The war on stuff

– Stephanie McCombie, @ifitwags

When a bunch of people who live in pricey digs on the tony side of Vancouver protested the other day, the moisters were aghast. The homeowners were outraged at a new uber-property tax on houses that have soared to more than $4 million in value. After all, they didn’t force the real estate market into orbit. That just happened. So why should they have to hand over a bunch of cash?

The kids saw it differently. Old, greedy rich people being whiny. When they have so much, why shouldn’t they pay extra? How is that not fair?

The wealth divide is a big topic these days. Wealthy people are getting moreso. Wage gains for the rest of society have sucked. So household debt in Canada has soared to over $2 trillion – people have been borrowing what they don’t have to get what they want. Now rates are rising and folks are pissed. Not going well.

A CBC poll just found 86% of BCers think society is divided along economic lines and 90% of those link their concern to housing. In that society, real estate = wealth. You can have $4 million in a liquid portfolio turning out $300,000 in low-taxed income and nobody cares. But move into a $4 million house producing no income, and you’re a social pariah who deserves a tax spanking. Paleo thinking. But it’s spreading among the political class.

Governments moving to the left, supported by a Millennial tidal wave, are thinking more about taxing wealth. After all, what’s left? The Trudeauites brought in a new, higher tax bracket so those making over $230,000 are now in the 53% zone. HST is punishing everywhere. The assault on income and spending is relentless, from gas taxes to health taxes to payroll taxes.

The political answer to demands from the deplorables for ‘equality’ is to nibble away at the savings, investments and assets of those who earned or built them. It’s what motivated Trudeau to slash the TFSA contribution limit from $10,000 back to $5,500 a year, despite it being the most democratic tax avoidance vehicle in the land. It was at the heart of Bill Morneau’s quixotic assault on small businesses, trying to siphon off retained earnings which doctors (for example) had amassed over the years to make up for no pensions. It’s also the motivation for the principal residence registry and the requirement we now face to justify an exemption from capital gains taxation. Governments want to tax stuff – real estate, financial assets making dividends or capital gains, and savings. Hoovering income is not enough. The mob wants more.

At least that’s how they see it in the hoods where dirt is a prized commodity. Nowhere has a government gone further down this road than in BC. Second properties are now heavily taxed in addition to property tax. Ditto for ‘empty’ residences which are often used for business or family purposes. There’s a speculation tax which has nothing to do with speculation, but is levied just for owning a piece of real estate, not for selling it at a profit. And the public approval rate for this is hovering around 90%.

Most worrisome to the people being gouged is that these taxes are retroactive. They apply to real estate that might have been owned for decades, slapped on at current valuations when prices are at an historic high. Most taxes attempt to modify behaviour, but these are just a hit on wealth. They don’t make houses more affordable to the crowd below. They merely confiscate.

That’s perfectly okay with the majority who feel entitled to things they cannot actually afford. The Dipper finance minister in BC has suggested the extra property tax on high-end properties might some day morph into a general wealth tax – which is exactly what folks owning nice houses fear. Tax based on possessions, not income nor the ability to pay, do not have a legacy in Canada. It’s Robin Hood stuff. The law of the forest with jolly green guys in codpieces firing arrows at the baron. Take from the rich, give to the poor.

Wealth taxes are the rage in academia among professors who have tenure, cannot be fired and have life-long defined-benefit pension plans (publicly-funded, so they need not save anything). The eggheads behind the NDP speculation tax have argued that property taxes should be jacked and income taxes reduced. That way the average guy who has saved nothing pockets more disposable income and the person who’s accumulated assets gets to fund it. The incentive to work and spend is increased. The reason to save and invest is destroyed.

So far, it’s a disaster. The empty house tax in Vancouver is costing a fortune to run and has resulted in no new rental units. The speculation tax on second properties has helped start a war with Alberta, and is now riddled with exemptions. Cheap houses cost more and dear ones are still out of reach. But the mob loves it, wants it, craves more of it.

If you like this stuff, you know how to vote. If you don’t, learn a lot more about tax avoidance, get a fat liquid portfolio and go live quietly among the masses.

226 comments ↓

#1 Shawn Allen on 05.08.18 at 5:06 pm

Blessed are the 8%, who owe so much, as they pay massive interest to the 1% and support the income of the wealthy.

The wealthy collect interest from the indebted 8% directly or indirectly as depositors, investors in various mortgage backed securities, bank-issued bonds and bank preferred shares and bank common shares.

(Thank you Stan for reminding me that it’s not only depositors that fund banks but also investors in mortgage backed securities and bank bonds and bank equity. I don’t think that changes my main point that one man’s debt is another man’s savings – or call it another man’s wealth if you prefer.)

#2 Spillover on 05.08.18 at 5:08 pm

You can have $4 million in a liquid portfolio turning out $300,000 in low-taxed income and nobody cares. But move into a $4 million house producing no income, and you’re a social pariah who deserves a tax spanking. Paleo thinking. But it’s spreading among the political class.

————–

Its because real estate continues to be the only asset class that doesn’t have to pay capital gains taxes if you sell your principle residence.

When the owner of the $4 million dollar house sells, they get a tax free windfall. When the owner of the $4 million portfolio sells, they get a huge capital gains tax bill.

If you eliminated the principle residence exemption for capital gains, a lot of the angst would dissipate.

The average person pays capital gains tax on everything. I invest 5k into a stock and it doubles, I pay half of half on the gain. When someone else puts down 5k for a condo presale, and then moves in for a year and sells, they pay nothing on a leverage gain, yielding far higher returns.

People pay tax on the interest ‘growth’ in a GIC. Why should they not pay tax on the ‘growth’ of their home.

The political class is starting to clue in that there is no rationale for exempting real estate.

Give me one reason why the principle residence exemption should stay?

#3 Ray Skunk on 05.08.18 at 5:10 pm

Wealth taxes are the rage in academia among professors who have tenure, cannot be fired and have life-long defined-benefit pension plans (publicly-funded, so they need not save anything)

Nailed it.

Include the NPV of any public employee’s pension pot in a Wealth Tax calculation – and you’ll suddenly see a massive change of heart.

Assume a tenured prof was late to the game (after all, they had some learning to do), and can therefore retire at 60. 80% of final salary is the usual PS going rate, and from what I’ve seen many profs are at $180k/yr.

How much capital would you need to safely support annual payouts of $144k for the next thirty-odd years? Tax the shit out of that – go right ahead.

#4 Johny Baptist on 05.08.18 at 5:10 pm

Blessed are those who live quietly in their rentals and reap great gains from balanced portfolios for they shall be rewarded!

Cursed are those who sit in empty mansions, for they shall be cursed!

#5 Shawn Allen on 05.08.18 at 5:11 pm

Doubly blessed are the 8% as they borrowed so very heavily and pushed up and bid up the value of the houses of the wealthy and all those who bought before prices soared. Thanks be to you.

#6 Fake News Again on 05.08.18 at 5:15 pm

The problem is…..there is no one to vote for. They are either stupid or criminal…..or both. Welcome to Canada.

#7 Zapstrap on 05.08.18 at 5:16 pm

Always have been better off to be incognito. Nobody ever kidnaps bums. And I just don’t understand why you spell Millennial with a capitol M. Do they deserve it?

#8 SunShowers on 05.08.18 at 5:16 pm

Woo hoo! Bring on the wealth taxes! Can’t wait.

#9 GottaRunAway on 05.08.18 at 5:16 pm

Great article, but what could I possibly add?
I’ve done exactly like your last sentence… “learn a lot more about tax avoidance, get a fat liquid portfolio and go live quietly among the masses.”

Seen this coming years ago, so I sold last year (west coast), gathered my cash and moved on.

There’s no reasoning with this crowd. Unfortunately, it appears to be a world-wide phenomena. :(

#10 Guy Willoughby on 05.08.18 at 5:17 pm

Great article Garth:

People, especially the blue collar, have been economically devastated. There anger can easily be misdirected. Governments can legislate and tax a region or country out of business. Then they might start cannibalizing certain segments of the economy. This was seen in communist revolutions around the world.

As Dr. Paul Craig Roberts explains, the ladder up has been kicked out from beneath their feet through legislation and taxes. In my line of work, the one thing I hear from people is that they want a chance to prove themselves.

Mikhail Gorbachev said that North America needs it’s own Glasnost and Perestroika. He could be right.

#11 FOUR FINGERS WATSON on 05.08.18 at 5:23 pm

Baby boomers represent approximately 30% of voters. Millennials now represent approximately 32% of voters. What the boomers have earned and acquired over a lifetime, the millennials want the same right now.They feel entitled. Prepare yourselves accordingly.

#12 Musty Basement Dweller on 05.08.18 at 5:32 pm

When does the speculation tax actually kick in in BC? Isn’t it all still “speculation” until then?

