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I haven’t been planning to purchase a place here anytime soon, in part because I want to see how I handle this winter.  I’m giving myself full permission to return to Vancouver with my daschunds if we need to thaw out and can’t handle the ongoing cold and snow.

I was minding my own business on Thursday evening, greeting friends via facebook, when the ad appeared on the right.

Never did I think I’d consider a mobile home as a domicile, but, I mean look at those pictures!  In Yellowknife, either because we’ve had lame developers or in combo with difficult conditions (cold, isolation) for building, mobile homes are a-Plenty here and don’t have the connotations of The Boys.

PROS

1. It has the look and feel, nearly precisely, that I would want

  • laminate
  • wood stove
  • soaker tub
  • warm wood and white walls
  • crown moulding
  • stainless steel appliances (oh, to have a dishwasher again.  handwashing begone!)
  • yard that does not require upkeep
  • special bonuses:  the entertainment system (on my to-buy list, right down to the Bose audio system) and the persian rug runner down the length.  Seriously, it’s so.totally.me.
  • 1.5 minutes away from Yellowknife’s best trail and lake
  • close to the Co-op where I shop

2.  The monthly payments are only a couple hundred more than I’m paying for rent

3.  Unlike many people, I’m still gloomy about the long-term prognosis for the economy, and have been debating investing in real estate rather than stocks.  My hunch is that the north is going to continue to quietly boom and that real estate here is a good investment.

4.  I’ll verify this with an inspection (only 1 inspector up here apparently!  grrrrr) but it appears to be in good condition, including a 2007 furnace, a new fibreglass oil tank, and some kind of relatively new pvc (?) piping = not as likely to freeze.

5.  I estimate that in 3 years I’ll have built up about $20K in equity.

6.  It’s affordable.

CONS

1.  I hadn’t planned on this, at least right now, and don’t want to be rushed on at $250K choice.  The deadline, for reasons I won’t go into, is Tuesday (day after tomorrow).

2.  I’m not sure I can pull all my various funds together in time to get my down payment.

3.  The ceiling is rather low.

4.  I don’t know the market up here very well yet.   I suspect mobile homes don’t appreciate the way stick-built do.

5.  One huge, major issue.   The condo corp. is responsible for the roads and pipes and apparently they are well past the due-date for replacement, but the corp does not have the, oh, $20M or so needed.   Each person on the strata could well be on the hook for up to $50K, although then the equity would be higher as well – plus, their may be some federal funding available.

6.  My monthly costs will go up because I’ll now be paying heat, hot water and internet (currently included in my rent)

6.  And last, I’m just not sure I want to commit to a place yet.

Thanks to the fabulous Realtor in Vancouver, Urbanista, for some really great pointers on the real estate angle (like, lenders look at mobile homes differently).

Readers, any comments?  Ideas?  Objective thoughts? YIIIIKKKES! 😉

Squawkfox? Krystal? Canajun Finance? Four Pillars? – opinions?

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About the Author


Imagine if Canadians were known for being all over their money. Engaged. Proactive. Getting out of debt. Savvy. Saving. Generous. Nancy wants to help. Nancy started her own journey with money over 15 years ago, and formed her company “Your Money by Design” in 2004 to help others along the same path. It’s not the usual financial advising/investment stuff. It’s about taking control of day-to-day finances –managing monthly cashflow effectively, spending appropriately, getting out of debt, saving. If you're ready to take control over your finances, pop by her business site, YourMoneybyDesign.com

13 Comments

  1. I shouldn’t stereotype to begin with, but that house look absolutely gorgeous inside considering where it is located.
    .-= Kyle´s last blog ..First iPhone Video – Driving Down the Highway =-.

    [Reply]

    Aug 09, 2009
  2. Not sure if you were hoping for Mike’s opinion more than mine, but I’d pass on this if I were you. Often when you get into a new market, you come across a deal that seems amazing. It’s probably a pretty typical deal, and learning the market will help you find something even better.

    A mobile home for $250K (+ a possible additional $50k at some point in the future) seems crazy expensive to me. I don’t think you’ll get ANY appreciation out of a mobile home (maybe a bit out of the land underneath it, but this would be balanced by the depreciation of the home – a future buyer may want to keep the land and install a new home).

    I’d use this as your first data point, let the Tuesday deadline pass (rushing to meet a seller deadline is rarely in a buyer’s interest) and keep looking at other places. I guarantee you’ll find something else as good or better (and if you don’t, I owe you a Coke! ;-).

    If you move into a mobile home any chance you’ll go on Jerry Springer? 😉
    .-= Mr. Cheap´s last blog ..Manulife Dividend Cut and Links =-.

    [Reply]

    Aug 09, 2009
  3. Don’t do it! I’ve fallen in love with houses before and it’s easy to do!

    If you around at enough houses/trailers whatever you’ll realize that there are lots available and whatever makes this place your dream domicile will be available a month from now or a year from now etc.

    I also wouldn’t just consider the rent vs mortgage – you also have property taxes, maintenance plus you’ll want to spend more money on renos if you own it.

