investment.

Your family could compromise on a two or even three bedroom apartment (which are hard to find, unfortunately), but that will still cost you the dream of home ownership. So I guess the real question is... why do you want to own property? You could literally rent a house if you want a backyard.
LOL first time I heard that one but I guess it makes sense -- most people dont have kids these days cause of lifestyle -- they wanna travel, go out, etc and not deal with kids or people with heavy careers who dont have time to spend enough quality time with them or cant have kids for health reasons or they are just so damn expensive now.
Sr. Member
Jan 9, 2011
904 posts
476 upvotes
Vancouver
Apply to housing co-ops. We spent four years on the waiting list until we were able to get in. We now have an affordable place to live in the city, enough bedrooms for the whole family, and the same security of tenure that home owners have. It's the only way we could do it. And everyone who lives here actually lives here and is invested in the community—no absentee owners, no AirBnB, no transient tenants. There's no better place I can think of to raise a family.

Yes we have foregone home ownership, but for us it has been worth it. We can afford to put money away for retirement that we would never have had, if we had tried to buy into this overpriced market.
Deal Addict
User avatar
Feb 19, 2010
4656 posts
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Is this a trick question? :eek:

FirstGear answered in the first word of the first response. Move. Why do you think you need to be in Vancouver?
Deal Addict
Jun 20, 2011
1403 posts
401 upvotes
VANCOUVER
Sanyo wrote:
Nov 12th, 2017 10:12 pm
LOL first time I heard that one but I guess it makes sense -- most people dont have kids these days cause of lifestyle -- they wanna travel, go out, etc and not deal with kids or people with heavy careers who dont have time to spend enough quality time with them or cant have kids for health reasons or they are just so damn expensive now.
I had a friend exactly like this. Both wife and him didn't want kids because of their lifestyle. I see them flying around the world, eating out, etc. Fast forward 12 years and they've been trying to have their first kid with no luck...
Deal Addict
Jun 20, 2011
1403 posts
401 upvotes
VANCOUVER
ttrevor wrote:
Nov 12th, 2017 6:09 pm
My wife and I are 30 years old with a combined income of $100K. We rent a 1 bedroom apartment in Kitsilano for $2000 per month and save approximately $1500 each month. Our combined savings is approximately $100K.

We want to buy a place and start a family. Since a two bedroom in Vancouver starts at 1 million we would need to double our income so that's out of the question.

With our income we can afford a $500K place, which would mean moving 30 minutes outside of the city for two bedrooms.
Also, a 20% down payment would eat up our entire savings ($100K) and the $1500 per month that we are currently saving would have to go towards the extra cost of mortgage and of raising the kid(s).

Sacrificing our entire retirement fund in order to start a family seems risky and we enjoy living in Vancouver but we also want to be property owners and have children.

What would you do in our situation?
Perhaps look at your wants and needs and see if you can up those monthly savings. Moving out of Vancouver and into Poco, Port Moody, Surrey is not the end of the world. I heard the skytrain is convenient if you are close to a station. If you don't buy, do you really need to live in Kits for 2k a month?
Member
Feb 27, 2014
280 posts
38 upvotes
ttrevor wrote:
Nov 12th, 2017 6:09 pm
My wife and I are 30 years old with a combined income of $100K. We rent a 1 bedroom apartment in Kitsilano for $2000 per month and save approximately $1500 each month. Our combined savings is approximately $100K.

We want to buy a place and start a family. Since a two bedroom in Vancouver starts at 1 million we would need to double our income so that's out of the question.

With our income we can afford a $500K place, which would mean moving 30 minutes outside of the city for two bedrooms.
Also, a 20% down payment would eat up our entire savings ($100K) and the $1500 per month that we are currently saving would have to go towards the extra cost of mortgage and of raising the kid(s).

Sacrificing our entire retirement fund in order to start a family seems risky and we enjoy living in Vancouver but we also want to be property owners and have children.

What would you do in our situation?
Combined income of $100K is common, with many couples making that kind of money, that will drive up the prices as demand exceed supply.

Start small. You don't need to buy a house or a brand new condo. Understandably, if you work in Vancouver, your home is ideally in Vancouver for ease of commute. It is not fun to have a one or two hour drive/transit to get home from work.