#13 renter in Surrey on 05.08.18 at 5:33 pm

Government created this mess in the first place by CHMC insurance and low interest rate.

Social inter-generational contract was broken to some extent0

Retired boomer living in 4mil house can deffer property taxes
however millennial who works and pays income tax that pays pension to the boomer can’t deffer paying rent and can’t afford to buy RE.

If millennial can’t afford to buy RE he is told to move out of BC,
in this case we can argue that if boomer can’t pay property tax he/she should sell and move out as well.

“Tax based on possessions, not income nor the ability to pay, do not have a legacy in Canada. It’s Robin Hood stuff. ”

Well, there was not income tax in Canada prior to WW1 in 1917. Income tax is even worth Robin Hood stuff.

Why do we have principal residence exception?

Person # 1 buys a house for $100, lives in it for 30 years, then sell it for $200.
There is no tax on $100 gain.

Person # 2 buys securities for $100, receives dividends that pays for rent, sells securities 30 years later for $200. Gain is $100, 50% is taxable. Is it fair?

How about we have flat income tax rate of 10% just to pay for defense and the for the rest people pay out of their pockets on free market (education, health, etc).

But what would all those government gender equity enforces do?

Look at cost of goods/services that is bought and sold on free market comparing to cost of goods/services that is financed by government. Former is getting cheaper and later is getting more expensive.

And all those idiots brainwashed by radical left oriented educators are hoping that government will solve their problems where these problems would not be here in the first place without government “help”.

Bottom line – Canada and USA are marching towards socialism, so get used to confiscations in one way or another.

#14 TheSpangler on 05.08.18 at 5:38 pm

#2 Spillover nailed it.

Why should PR’s be fully tax exempt? Make it comparable to the TFSA limits.

#15 Lisa T on 05.08.18 at 5:39 pm

I thought the war with Alberta was because of the pipeline not second house tax? What did I miss.

#16 Mr. Trump on 05.08.18 at 5:43 pm

Poor Canada!
The leftists are killing the country, pretty soon it will be called Canazuela.
Thanks God for Trump, Pence, and Marco Rubio.

Why I left the left
https://www.youtube.com/watch?v=hiVQ8vrGA_8

Candace Owens on Her Journey From Left to Right
https://www.youtube.com/watch?v=BSAoitd1BTQ

#17 eightlock90 on 05.08.18 at 5:44 pm

Principal residence exemption, ultra low interest rates, nimbyism to urban density, 0 down 40 year ams. Not a peep out of anyone.

One tax targeting the absolute wealthiest and well off people in the country and nothing but kicking and screaming.

“policy that benefits me, but not for thee” – boomers.

#18 TS on 05.08.18 at 5:45 pm

Funny how history repeats itself…the rich get richer until the the 99% finally fight back. Been going on a lot longer than just Robbin Hood. Why should somebody with a 4 million dollar house pay nothing in tax while somebody toiling in the salt mines gives a third to half to the government? Doesn’t make sense for a society like Canada that prides itself on its inclusive and fair values.

#19 Newcomer on 05.08.18 at 5:50 pm

I can’t see what the fuss is about. Property tax (which is to say, a tax based on possessions, not income) is not new, nor is it new to make it progressive. That said, watching the entitled rich make asses of themselves reacting to it is kinda fun.

#20 Great Dirty North on 05.08.18 at 5:55 pm

What a dirty country we live in. Most Canadians delight in bashing the USA but for all its faults the USA is more transparent and fair than Canada. The world spends it time looking at the USA under a microscope so of course you will find fault everywhere, but it the world spent as much energy looking into Canada under a microscope you would realize this country is far more corrupt.

One hedge fund manager famously stated that he would never invest in the TSX unless it was a stock also listed on a USA exchange for the simple fact that no one is ever convicted of dirty dealings in Canada but if it is also listed on a US exchange there is a significantly better chance at justice.

From yesterday’s Toronto Star
https://www.thestar.com/news/investigations/2018/05/06/offshore-tax-havens-set-to-overtake-canada-in-corporate-transparency.html

Last years detailed article
http://projects.thestar.com/panama-papers/canada-is-the-worlds-newest-tax-haven/

#21 Damifino on 05.08.18 at 5:55 pm

…learn a lot more about tax avoidance, get a fat liquid portfolio and go live quietly among the masses.
————————–

Done, done and done. Eight years ago, when the writing was on the wall. Much happier now.

#22 Guy in Calgary on 05.08.18 at 6:05 pm

Your choices seem to be to vote for far left or far right. There is no representation for fiscally conservative lefties. One will tax you into oblivion and the other takes you back to the stone age.

I guess I’ll have to vote rhino party next time around.

#23 Newcomer on 05.08.18 at 6:07 pm

#2 Spillover on 05.08.18 at 5:08 pm

Give me one reason why the principle residence exemption should stay?
——

Without it, you could lose a lot of money when you sold your house in order to move. Assuming you moved to an equivalent market, you would have to buy a lesser house, because part of the value of your present house would disappear in tax when you sold it. But this could be solved by exempting those gains that are spent on a new principal residence within some fixed period of time.

As it stands, it’s mostly a gift to old rich people. There is no reason to exempt it from capital gains when it is used to fund a retirement.

Maybe we could exempt 5.5 K year in your choice of TFSA contributions or real estate purchases. Now we’re talking fair.

#24 Paul on 05.08.18 at 6:09 pm

#2 Spillover…nailed it.

#25 eaglebay on 05.08.18 at 6:09 pm

#2 Spillover on 05.08.18 at 5:08 pm

It’s “PRINCIPAL”.

#26 WUL on 05.08.18 at 6:10 pm

#177 Vancouver Brit on 05.08.18 at 4:59 pm
#105 sprigg on 05.07.18 at 10:59 pm
******

Just a shout out to you Vancouver Brit for taking the time to answer sprigg. A nice simple act of kindness and well written. I have not seen such a sound and succinct piece on re-balancing.

You made this comment section more classy (a low bar). You’ve earned the right to hoist one. As a Brit, it doesn’t even have to be a cold pint. Warm is fine.

Well done and cheers.

#27 garth, quick question on 05.08.18 at 6:18 pm

The guy with the $1,000,000
Portfolio vs the guy The clear $1,000,000 house ?

If they sell who gets to keep more ?

Guess I made a good call with the house …lol

#28 Pepito on 05.08.18 at 6:19 pm

Neither wealth taxes nor capital gains taxes are particularly novel in the EU. 700,000 euros seems to be the point when they kick in in Spain and , in Germany, capital gains taxes are paid on any residential property owned for less than 10 years. Same goes for most of the other measures now being taken by various provincial governments in Canada such as empty house tax, foreign ownership tax etc… All of which you seem to suggest are unheard of and unprecedented. Sounds to me like Canada is just catching up more than anything else.

#29 Wallflower on 05.08.18 at 6:26 pm

Try applying for your spawn’s bursary with $300K liquid assets and no house: nada. But the guy with $0 liquid assets and $3M non-mortgaged house: full bursary.

#30 TAX AND SPEND AGAIN on 05.08.18 at 6:29 pm

I can’t understand why people don’t understand that the reason we are in a bind is the government is the enemy. All they know is tax and spend with no accountability. Always looking for more from productive part of society. With no business, no revenue for government. The left always succeeds in biting the hand that feeds till there is nothing left for anyone. Venezuela.Always want something for nothing. Doesn’t work.

#31 eaglebay on 05.08.18 at 6:30 pm

#28 Pepito on 05.08.18 at 6:19 pm

Because Europe is overtaxed it doesn’t mean that we have to follow.

Instead of raising taxes and all the other so called fees, it might be a good idea for our “leaders” to cut waste and other mismanaged revenues. This would include interference in our markets be it RE or business.
Isn’t the job of a government to protect people and their properties and to provide essential services?
We don’t need social engineering. People should be able to take care of themselves.

Garth, how can you put up with some of the comments on your blog? Whatever happened to common sense?

#32 Trojan House on 05.08.18 at 6:34 pm

#13 renter in Surrey on 05.08.18 at 5:33 pm

Because houses were generally a place to live and not classified as an investment. Except that now, over the years, houses have become an investment. As Garth constantly states, speckers, one property slum lords, house horny mills and FOMO have driven the prices of real estate up to astronomical heights where it is no longer about a place to live but an investment to make money.

Anyway, this was caused in part by government policies (low interest rate policies, CMHC, etc). Of course, what does government do when they create a mess? Try to fix it by creating an even bigger mess. Free markets sort themselves out. Manipulated markets become nightmares.

#33 Prairieboy43 on 05.08.18 at 6:36 pm

Smoking Mans train is going to be loaded. Looks like Garth is Jumping on. Next Stop Alberta………..
PB43

#34 luckytimbo on 05.08.18 at 6:47 pm

Garth, don’t know if you’d answer this. Is there a good way for protecting licensing income for an Intellectual Property, whereby the licensor is an American Chemical Company and most of the income is generated in the USA. Do we have to move to New Hampshire?