    Plus if you aren’t sure how long you are staying there then just rent.
    .-= Four Pillars´s last blog ..Manulife Dividend Cut and Links =-.

    [Reply]

    Aug 09, 2009
  4. jennifer inch

    Hi Nancy – I responded on FB…agree with not rushing, and you should investigate infrastructure issue carefully. BUT, mobile homes here DO appreciate. Ours on School Draw increased 100K in 4 yrs. Partly market spike, of course., but still. These aren’t ‘trailer parks’ up here. 50% of the town is mobile/modular due to building costs.
    cheers, and happy hunting – or scoping, until you’re sure you want to stay. (Hope you do!)
    JJI

    [Reply]

    Aug 09, 2009
  5. There are many, many things to consider, but I have to say that prices for mobile homes in Yellowknife are indeed mind-blowing if you’re used to the prices anywhere else. (Actually, you could say that about ALL homes in Yellowknife, but it’s especially obvious for trailers.)

    They do appreciate. In the six years I’ve been here, I’ve seen the going prices skyrocket. Right now, we’re in a bit of a slump: prices are lower than they were last year.

    I don’t like the idea of rushing to meet a deadline that was imposed by the seller, though. Your own deadline, sure.

    And you can absolutely trust the inspector. We have passed on two houses because of the reports he gave us. He is worth every penny he charges. Make sure you go with him for the inspection. When we started to renovate our house (a trailer!), we had him over for a consultation.
    .-= Megan´s last blog ..Overheard =-.

    [Reply]

    Aug 09, 2009
  6. Thanks for the shout out! The place looks gorgeous. In BC it is possible to arrange that the seller hold back some money from the transaction in trust for work that has to be done. There is usually a time frame on the “hold back.” The fact that there is going to be a $50,000 K assessment sometime in the future should be reflected in the price.

    Good Luck and Happy Decision Making!!

    [Reply]

    Aug 09, 2009
  7. “look and feel” is something that you can create for yourself – it is not intrinsic to the property. Don’t be suckered in by BOSE sound systems and persian runners

    Do the math carefully – its not just the monthly payments vs rent

    Discount the idea of building up equity, since prices can go down as well as up

    Know more about the local market first and don’t be rushed into a decision

    And here I am giving advice to a money coach!
    .-= Stephen Rees´s last blog ..Richmond: Bike lane experiment begins =-.

    [Reply]

    Aug 09, 2009
  8. I’m with Four Pillars and Mr. Cheap on this one. I’d pass for all the reasons they’ve mentioned. Besides, don’t you still own a condo in Vancouver? Who needs all that risk with so much moolah tied up in real estate especially since you’re iffy on staying in Yellowknife. Keep life simple and flexible while you live there and give yourself the option to MOVE BACK TO BC without being held back by needing to sell a mobile. It’s less expensive to move to another apartment if you’re lusting for laminate. My 2cents. 🙂
    .-= Squawkfox´s last blog ..July Roundup: The Buck Stops Here Edition =-.

    [Reply]

    Aug 09, 2009
  9. Warren

    Nice looking place, but in 2019 it will look so 2009.

    I’m with the majority here. Also, interest rates are dirt cheap right now and will not likely stay that way. When crunching your numbers, make sure it works for you if rates were to climb a couple of points.

    Good luck on making your decision.

    [Reply]

    Aug 09, 2009
  10. Being a southcoast person who lived through several winters (in Prince George, more daylight than in Yellowknife!!) I would wait until you know you want to stay there AND you know the market better. But that is the prettiest darn mobile home I have ever seen!!! And I understand, I fall in love at first sight with real estate all the time 🙂
    .-= Wooly Woman´s last blog ..Birthstory =-.

    [Reply]

    Aug 10, 2009
  11. It’s easy to fall in love quick and hard, but when it comes to real estate and big ticket purchases, move with the speed that makes you feel comfortable and that you can stand.

    I’m not living in Yellowknife so I can’t really comment 🙂

    C8j
    .-= Big Cajun Man´s last blog ..Computer Virus Scan is it a Scam? =-.

    [Reply]

    Aug 17, 2009
  12. I’m way late since you already made your decision. Nonetheless, I can’t pass on an opportunity to pimp my own site 😉

    I was discussing (yes, again) the whole rent-vs-buy issue and reminding people that you’ve got to take into account all the factors when making that decision. So if “a few hundred more a month” to buy is say $300, and then another say $250 for the utilities that were included in your rent, then you would also build $20k in equity over 3 years if you saved the difference while renting… and you wouldn’t have the transaction fees or put yourself at the mercy of the prime rate! Of course, it doesn’t sound like this is quite an apples-to-apples comparison (it sounds like the potential buy was nicer than your rental from all the pros you listed, which isn’t too surprising since the market in Yellowknife shouldn’t be as overheated as Toronto or Vancouver)… but still, good to take all the factors into account, and not rush into things!

    For Yellowknife I think the reason there are a lot of pre-fabs is that the permafrost/ground doesn’t lend itself to excavation/basement foundations, though I don’t know if by “mobile home” you mean prefabs, or homes that actually have wheels on them.

    [Reply]

    Aug 19, 2009

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