Start small with a condo in the resale market. In Vancouver there are 2-bedroom resale condos that lists under $500,000 (see photo). Check out the resale market weekly and you will find something. After a few years, you can then upgrade to a "newer" condo or even a house if such opportunity exists.

http://www.realtor.ca/

Image
Sr. Member
Nov 13, 2013
714 posts
245 upvotes
OTTAWA
ttrevor wrote:
Nov 12th, 2017 6:09 pm
My wife and I are 30 years old with a combined income of $100K. We rent a 1 bedroom apartment in Kitsilano for $2000 per month and save approximately $1500 each month. Our combined savings is approximately $100K.

We want to buy a place and start a family. Since a two bedroom in Vancouver starts at 1 million we would need to double our income so that's out of the question.

With our income we can afford a $500K place, which would mean moving 30 minutes outside of the city for two bedrooms.
Also, a 20% down payment would eat up our entire savings ($100K) and the $1500 per month that we are currently saving would have to go towards the extra cost of mortgage and of raising the kid(s).

Sacrificing our entire retirement fund in order to start a family seems risky and we enjoy living in Vancouver but we also want to be property owners and have children.

What would you do in our situation?
Moving of course is the obvious answer. I think you guys could actually make it in Vancouver. You both must be savers to have saved that much money on that low an income. This will never change even if you have kids. This means you can stretch if you want to. I guess you are still looking at either 30 minutes out as you say in which case why even live in Vancouver or an apartment style condo. Most of the world raises kids in apartments. I have friends who do it by choice even though they could afford houses. They seem happy. Maybe with older kids it might get tougher.

Are your careers easily transferable? Basically every city in Canada has better income to property price ratios than Vancouver. Ottawa, Calgary and Edmonton are especially good.
Deal Addict
Jun 29, 2007
3669 posts
799 upvotes
ttrevor wrote:
Nov 12th, 2017 6:09 pm
My wife and I are 30 years old with a combined income of $100K. We rent a 1 bedroom apartment in Kitsilano for $2000 per month and save approximately $1500 each month. Our combined savings is approximately $100K.

We want to buy a place and start a family. Since a two bedroom in Vancouver starts at 1 million we would need to double our income so that's out of the question.

With our income we can afford a $500K place, which would mean moving 30 minutes outside of the city for two bedrooms.
Also, a 20% down payment would eat up our entire savings ($100K) and the $1500 per month that we are currently saving would have to go towards the extra cost of mortgage and of raising the kid(s).

Sacrificing our entire retirement fund in order to start a family seems risky and we enjoy living in Vancouver but we also want to be property owners and have children.

What would you do in our situation?
Different strokes for different folks.

It all depends on what your priorities are.

For me, I am quite well off (I own multiple houses) but I don't feel I can afford to live in Kitsilano. We also drive a 4.5 yr old Hyundai and a 14 yr old Toyota.

There are lots of people renting and driving a nicer car than me.

One time I was showing my rental suite to a potential renter and he came in a newer bmw while I came in a 15 yr old car.
[OP]
Newbie
Oct 21, 2009
37 posts
3 upvotes
Thanks for the replies.

Just to clarify, we are happy to own an apartment or condo rather than a house. Sorry for any confusion.

I understand that moving away from the city is our best option.
However, the problem remains that even a 2 bedroom condo or apartment 30 minutes outside Vancouver will cost $500K with a $100K down payment and $3K+ mortgage. This, combined with child costs will eat up all of our current and future savings.

It just feels like it's impossible to own, start a family AND save for retirement ANYWHERE in the lower mainland.
Deal Addict
Jun 20, 2011
1403 posts
401 upvotes
VANCOUVER
ttrevor wrote:
Nov 13th, 2017 2:03 am
Thanks for the replies.

Just to clarify, we are happy to own an apartment or condo rather than a house. Sorry for any confusion.

I understand that moving away from the city is our best option.
However, the problem remains that even a 2 bedroom condo or apartment 30 minutes outside Vancouver will cost $500K with a $100K down payment and $3K+ mortgage. This, combined with child costs will eat up all of our current and future savings.

It just feels like it's impossible to start a family AND save for retirement ANYWHERE in the lower mainland.
A 400k mortgage will not be 3 grand a month... More like 1500 - 1600 as a guestimate plus a strata fee of say 325 - 350 bucks.
Sr. Member
Jan 9, 2011
904 posts
476 upvotes
Vancouver
DDHLeigh wrote:
Nov 13th, 2017 2:26 am
A 400k mortgage will not be 3 grand a month... More like 1500 - 1600 as a guestimate plus a strata fee of say 325 - 350 bucks.
Assuming a 25 year mortgage, you'd need an annual interest rate of about 1.5% that never goes up for 25 years, to be paying a $1600 monthly payment on a $400k mortgage. Good luck with that.

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