#35 Gerry on 05.08.18 at 6:48 pm

Most profs have tenure and cannot be fired (kind of the same thing) and defined contribution pension plans, not defined benefit plans. Davidoff in particular, presumably the fellow to which you’re (indirectly) referring, has a defined contribution pension plan and an obligation to save (with lots of help from UBC). Just saying.

#36 Waiverless on 05.08.18 at 6:48 pm

#27 garth, quick question on 05.08.18 at 6:18 pm
The guy with the $1,000,000
Portfolio vs the guy The clear $1,000,000 house ?

If they sell who gets to keep more ?

Guess I made a good call with the house …lol
——-

Well the guy with the portfolio is generating 60k tax advantaged annual income if he doesnt sell so there is that.

#37 Parksville Prankster on 05.08.18 at 6:53 pm

‘@ #27 garth, quick question on 05.08.18 at 6:18 pm
The guy with the $1,000,000
Portfolio vs the guy The clear $1,000,000 house ?

If they sell who gets to keep more ?

Guess I made a good call with the house …lol’

…guess who gets to keep more cash flow, pay less upkeep, and is able to rebalance? Who has to pay an agent 6% of the gross capital cost to liquidate? A principal residence isn’t an ‘investment’ it’s technically a liability as there is no constant cash flow only constant costs. And you’re either all it or all out, you can’t sell a shingle if they go up in value.

#38 LivinLarge on 05.08.18 at 6:55 pm

“It’s what motivated Trudeau to slash the TFSA contribution limit from $10,000 back to $5,500 a year, despite it being the most democratic tax avoidance vehicle in the land.”…”Always with the negative waves Moriarty, always with the negative waves.

You always drag up this canard on slow news days. I guess if you spin something long enough and loud enough some fools just might start to believe it’s true.

Helmet head goosed the contribution limit from $5K to $10K in a cynical attempt to buy votes and keep the 4% of Canadians who were already maxing out their TFSA clearly in the Reform Party camp.

Yes, $10k is a wonderful limit without question but T2 simply cancelled Helmet Head’s vote buying plan once he was elected.

#39 Niagara Region on 05.08.18 at 6:57 pm

Re: #3 Ray Skunk on Professors
___________________________________________
Such fictive claims about tenured professors make me laugh–or cry. I’m a tenured professor. Neither I or my husband (also a tenured prof) earned a living wage until we were over 40. Yes, schooling to be a professor takes a very long time. To find a tenure-track job, I had to leave my husband in the U.S., because profs don’t get to choose where they live. My husband, at 57, still has student-loan debt. We own nothing: no houses, no real estate of any kind, no commodities, nothing. We have only our retirement pensions through work. It’s not $144k, Stan: mine is projected to be less than one-third of that figure, and I contribute regularly. My husband and I both rent dumpy properties in which to live. We couldn’t even afford to have a kid. I do not expect to retire until I’m in my 70s because I doubt I’ll be able to afford it. Surveys repeatedly indicate that professors work 45-60 hours per week. I see myself like an NBA star: I have only a short window for earning and therefore must earn a good salary to pay for all those negative earnings in the first two decades of adulthood. (Btw, I don’t know any profs who earn $185,000. That figure is a gross overestimate.) Plus, as a professor, I pay thousands of dollars of expenses each year that are not tax-deductible because I’m a salaried employee.

Despite all these problems, my husband and I are considered the lucky few in academe because we are tenured in an occupation where large numbers of PhD holders are temporary, part-time university instructors who don’t get any benefits and who earn less than minimum wage for teaching courses. If you want to see what laboring in academe is actually like, see Marc Bousquet’s book “How the University Works”: https://academictrap.files.wordpress.com/2015/03/marc-bousquet-how-the-university-works-higher-education-and-the-lowwage-nation.pdf

I suspect that the seemingly ubiquitous negative PR campaign against professors is, in part, because we help students develop the abilities to think critically about such things as politicians’ speeches and the evening news; and we help students become informed citizens by teaching such topics as American foreign policy and histories of colonialism. Hence, a lot of politicians, especially in the U.S., have been de-funding higher education for the past three decades, and many bad-mouth “lazy professors.”

If Canadians want to save tax money, I’d recommend looking at how much tax money has been spent on such causes as the war in Afghanistan. Also, didn’t the Paradise Papers reveal some extremely wealthy Canadians hiding their money off-shore and evading
taxes?

It’s not in the interests of working- and middle-class people (presumably most people on this website fall into one of these two categories) to turn against other groups of people who work/worked for a living. Avoid falling for the conquer-and-divide ploy, whether along occupational lines or age (e.g., wrinklies vs. millennials). If you want to find people to criticize, look up–I mean really far up–the economic scale. Look at such families as the Waltons, the billionaires who own Walmart but who pay workers crap; and, as a result, as a California Senator’s report demonstrated, leech $600,000 per year per store from taxpayers, largely because taxpayers end up subsidizing poorly paid workers’ housing, food stamps, etc. Look also at the Sacklers, the manufacturers/owners of Oxycontin, who have earned billions from the opioid crisis but who are leaving taxpayers with the bills for addicts’ recoveries.

A footnote: The only professors I’ve ever known to retire at age 60 did so because of family money, definitely not because of money earned in academe. Why do you think so many profs work well past age 65?

I must go finish two conference papers that I’m presenting this week in the U.S.–and I’m footing the entire bill for all my conference expenses with my post-tax dollars, expenses that are not tax-deductible.

#40 X on 05.08.18 at 7:00 pm

So the mentality in BC is to vote for people who are going to tax things that you want to buy, but cannot afford. I don’t understand how that makes sense, when you eventually can buy and afford said purchase, as you have only accomplished higher taxes for yourself. Bravo.

#41 paracho on 05.08.18 at 7:06 pm

Once again you said what needed to be said ! Well said ! Bravo !

#42 Blood in the Streets on 05.08.18 at 7:07 pm

26 WUL on 05.08.18 at 6:10 pm

#177 Vancouver Brit on 05.08.18 at 4:59 pm
#105 sprigg on 05.07.18 at 10:59 pm
*********************************************
“Re-balancing simply means you would sell some of the overperforming holdings and buy some of the underperforming, to return you back to your original weightings. In this case you would sell some equity to buy some bonds to return you to 50/50.

This does a couple of things. Firstly, it means you always sell high and buy low, which is an obvious strategy to higher returns. Secondly, it maintains your level of risk at the original level you intended. If you don’t re-balance, your high risk return holdings will become overweighted in your portfolio, which is a bad thing if the market crashes and you will lose more than you are comfortable with. Re-balancing periodically brings you back to your initial risk tolerance. ”
——————————————————–
All true Brit but…

I no longer subscribe to the traditional way of talking about ‘risk’. It’s almost meaningless unless you examine it along side the flip side: ‘reward’.
For me, every single holding (whether it’s an ETF or single stocks), has an “upside reward” vs. “downside risk”.
Yet, all sorts of financial entities (and laymen) talk about it about ‘risk’ as if it exists on its own.
But it never does! Risk/Reward ALWAYS exist as the two sides of a coin. You can’t really talk about one without considering the other – yet people always do.
And you can apply this relative metric to any asset really, including GIC’s: upside=2% (interest) vs downside=-3% (inflation), along with the unfavourable way interest is taxed (as opposed to dividends or cap. gains). Ditto for RE…

Bloody One

#43 Capt. Serious on 05.08.18 at 7:14 pm

BC might as well just go full communist. Have the province seize all assets. House workers in concrete apartment blocks, house all the government wonks in the nice condos and homes. It is after all what the people want. The government is there to see all the needs of the people fulfilled. All animals are equal but some animals are more equal than others.

#44 Capt. Serious on 05.08.18 at 7:17 pm

#41 paracho on 05.08.18 at 7:06 pm
I don’t understand how that makes sense, when you eventually can buy and afford said purchase, as you have only accomplished higher taxes for yourself. Bravo.

Winner, winner, chicken dinner! Or exact, as the French would say. Taxing other people is not going to help you in your life get to where you want to be. Full stop.

#45 Chaddywack on 05.08.18 at 7:17 pm

A more pressing reason for the wealth tax is it’s really the only way to capture taxes from foreign buyers who own houses here or buy ferraris but pay little to no income tax.

#46 Spillover on 05.08.18 at 7:20 pm

#23 Newcomer on 05.08.18 at 6:07 pm
#2 Spillover on 05.08.18 at 5:08 pm

Give me one reason why the principle residence exemption should stay?
——

Without it, you could lose a lot of money when you sold your house in order to move. Assuming you moved to an equivalent market, you would have to buy a lesser house, because part of the value of your present house would disappear in tax when you sold it. But this could be solved by exempting those gains that are spent on a new principal residence within some fixed period of time

——–

Then rent…..

