Why can’t the renter afford to buy a home? It only costs at most $100,000 to build a house in material and labour costs. That’s a downpayment of a $10,000 and mortgage payments would be less than $1000, far far lower than the prospect of paying rent for years while you save for a $100,000 downpayment.
But guess what, the price of housing isn’t just material and labour plus the competition of people who need homes, it’s also filled with landlords who are buying up the supply to make money renting the houses back.
Like I said, it’s literally a limited resource and instead of making sure everyone can afford a basic necessity of survival, landlords use their existing greater money to outbid actual first time home buyers, drive up the cost of housing, and then lease it back to renters who “can’t afford a home”.
Umm did you read the link you sent or do the math provided?
They cite at the low end a cost of $120/square foot, with small houses being around ~1000 square feet that’s $120,000, a completely reasonable mortgage for most middle and lower class people to afford and pretty much exactly in line with my ballpark gut guess.
It only costs at most $100,000 to build a house in material and labour costs.
Where? Seriously… where? Keeping in context and looking at building costs in BC (since Mr. Singh’s house is in Burnaby)… the materials cost to build a 2000 sqft house is more like 3 to 5 times what you guessed. Just the foundation and excavation costs can easily hit $60,000 - $75,000. Add to that the lumber for the flooring alone which can easily exceed $30,000. Just those two things and you’re over your $100,000 guesstimate. And you haven’t accounted for permits, surveying, connections to city utils. The real cost of materials in a home in BC is more like $500,000… to START. Plus you have contractor fees that can easily hit 20% of your materials cost… if not more.
I own a house in BC that we built in 2019… I saw the materials cost… and the costs have gone up a LOT since then. You are way off on your cost of building materials estimate.
Building costs on average range from $120-$260 / square foot in Canada. A small sized starter home is not 2000ft but 1000, which puts us firmly in the $100-200k range, not the $600k they actually sell for at minimum. And this isn’t getting into the fact that once a home is built it will typically be good for many many owners.
That’s still not accounting for foundation costs… contractor rates… and so on. Even with a 1000 sqft home, you’re still going to find youreslef pushing over $200,000 in materials and other costs… then there’s the land value. Lumber costs will make you cry… the wood you use in construction is bloody expensive nowadays. I don’t think that you can honestly get away with $120/sqft…
But taking your price of say… .$200k (I picked the upper end because I think you’re low and using reference data that several years old) in materials cost… add in surveying, foundation, building permits, licenses, services, and the one big expense you’re missing… land to build on… and you’re not going to have a house built (even if you do almost all the work yourself) for $200k.
Yes, I am explaining how landlords are a problematic aspect of the system, I believe you were busy implying that they’re not, would you like to get back to it?
You do realize that whether you rent or own does not change the total number of houses that are occupied, right?
Right
It doesn’t change the supply?
Right
If there weren’t landlords there wouldn’t magically be more houses?
Right
The total number of houses bought and sold wouldn’t change?
Right
Demand wouldn’t change.
Right
Renting versus buying is zero sum in terms of supply.
Right
The cost of houses goes up with inflation and the cost of materials and labour.
Right; but this is the part you’re having trouble with. The cost of houses also increase because people and corporations buy more than they need and offer their now private excess to others at an inflated rate. If they didn’t hoard more than they use and scalp their excess for profit, the cost of houses would be less and more affordable to everybody. It’s literally no different than scalping concert tickets.
Why can’t the renter afford to buy a home? It only costs at most $100,000 to build a house in material and labour costs. That’s a downpayment of a $10,000 and mortgage payments would be less than $1000, far far lower than the prospect of paying rent for years while you save for a $100,000 downpayment.
But guess what, the price of housing isn’t just material and labour plus the competition of people who need homes, it’s also filled with landlords who are buying up the supply to make money renting the houses back.
Like I said, it’s literally a limited resource and instead of making sure everyone can afford a basic necessity of survival, landlords use their existing greater money to outbid actual first time home buyers, drive up the cost of housing, and then lease it back to renters who “can’t afford a home”.
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Umm did you read the link you sent or do the math provided?
They cite at the low end a cost of $120/square foot, with small houses being around ~1000 square feet that’s $120,000, a completely reasonable mortgage for most middle and lower class people to afford and pretty much exactly in line with my ballpark gut guess.
Where? Seriously… where? Keeping in context and looking at building costs in BC (since Mr. Singh’s house is in Burnaby)… the materials cost to build a 2000 sqft house is more like 3 to 5 times what you guessed. Just the foundation and excavation costs can easily hit $60,000 - $75,000. Add to that the lumber for the flooring alone which can easily exceed $30,000. Just those two things and you’re over your $100,000 guesstimate. And you haven’t accounted for permits, surveying, connections to city utils. The real cost of materials in a home in BC is more like $500,000… to START. Plus you have contractor fees that can easily hit 20% of your materials cost… if not more.
I own a house in BC that we built in 2019… I saw the materials cost… and the costs have gone up a LOT since then. You are way off on your cost of building materials estimate.
Building costs on average range from $120-$260 / square foot in Canada. A small sized starter home is not 2000ft but 1000, which puts us firmly in the $100-200k range, not the $600k they actually sell for at minimum. And this isn’t getting into the fact that once a home is built it will typically be good for many many owners.
That’s still not accounting for foundation costs… contractor rates… and so on. Even with a 1000 sqft home, you’re still going to find youreslef pushing over $200,000 in materials and other costs… then there’s the land value. Lumber costs will make you cry… the wood you use in construction is bloody expensive nowadays. I don’t think that you can honestly get away with $120/sqft…
But taking your price of say… .$200k (I picked the upper end because I think you’re low and using reference data that several years old) in materials cost… add in surveying, foundation, building permits, licenses, services, and the one big expense you’re missing… land to build on… and you’re not going to have a house built (even if you do almost all the work yourself) for $200k.
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Congratulations on reading comprehension! We are discussing the current housing system and its flaws! Good job!
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Yes, I am explaining how landlords are a problematic aspect of the system, I believe you were busy implying that they’re not, would you like to get back to it?
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If there were no landlords, there wouldn’t be a supply problem.
Because landlords own the supply and increase the costs of housing everywhere.
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Right
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Right
Right
Right
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Right; but this is the part you’re having trouble with. The cost of houses also increase because people and corporations buy more than they need and offer their now private excess to others at an inflated rate. If they didn’t hoard more than they use and scalp their excess for profit, the cost of houses would be less and more affordable to everybody. It’s literally no different than scalping concert tickets.