That is what everyone young person is told who cannot afford the costs of home ownership….

#47 Another Deckchair on 05.08.18 at 7:23 pm

I see a lot of greed with the millennials.

– I’m a young boomer.

– My partner and I live in a good area of town. In a 1950s’ house, which has not been supersized. One car family, even when raising kids. Buses and bikes (and, walking) are inexpensive ways to get around for kids, and parents.

So, how come houses around here get knocked down, big box homes get put up, prices this spring are close to 2 million, and young families move in?

What gives? Our little house was fine for raising kids, why does almost everybody have to add a room at the back, another floor, or, just a bulldoze-n-build job?

Schools (a primary one was just rebuilt) are about 4 city blocks away, no lights to cross, only residential streets. Why do you need two cars, and why do you have to drive your kids to school? Ours walked to school, along with all the other kids on the street.

Why the blatant greed?

(Sure, there are some younger couples who’ve moved in who obviously “get it”, and appear to live well within their means, but they are in the minority, the greedy ones far outnumber them. And, some kids actually walk to school, too, so one can’t paint everyone with the same brush, thank goodness!)

#48 Angie on 05.08.18 at 7:25 pm

#27 Garth quick question. Maybe you did make a good choice. What is the problem about windfall capital gains is it is like winning the lottery. It required no special skill or knowledge or discipline to get it. The person patient enough to carefully amass $1 million liquid will be doing better in 10 years than the guy whose house doubled in a few years and cashes out. Portfolio guy can take the same steps again and double his million. Try and replicate your results and double your money again, house guy. That’s what I thought.

#49 Dave on 05.08.18 at 7:26 pm

The housing situation in Vancouver is a national disgrace, due to lack of government leadership and policy. Christy Clark allowed money laundering on her watch and actually took realtors to trade delegations to China. What are we trying to do maximize investments and sell our real estate to the highest bidder or provide homes to working taxpayers? The NDP may not have the best policies but at least we have a government who acknowleges we have a problem and is taking steps trying to fix it.

#50 No sympathy on 05.08.18 at 7:33 pm

The most important thing for the future is education. Otherwise we end up with more stupidity in the future. Public education is already socialized. He fact that Hess wealthy whiners can’t stomach what would about to roughly $1000/yr or something in that range is ridiculous. And if you think that sounds like a lot-it’s not to anyone who has over $1 million in assets. I would happily spend that for education (as yes I do give charity). Granted my assets are not in a house but in other investments but still…you can spin it how you like but the truth these are greedy people. If you don’t spend on your community it won’t be so nice anymore.

#51 Long Branch Apprentice on 05.08.18 at 7:34 pm

#39 Niagara Region

Where do you teach, what do you teach and at what age did you begin to fully realize the folly of your ways? You are clearly bitter and resentful about trying to life a “life of mind” as an academic. Who held a gun to your head and forced you to pursue poorly paid post-doc after poorly paid post-doc?

Let me guess, you were too scared to work with your hands, and you think you are intellectually superior to those who do. If your husband still has student loans at age 57 (an age when most in my profession are retired!”), then perhaps he should have studied math.

Another crybaby with tenure who regrets their choice, sounds like you are an exemplary academic.

Go publish your paper in some obscure journal where maybe 6 people will read it, and fewer than that will cite it.

#52 Happy Housing Crash Everyone! on 05.08.18 at 7:34 pm

You lazy communist conservatives. Why do we still have CMHC? Conservatives are socialists for the rich (banks). CMHC should be shut down so that the free market can correct this housing ponzi scheme that taxpayers are backing

#53 crowdedelevatorfartz on 05.08.18 at 7:36 pm

@#47 Another Deckchair

I dont think laziness and greed is a Millenial trait.
God only knows the obesity rates in this country seem to know no age limit.
As for envy, greed and sloth.
Cant blame those on Millenials and Boomers either.
Part of the original seven deadly sins……

#54 Graeme on 05.08.18 at 7:39 pm

At what point does buying gold burying it become attractive?

#55 Bobby on 05.08.18 at 7:53 pm

There is a reason the NDP government here in B.C. was turfed out unceremoniously 16 years ago and left with only two seats. We are witnessing it again first hand, I’m just surprised it is happening so quickly. They couldn’t run a hot dog stand.
Left leaning governments rely on the financial illiteracy and political naivety of Canadians to get themselves elected. Under their watch everything is going to be free and everyone’s lives will improve immensely because someone else is going to pay. Sadly it all comes crashing down rather quickly when voters realize that they are the ones actually paying and their job is tenuous because the economy is also tanking. How many taxes has the NDP introduced since coming to power, most have lost count. I thought their intent was to make life more affordable.
Even at the federal level, many middle class Canadians are paying more taxes than before the so called middle tax tax cut. So much for helping the middle class.
May I suggest an alternative, a tax on idiots. Here in BC within the ranks of Green and NDP supporters you would find enough monies to offer free daycare and pay off the entire National debt.
The sad reality is both the Greens and the NDP are propping each other up, afraid to go back to the polls. Both realize their days are numbered.

#56 Vancouver Brit on 05.08.18 at 7:54 pm

#26 WUL on 05.08.18 at 6:10 pm
#177 Vancouver Brit on 05.08.18 at 4:59 pm
#105 sprigg on 05.07.18 at 10:59 pm
******

Just a shout out to you Vancouver Brit for taking the time to answer sprigg. A nice simple act of kindness and well written. I have not seen such a sound and succinct piece on re-balancing.

You made this comment section more classy (a low bar). You’ve earned the right to hoist one. As a Brit, it doesn’t even have to be a cold pint. Warm is fine.

Well done and cheers.
___________________________________________

Thanks! I was in his shoes a few years ago and the world of investing can be a bit daunting to any newcomer, so I’m always happy to help anybody trying to learn the ropes. Hopefully he sees the response, maybe I should have included it in today’s post instead. Obviously it was succinct though, I’d research more about index investing if I were Sprigg before jumping in. Don’t be fooled into one of those managed funds though, they’re usually expensive and it’s so simple to do yourself for a fraction of the cost.

#57 Bobby on 05.08.18 at 7:56 pm

For #49 Dave,

The Vancouver problem is largely due to problems at the federal level with many federal agencies, CMHC, Fintrac, OSFI, CBSA and CRA. Most knew the problems but were afraid to do anything about it.

#58 Original Observer on 05.08.18 at 7:57 pm

Renter in Surrey #13

“Person # 1 buys a house for $100, lives in it for 30 years, then sell it for $200.
There is no tax on $100 gain.”

“Person # 2 buys securities for $100, receives dividends that pays for rent, sells securities 30 years later for $200. Gain is $100, 50% is taxable. Is it fair?”

Renter, the answer to your question, “Is it fair?” is yes, it’s absolutely fair. The beauty of living in this wonderful country, and the reason so many leave their homes to come to this wonderful country is that there are no laws that prevent Person 2 from having the same choices and opportunities as Person 1. In other words, both had the same choices available to each. There was nothing preventing Person 2 from buying a home instead of investing. Both started with the same amount, both had the same choice.

Garth is constantly preaching tax avoidance on this forum to educate readers on how best to keep what they’ve earned. This ‘choice’ is no different.

#59 Nonplused on 05.08.18 at 7:59 pm

The only “wealth” taxes that are appropriate are property taxes and then only because it does cost the municipality something to build and maintain the roads, clear the snow, and run the schools. But it’s still a bit socialist in that the amount you pay is based on the market value of your property. Why should this be? Do people with million dollar houses cost the education system more? Do they drive more miles? Why exactly does somebody with a $2,000,000 house need to pay 4 times as much as somebody with a $500,000 in property taxes? It’s simply more wealth redistribution.

But at least with property taxes you can avoid paying 4 times more just because you have the money by living small. Buy the $500,000 house and invest the remaining $1,500,000. It’s unfortunate that it is where we are at but it is how you have to live to avoid all the communism inherent in the system.

“Capital gains” taxes are and always were just a wealth tax as well, especially in an environment where 2% inflation is the “target”. In a 0% inflation world maybe their might be some cause to argue for capital gains taxes but in an inflationary environment it is hard to tell whether the asset really appreciated or it just inflated.

I bought a gold coin years ago for $800. If I sell it today it would fetch $1315. Plus the Canadian dollar has crashed 20% so in Canadian dollars my gain is even larger. But I still only have one coin. Why do I owe the government part of my coin now? Why do I owe them money on the fact that the Canadian dollar has declined against the US dollar? Do I owe them money on the US dollars I have in a US account that stayed US dollars while the Canadian dollar fell? So now they get part of my US dollars just for letting the Canadian dollar fall? It’s ridiculous.

All taxes are in essence wealth taxes, except consumption taxes like the HST, carbon taxes, and sin taxes. Any attempt to raise taxes is basically the government saying “Well, we’re broke. If you have any money send it to us.” It’s not about “fairness” or “social justice” or any other crap. The government is broke so if you did well and saved some money they want and need it.

The whole point of the tax system in this country is to “Take from each according to their means, and F*$K YOU if you need anything because you aren’t getting it from us!” That’s the new communist manifesto as espoused by the NDP and the Liberals. The Conservative platform is a little different in that they’ll try and take a little less but otherwise it’s the same.

When life is fair there are reasonable rules that apply equally to everybody. For example imagine a sports game where one team was exempt from the rules. So lets say one team scores a goal, and that results in an automatic penalty kick, penalty shot, or free throw for the other team. What would be the sense in that? But that is what socialism is about.

Here is the properly worded red-pill translation of socialism: “If you lose you lose, and nobody is going to help you. If you win you also lose, and we are coming to take your trophy.”

#60 Markets Work on 05.08.18 at 8:03 pm

#2 Give me one reason why the principle residence exemption should stay?

#23 Lays out economic reasoning behind the policy, and it’s a good reason. And with it comes various other issues around mobility and why freedom of mobility is so important and supported in free societies. Business, Gov and society in general require it.

Another reason is that it is your primary residence. A need vs a want. There are many tax exemptions for human ‘needs.’ You get a refund on medical expenses and saving for retirement. A head of lettuce is taxed differently than a chocolate bar. The TFSA is in place because it is understood that in a modern society you need some kind of investment vehicle outside of RE that can’t be taxed. Even a small % tax on a compound growth asset is crippling in the long term.

Besides, if gov starts to tax capital gains on RE they better allow write offs for loses.

Also, Gov has been pushing houses as a retirement savings option for decades. To pull the rug quickly now is cruel.

I might consider supporting some form of cap gains tax on housing over a certain value but, four million in Vancouver ain’t it. Maybe gains taxes on the sell value over $10M revised yearly for inflation. Those are the levels where you are taxing the right group justly and fairly. The 0.01%.

If you want to fix the housing affordability issues in BC reduce building and zoning regs, stop Gov encouraging RE purchases and reform the BC Residential Tenancy Act.

My suggestion on the latter would be to split it; the pros and the amateurs. Loose and easy for the amateurs with lots of mediation and arbitration. On the pro side it would be tribunals (ie: adjudicators/officers), contract law and minimum standards. Split it according to the size of the building.

Do that and we will have more housing in more variety than anyone ever needed. Competition, prices will come closer to cost.

Garth, thanks for fighting the good fight.

#61 Too bad on 05.08.18 at 8:07 pm

I guess we can thank the Harper government for creating this mess with his 5% 40year mortgages

They were a mistake, but only briefly in place. Blame lies everywhere. – Garth

#62 Kurt on 05.08.18 at 8:08 pm

#2 – Spillover: nailed it.

#63 NEVER GIVE UP on 05.08.18 at 8:15 pm

#119 Smoking Man on 05.08.18 at 12:53 am
My hardcore drinking days are over.
Nearly died on the weekend.

I want to die on my own terms, be totally sober to enjoy the view when I try a jump grand canyon in the rented ragtop.

Just before I get admitted to palliative care or forced into a nursing home.

I certainly don’t want to die falling flat on my face while being completely shit faced with no memory of the personal terror and excitement that will bring.

Close call this weekend.
====================================

Hey SM! Any wuss can quit drinking and smoking.

But it takes a real man to face Cancer or Liver disease!

Party on Man!!!

#64 #3 of the Majestic 12 on 05.08.18 at 8:27 pm

#18 TS on 05.08.18 at 5:45 pm
“ Why should somebody with a 4 million dollar house pay nothing in tax while somebody toiling in the salt mines gives a third to half to the government? “
_________

How about because they paid for it in after-tax dollars from their own sorry toil?

#65 Camille on 05.08.18 at 8:28 pm

What a wonderful piece! And great comments. Thank you.

#66 Long-Time Lurker on 05.08.18 at 8:28 pm

#6 Fake News Again on 05.08.18 at 5:15 pm
The problem is…..there is no one to vote for. They are either stupid or criminal…..or both.

Welcome to Canada.

>Global problem.

#67 Sask to AB on 05.08.18 at 8:29 pm

#47 Another Deckchair on 05.08.18 at 7:23 pm
Excellent Post.

#68 Eddy Haskel on 05.08.18 at 8:31 pm

#178 Eddy Haskel on 05.08.18 at 5:03 pm
#174 IHCTD9You’ve got jack until it’s sold.

“If you haven’t listed already, yesterday was a better time than today for you to do so – if you want to save what’s left of those tasty CG’s.”

Let me put this in perspective for you. I have been mortgage free for 30 years…. For my property to lose it’s tasty capital gains, we would have to have Great Depression like deflation. I know people who bought homes in the 50s for 20k whose homes are now worth 100 times that at 2 million.

#69 NEVER GIVE UP on 05.08.18 at 8:34 pm

#2 Spillover on 05.08.18 at 5:08 pm
You can have $4 million in a liquid portfolio turning out $300,000 in low-taxed income and nobody cares. But move into a $4 million house producing no income, and you’re a social pariah who deserves a tax spanking. Paleo thinking. But it’s spreading among the political class.

————–

Its because real estate continues to be the only asset class that doesn’t have to pay capital gains taxes if you sell your principle residence.

When the owner of the $4 million dollar house sells, they get a tax free windfall. When the owner of the $4 million portfolio sells, they get a huge capital gains tax bill.

If you eliminated the principle residence exemption for capital gains, a lot of the angst would dissipate.

The average person pays capital gains tax on everything. I invest 5k into a stock and it doubles, I pay half of half on the gain. When someone else puts down 5k for a condo presale, and then moves in for a year and sells, they pay nothing on a leverage gain, yielding far higher returns.

People pay tax on the interest ‘growth’ in a GIC. Why should they not pay tax on the ‘growth’ of their home.

The political class is starting to clue in that there is no rationale for exempting real estate.

Give me one reason why the principle residence exemption should stay?
===================================
It should stay but should be with a simple fix.
Live in the home for 7 years and you can sell with no Capital gains tax.
Remember you have to live in it and it must be your principle residence.
How hard would that be to implement.
It would put a cold shower on flipping.

In addition the assignment flipping is just the old Liberal Government in BC allowing it so they can get contributions and slush from their developer friends.

Assignment flipping has resulted in drowning in debt Mills, and the theft of wealth and future from an entire generation in BC.

Good Work Libs!

#70 Ian on 05.08.18 at 8:37 pm

Started reading a new book that came out today, The Great Revolt. It interviews common people in the rust belt states who would normally be Democrat but voted Trump. They did over 300 interviews. Highly recommend it.

Government in Canada will get worse and worse until all the capital leaves. This place really IS Venezuela.

#71 Lorne on 05.08.18 at 8:46 pm

#55 Bobby
The sad reality is both the Greens and the NDP are propping each other up, afraid to go back to the polls. Both realize their days are numbered.
……
Thanks for you OPINION, Bobby , but the actual reality is that the NDP’s Leader and the NDP are clearly being supported by the majority of the people in the province (I know it must hurt you to read that!)
https://bc.ctvnews.ca/6-months-in-53-approve-of-horgan-s-performance-as-premier-poll-1.3767906

https://www.huffingtonpost.ca/2018/03/21/canadas-most-popular-premiers-poll-2-leaders-tied-for-top-spot-after-brad-walls-exit_a_23391543/

#72 dr talc on 05.08.18 at 8:49 pm

Give me one reason why the principle residence exemption should stay?
…….

The amortization schedule
The borower pays double the face value of the loan amount over 25 yrs
There’s no windfall
There’s no profit
A 4 million mortgage requires 8 million in payments
Read it again

#73 For those about to flop... on 05.08.18 at 8:53 pm

Recent Sale Report/ Realtor Assistance Needed.

Not too sure why zolo took so long to clear this one as sold but I will put it up and try and get an answer.

Sold 46 days ago.

They were on the hook for 1.07 and took the best part of a year to find the next one.

Did they make enough of a windfall to book a trip to Dublin…

M43BC

2219 Dublin Street, New Westminster paid 1.07 March 2016 ass1.07 1.15

May 4:$1,225,000
Aug 9: $1,188,000
Change: – 37000.00 -3%

https://www.zolo.ca/new-westminster-real-estate/2219-dublin-street

https://www.bcassessment.ca/Property/Info/QTAwMDAzVVdDRQ==

$$$$$$$$$$$$$$$$$$$$$$$$$$$$

Feel free to make a donation.

Flop For Fox Fund…

http://www.terryfox.org/get-involved/ways-to-give/

#74 Rifles on 05.08.18 at 8:56 pm

The divisive identity politics indulged by our silver spoon trustafarian PM and his similarly entitled finance minister have done nothing to strengthen Canada’s cohesiveness. Their sanctimony might be tolerable if they were any good at what they were elected to do. But they are not and Canadians must bear the brunt of their ineptitude. Sadly there are no obvious alternatives in the wings.

As for taxing the YVR westsiders out of capital they may not have, why not simply impose a more moderate – say 5-10% – capital gain on the sale of primary residences? Surely the tax free nature of the investment is one important driver of house price rises. Politicians who lack spine (cough, cough Trudeau) are unlikely to impose such a toll, but it strikes me as a more reasonable and market-based measure than harvesting unrealised gains from those that may not be able to afford them.

#75 Reynolds531 on 05.08.18 at 9:00 pm

True Story!

I was working with a guy today whose brother owns a bakery in Venezuela.

Apparently the latest thing is for the government to “inspect” your house. When they find extra rooms they assign you roommates. Forcibly.

They also are trying to implement a program where they hire a staff member in independent businesses to make sure you’re paying your share to the government. So the bakery would have a government employee whose only job is to make sure they pay taxes.

Hopefully never comes to Canada. But now you know why 2 million people have fled.

#76 Smoking Man on 05.08.18 at 9:01 pm

39 Niagara Region on 05.08.18 at 6:57 pm

The reason you’re struggling is that you have spent your entire life in school. A safe space. Anything safe doesn’t produce high yields. Unless you have friends in govt that give you untendered contracts.

Most of us who make good loot are risk takers. It’s that simple.

I’ll give you an example of prof like yourself who took a massive risk when he refused to use govt sanctioned pronouns. You know who he is. That could have been you.

Look at him now. Banking your loot now.

A successful risk taker will never let themselves get in a position that will allow the govt to step in and confiscated the proceeds of taking big bets.

You keep training little commies, the big money will leave dodge, your pension will vanish and your life will become a nightmare.

Just look at Venezuela is all I’m saying.

Dr Smoking Man
Phd Herdonomics.

#77 Newcomer on 05.08.18 at 9:02 pm

#46 Spillover on 05.08.18 at 7:20 pm
#23 Newcomer on 05.08.18 at 6:07 pm
#2 Spillover on 05.08.18 at 5:08 pm

Give me one reason why the principle residence exemption should stay?
——

Without it, you could lose a lot of money when you sold your house in order to move. …
——–

Then rent…..

—-

That’s not the issue. It was not designed as a fairness thing. The problem is that people would, in general, be reluctant to move, making both the housing and labor markets less fluid, which would be a drag on the economy.

When thinking about fiscal policy, it’s useful to keep in mind that it is very often a tool (carrot or stick) used to promote certain types of economic behavior. Raising money and/or redistributing wealth are, often enough, secondary considerations. For example, most of the new taxes in BC are only intended to encourage people to sell (or at least not buy) real estate. It’s like when parents make kids pay rent, it’s not that they want the money, they just want the kids to move out.

#78 Reality is stark on 05.08.18 at 9:06 pm

You can tell from the comments on this blog that the new generation believes wholeheartedly that a successful government taxes and borrows it’s way to prosperity.
Years ago MBA’s wanted to work in the private sector now their first choice is to work for the Canadian government. Why? Because the private sector has become too rough and mean.
They are right, the private sector has become vicious, this is an opportunity for the public sector to radically reduce wages to reduce debts and deficits.
Venezuela here we come.

#79 Niagara Region on 05.08.18 at 9:13 pm

Re: #51 Long Branch Apprentice’s comments
_________________________________________
Do you not see the defense of/support for working-class people and manual laborers in my earlier comment? Read my comment more carefully. My father is manual laborer. Approximately half the doctorates in Canada are currently earned by people from working-class backgrounds. People who think professors are hyper-privileged are only seeing the most visible laborers in the profession, not the other half (or even two-thirds) of instructors in academe. Wealthy professors usually became wealthy through familial money, not through the profession.

And, no, I don’t regret my career choice. It’s just annoying when people who very little to nothing about professors make ridiculous assumptions about who we are, what we make, and what we think.

Since you asked, much of my scholarship is about the myriad ways in which working-class people, including manual laborers, get burnt in society; and so, no, I don’t think I’m better than the working classes. Because of my background, I count myself among them.

#80 Terry on 05.08.18 at 9:13 pm

“Wealth taxes are the rage in academia among professors who have tenure, cannot be fired and have life-long defined-benefit pension plans (publicly-funded, so they need not save anything).”

The Liberals in the U.S. have, academia, the media and Hollywood. They wanted the U.S. Presidency, Congress and the Courts. Trump stopped them and thank God for that! It’s for this reason why the Democrats are still so bitter about their loss. We stopped them in their crusade for a Fascist agenda. I’ll say it again and hope it sinks in …………… Liberalism is best described as a disease. It is an illness and a sickness of the soul that needs to be cured.

Did your dog type that? If so, he’s having a bad day. – Garth

#81 Smoking Man on 05.08.18 at 9:20 pm

52 Happy Housing Crash Everyone! on 05.08.18 at 7:34 pm
You lazy communist conservatives. Why do we still have CMHC? Conservatives are socialists for the rich (banks). CMHC should be shut down so that the free market can correct this housing ponzi scheme that taxpayers are backing
…..

No one is more tight with big globalist corporations than T2. No one is more anti small biz and anti entrepreneur than T2

Get your head out of your arse.

#82 Arctic Gringo: Qalunaaq on 05.08.18 at 9:21 pm

I live where I live, in part, because of former MP for Peterborough, Peter Adams. Garth knows him. His glaciology and climate research was, and is, very intriguing. Long retired from both politics and academia, he’s probably doing better than okay.

Here’s a salaried disclosure list from 2015 for Trent University, a far-left leaning, small-ish, kinda place of higher educations:

http://www.trentu.ca/newsevents/2015salarydisclosure.htm

Not a soul under 100K. Can’t imagine UofT or Western professor salaries. Don’t want to even try to look.

Being an O.B.M. is not bad coin either.

#83 What can I say about that? on 05.08.18 at 9:21 pm

“Wealth taxes are the rage in academia among professors who have tenure, cannot be fired and have life-long defined-benefit pension plane (publicly-funded, so they need not save anything).” – Garth

—————————————————–

Yeah. They were also the main motivation behind the Me Too movement and open door immigration policy. Nothing wrong with that. Is there? The fact is, they are trying to move society to a more egalitarian state and that is probably positive overall.

#84 Van City Man on 05.08.18 at 9:23 pm

Many of these tenured professors going into retirement live in $3 million houses themselves.

#85 For those about to flop... on 05.08.18 at 9:24 pm

Recent Sale Report/ Realtor Assistance Needed.

This house in Richmond sold 6 days ago

They moved the price around but the last time I saw they were asking 1.89.

They paid 2.15 and sold it roughly a year later.

Assessment comes in at 2.05

Fair chance they lost money but time will tell…

M43BC

7720 Malahat Ave,Richmond. Now 1.89

Paid 2.15 April 2017

Were Asking 2.09

Now 1.99

7720 Malahat Avenue, Richmond

Jan 23:$1,998,000
Apr 9: $1,898,000
Change: – 100000.00 -5%

https://www.zolo.ca/richmond-real-estate/7720-malahat-avenue

https://www.bcassessment.ca/Property/Info/QTAwMDA1V1pZSA==

$$$$$$$$$$$$$$$$$$$$$$$$$$$$

Feel free to make a donation.

Flop For Fox Fund…

http://www.terryfox.org/get-involved/ways-to-give/

#86 Terrie Rolph on 05.08.18 at 9:27 pm

“(publicly-funded, so they need not save anything)”
This statement is misleading. The professors (and others with pension plans through their employers) have a significant percentage of their salaries deducted at source.

And they save nothing. It’s notorious behaviour among academics and teachers. – Garth

#87 Alan Dee on 05.08.18 at 9:29 pm

Foreigners pay a fee to establish residency in Canada – its an investor visa. So what if they also have to pay a tax on property too? The Canada investor visa is cheap by world standards. If the BC Foreign Buyer’s tax is “not going to make a difference” as Garth says, well who cares then Garth? Just tax it already.

Excess investment in real-estate due to low interest rates is a mis-allocation of capital that does not create wealth for the country. If its also resulting in empty units then its a obviously double mis-allocation. And if its not affecting that many people, well who cares then Garth? Just tax it.

Why should’t there be a phased in capital gain on sale of a primary residence?

Why shouldn’t there be a higher tax on investment income? Without it, its a smaller and smaller group of people who gain more of the wealth. And thus why shouldn’t there be a tax on wealth as well.

The problem with the NDP solutions so far is that they have not gone far enough, yet. Who cares if a few foreigners and people who can afford two or three homes have to pay a tax for that privilege. Is that hurting anyone? Is that stifling some other investment?

#88 Azyan on 05.08.18 at 9:30 pm

Hey Garth, not to disagree with you again, but…

https://www.reddit.com/r/canada/comments/8hxbva/vancouver_real_estate_why_multimillion_dollar/dyn6xjv/

2017 Residential Property Taxes per $1000 of Assessment

Winnipeg – $12.15

Halifax – $11.98

Ottawa – $10.68

Montreal – $9.88

Regina – $9.25

Edmonton – $8.51

Saskatoon – $8.48

Toronto – $6.62

Calgary – $6.50

Vancouver – $2.55

Yeah.

#89 Erin on 05.08.18 at 9:32 pm

Isn’t it interesting how tax rates for the wealthy are always referenced in a manner that many believe the poor souls (like a certain R/E Blogger) are paying the usurious rate on all of their income… instead of only on the amount OVER the threshold set in the tax law.

So Garth pays 53% on income over $230K… and that’s AFTER deductions. But we’re sure there is no intent to deceive… just standard operating procedure for the ruling class.

Do I rule you now? Cool. – Garth

#90 akashic records on 05.08.18 at 9:33 pm

At the heart of all these changes in taxation, leftist political wave is the profound change of Capitalism that created too big to fail/regulate financial and tech sector, where the handful of industry leaders grow into symbiotic existence with the state, ever since the archetype of this relationship, “The Fed” was set up.

Such symbiosis was never seen before, since national socialism and it’s twin, Communism.

“Western economies” gradually destroyed the middle-class, Western societies are morphing into totalitarian regimes.

Canada currently doesn’t offer significantly different economic prosperity for the general population than the underdeveloped countries I grew up.

In the past decades the trend is continuous decline, and what comes with it: increasing fight for the shrinking piece of cake available for the majority of the population, which creates pervert taxes, like foreign buyers, non-occupied real estate, etc.

The economic decline comes hand in hand with politics that aims to create divisions on identity, an old tried and working trick of totalitarian states.

A couple of decades ago in Canada everyone was trying to prove how non-racist the country was, today all efforts go into proving how racist it is. Institutions, like Human Rights Tribunal were created, straight out of Kafka’s books, operating like Communist party outlets functions at companies to police ideological and social crimes.

#91 Debtslavecreator on 05.08.18 at 9:49 pm

There is massive generational theft and inequality and the mills have every reason to be angry BUT the problem is their anger is raw and corrupt politicians use this to divide and conquer. Notice how all these policies have done nothing but confiscated wealth and done NOTHING to lower income taxes for ALL workers on the first 50 k of income
Most of these new tax dollars are going to pay for massive increases in government staff with great pensions and soon to pay for the rapid growth in interest expenses as out of control governments look to steal everything they can
The level of white collar corruption is off the charts
It’s only going to get worse
But the Mills and rest can’t seem to understand the stupidity of the policies these dumb and corrupt politicians are implementing

#92 Bobby on 05.08.18 at 9:52 pm

For #71 Lorne,

Have a look at the dates of the articles you published. Did you actually read the articles?
Both were dated long before the implementation of the myriad of these taxes. The carbon tax was raised on April 1st. Ask Vancouver drivers now what they think of the price of gas.
Like I said earlier, and you are a perfect example. The NDP and Greens rely on your political naivety and financial illiteracy to get elected.
Recent polls tell a much different story.

#93 For those about to flop... on 05.08.18 at 9:57 pm

Recent Sale Report/ Realtor Assistance Needed.

Here is another one zolo dilly dallied on as it sold 44 days ago but just came up as sold.

It was only a Possible Pinkie but it had some intrigue to it.

They paid 3.8 back in June 2015 and the assessment only rose over 4 million in 2017

I have had cases lose money in 2014 and 2015 but they are seldom and from memory mainly pre-sale condos out in Richmond.

I just don’t see this one going for full ask ,but I am a b-grade construction worker.

This one might be a Pink Draw but no more…

M43BC

1870 Sasamat St. Van paid 3.8 June 2015 asking 4.25 ass 4.02

https://www.zolo.ca/vancouver-real-estate/1870-sasamat-street

https://www.bcassessment.ca/Property/Info/QTAwMDAwMDAyQw==

$$$$$$$$$$$$$$$$$$$$$$$$$$$$

Feel free to make a donation.

Flop For Fox Fund…

http://www.terryfox.org/get-involved/ways-to-give/

#94 Paul on 05.08.18 at 9:58 pm

75 Reynolds531 on 05.08.18 at 9:00 pm
True Story!

I was working with a guy today whose brother owns a bakery in Venezuela.

Apparently the latest thing is for the government to “inspect” your house. When they find extra rooms they assign you roommates. Forcibly.

They also are trying to implement a program where they hire a staff member in independent businesses to make sure you’re paying your share to the government. So the bakery would have a government employee whose only job is to make sure they pay taxes.

Hopefully never comes to Canada. But now you know why 2 million people have fled.
————————————————————————————————
It’s the samehere only no one moves in with you. You just subsidize the rent with taxes and empty house fees,

#95 Dirty SHYSTER on 05.08.18 at 10:06 pm

@For those about to flop…

1.1m for dublin
1.77m for Malahat ave

#96 feldspar freddy on 05.08.18 at 10:15 pm

Ah, you are back in stride again, writing on the most important matter facing us and exposing what all these attacks on those who choose to work and save REALLY means. St.Petersburg, 1917. Hope we fare better than the Czar and family.

#97 Myra Andrews on 05.08.18 at 10:22 pm

Greater Vancouver Stats from realtor Paul

May 8 New 318 Sold 117 TI 10835
May 7 New 389 Sold 131 TI 10697

May 4 New 191 Sold 110 TI 10540
May 3 New 213 Sold 103 TI 10503
May 2 New 268 Sold 146 TI 10481
May 1 New 363 Sold 134 TI 10420
Apr 30 New 375 Sold 163 TI 10349

April 16-27 New 2453 Sold 1224 TI 10,347
April 3-13 New 2111 Sold 916 TI 9727

Mar 19-29 New 1834 Sold 1072 TI 9032
Mar 5-16 New 2248 Sold 1224 TI 8743

The inventory at the end of February was 8211

#98 JSS on 05.08.18 at 10:30 pm

wealth redistribution is a necessary part of keeping the economy moving. Money would accumulate and be hoarded by the rich if it weren’t pushed back down to lower wage workers somehow. Then we’d have stagnation.

I personally know of no rich people ‘hoarding’ money. They usually own businesses employing people and making the economy function. The main wealth hoarders seem to be homeowners. – Garth

#99 Long Branch Apprentice on 05.08.18 at 10:42 pm

#79 Niagra Region

1) Not one labourer would count you among them,

2) https://youtu.be/tagm6dGxmh4

What do you actually DO? You go to conferences no one cares about to give presentations no one cares about so you can write papers no one reads in order to justify your grant proposals. Then you piss and moan about student debt and how underpaid you are. The current university model is obsolete and so is your mode of thinking. I have an M.Sc. and it’s not worth the paper it’s printed on. Don’t lecture me on how hard up professors are, you live off the state and produce nothing of value. If you’re so down with workers why not show up at a worksite with your fall arrest and tool belt? Because you think you are superior to anyone with callouses on their hands. Your Ivory Tower dream is only facilitating your misery and economic woes.

You’re bitter you’re not living the life your academic supervisors baited you with, like so many others. You churn out vapid drivel like the rest of your ilk.

Oh, your spelling and grammar sucks too. Probably because you never delevoped critical thinking skills. If you had, you wouldn’t be in your current predicament.

#100 Samuel on 05.08.18 at 10:49 pm

Re: #88 Azyan on 05.08.18 at 9:30 pm

Um….notice how the property tax rate decreases as real estate prices are higher in the listed cities? Would stand to reason tax dollar values are actually more similar. And if they pay the same dollar amount those in Vancouver pay much more for the “privilege” of being a homeowner. And salaries are no higher in Van. And garbage pickup and street lights cost the same.

Yeah

#101 FOUR FINGERS WATSON on 05.08.18 at 10:52 pm

And they save nothing. It’s notorious behaviour among academics and teachers. – Garth
………………………

They don’t have to, they have gold plated pensions…..Why live like a refugee ?

#102 For those about to flop... on 05.08.18 at 10:55 pm

Pink Pollen falling in Vancouver.

These guys just went extreme in an attempt to become relevant in the marketplace again.

They just magic erased 1.2 million off the ask and and are now asking less than purchased for way back in 2015.

Broadway Skytrain wants a 50 foot block,have at it…

M43BC

3329 Puget Drive, Vancouver, Paid 3.26. November 2015 ass 3.41

2018-01-29 : $4,188,000
2018-05-08 : $2,999,000

https://www.zolo.ca/vancouver-real-estate/3329-puget-drive

https://www.bcassessment.ca/Property/Info/QTAwMDAwMEwwNg==

$$$$$$$$$$$$$$$$$$$$$$$$$$$$

Feel free to make a donation.

Flop For Fox Fund…

http://www.terryfox.org/get-involved/ways-to-give/

#103 Samuel on 05.08.18 at 10:56 pm

Garth, you are sending out a warning to those of us still in the main accumulation phase of our wealth. To avoid being singled out in the future it’s likely wise to have a middle class home paid off in full. Max TFSA’s and RRSP’s. Invest nothing else. Spend it on cars (one per person), restaurants, beer, and vacations instead. Don’t be the tall blade of grass.

#104 al on 05.08.18 at 11:03 pm

“Wealth taxes are the rage in academia among professors who have tenure, cannot be fired and have life-long defined-benefit pension plans (publicly-funded, so they need not save anything)

Nailed it.

Include the NPV of any public employee’s pension pot in a Wealth Tax calculation – and you’ll suddenly see a massive change of heart.

Assume a tenured prof was late to the game (after all, they had some learning to do), and can therefore retire at 60. 80% of final salary is the usual PS going rate, and from what I’ve seen many profs are at $180k/yr.”

I see the distrust in academia and experts is strong here including our host. One may be surprised to know that ppl earning 180k/year also accumulate a fair amount of assets outside of their pension throughout their working career. You should check out the ideally located homes and chalets of sexagenarian profs.

#105 Hiding On the Backstreets on 05.08.18 at 11:04 pm

“If you like this stuff, you know how to vote. If you don’t, learn a lot more about tax avoidance, get a fat liquid portfolio and go live quietly among the masses.”
______________

Excellent stuff. Great article today. But voting won’t matter. The indoctrination has been slow, steady and insidious. Decades in the government brainwashing camps.

Most people don’t understand, nor care to understand, that governments will not, cannot, and won’t ever attempt to pay off the debt. It is impossible in our fiat currency system.

The goal posts have shifted so far left over time, even the PCs dare not discuss smaller governments and tax cuts. It’s widely accepted as the government’s obligation to raise children and provide shoot-up clinics for the parasites.Watch the election campaign for Toronto this year…er…I mean…Ontario. The MSM is the government’s propaganda machine.

Steadfast and deliberate skimming of citizens’ prosperity. The best thing the average person can do is to understand and protect himself. Shield your wealth from governments. You’re on your own, people.

#106 bring it on on 05.08.18 at 11:05 pm

“And they save nothing. It’s notorious behaviour among academics and teachers. – Garth”

Why don’t you shut up about professions that you have no clue about. Most profs only begin to earn a decent salary when they get to be about 40, and spend there entire 20s learning the trade living on 15K a year. In their 30s they then earn their stripes at a university rising in the ranks if they are good at their jobs. Without us in STEM and CPSC there would be a severe lack of skilled people to make key innovations in start-ups that push the frontier forward. It is just not something that can be learned in a “coding-course” from a night-school class at a community college. Indeed we are typically very late in starting to save offline out of the DC pension plan that are offered at the majority of the universities in Canada. It is a quite different scenario than some dope who gets a free ride in a family business and starts earning big bucks in their 20s. This is something I know very little about, and so no need to put in my bias like you do against us in academia.

#107 bring it on on 05.08.18 at 11:11 pm

You have some of the most vile people who comment on your website. Times are a changing, and within 20 years from now all of these vile old people will be on the wrong side of the grass fortunately; and you wonder why our society is being increasing polarized?… just read # 99 who knows zip, nada, about what he is talking about….. the earth should just swallow up and eat him whole…

#108 DON on 05.08.18 at 11:12 pm

#55 and 92 Bobby

Christy Clark / Rich Coleman is that you?. Why did the BC Liberals…allow all this corruption to take place? Who is slim my enough to support such incompetence? FFS! Grow up bobby.

#109 For those about to flop... on 05.08.18 at 11:16 pm

#95 Dirty SHYSTER on 05.08.18 at 10:06 pm

@For those about to flop…

1.1m for dublin
1.77m for Malahat ave

////////////////////

Hey Dirty,I dunno if you are yanking my chain but I will take your word as I always revisit it when it becomes official on the database and I need all the help I can get to report in real time.

I’ve had more extreme results so anything is plausible.

Thanks for your help.

So …7720 Malahat Ave,Richmond. Paid 2.15 April 2017

Sold for 1.77

Could be a half a million dollar loss and now I have to look forward to someone writing me and tell me they were Chinese or gangsters washing money.

I don’t care ,I just report the numbers.

2219 Dublin Street, New Westminster paid 1.07 March 2016 ass1.07 1.15

Sold for 1.1
Dunno Waiverless and LS in Arbutus are better at this than me ,I just do rough and ready and say 45k loss.
I guess no trip to Ireland for these guys after all…

M43BC

$$$$$$$$$$$$$$$$$$$$$$$$$$$$

Feel free to make a donation.

Flop For Fox Fund…

http://www.terryfox.org/get-involved/ways-to-give/

#110 Fake News Again on 05.08.18 at 11:47 pm

Terrie Rolph on 05.08.18 at 9:27 pm
“(publicly-funded, so they need not save anything)”
This statement is misleading. The professors (and others with pension plans through their employers) have a significant percentage of their salaries deducted at source.

And they save nothing. It’s notorious behaviour among academics and teachers. – Garth

________

1. 100% of your inflated salary comes from the taxpayer.

2. The 50% “you” put in (from your taxpayer funded salary) is not significant. The other 50% comes from the taxpayer that does not get a pension that equals 70% of your best earning years at 60 years old where you can go lie on a beach in Mexico for 25 years while my Grandma needs to be a Walmart greeter to survive.

3. In BC anyway……teachers get 3 months off including summer, easter, xmas and “pro D (day off) Days”.

4. Plus medical benefits, massages, travel coverage and other goodies we SLAVES of the Govt do not get……

And Govt Workers wonder why the public is so pissed off…..

#111 Hindsight on 05.08.18 at 11:48 pm

70% Garth……70% !!!!!!

https://www.theglobeandmail.com/investing/investment-ideas/article-housing-bubble-not-just-the-bank-of-canadas-fault-manulifes-day-has/

#112 WiseGuy on 05.08.18 at 11:52 pm

Tax avoidance is legal, but what isn’t legal is the fraud that has been going on for years with individuals sheltering their ‘income properties’ in corporations and writing off everything under the sun to avoid ever showing a profit.
To think that this is not happening is highly naive. I have two individuals in my district at work that brag about how they got renovations done on their family home and write it off through this corporation, essentially increasing the value of their home and not paying taxes on gains. And that’s just one way that this tax fraud has been happening.
Government is aware that fraud happens with these corporations, but their hands are tied as this is done legally with accountants that know tax law. These speculation and empty house taxes are not taxes on the rich, but more like taxes on people that have found a very easy loophole with our tax laws.

#113 WiseGuy on 05.08.18 at 11:54 pm

When I state that they don’t pay taxes on their gains, I meant that they avoid paying taxes on that rental income sheltered in the corporation.

#114 Linda on 05.08.18 at 11:54 pm

‘That’s perfectly ok with the majority who feel entitled to things they can’t actually afford’. Bingo! Somehow we’ve ended up with a lot of people expecting to live the lifestyle of the rich – or the perceived rich – without having to work & wait for literal decades before that lifestyle was achieved.

While I doubt I’ll live long enough to see it, it would be fun to see how these selfsame folks react when they in turn are targeted because the next generation perceives them as having stuff they want but can’t afford, because by then those folks will likely be considered ‘rich’, regardless whether they actually are.

#115 Exodus2020 on 05.09.18 at 12:05 am

Stop whining…… A significant chunk of the increase in real estate prices is due to the desirable neighborhoods with desirable schools, it’s part of what made Vancouver the “most livable” city for several years… so why shouldn’t the benefactors shell out more dough to pay for the amenities that helped drive up their equity.

#116 Dolce Vita on 05.09.18 at 12:11 am

“But move into a $4 million house producing no income, and you’re a social pariah who deserves a tax spanking. Paleo thinking.”

NO IT’S NOT Paleo.

Let me explain it to you in human nature terms.

Maslow’s Hierarchy of Needs (generally accepted as fact and not fiction):

The first 3 needs are about “self” (actualization, esteem, love).

The 4th need concerns a roof over your head as in SAFETY (and all that goes with that).

So you see, your $4 MM investor does not threaten anybody’s safety that is looking for a roof over their heads.

Your $4 MM home owner DOES (makes it near impossible for the average wage earner to purchase such a home or anything cheaper).

I have yet to read about any of these $4 MM home owners going all egalitarian and selling at a much lower price; rather, greed and avarice is more like it.

Human Nature. You wrote about it. There it is.

#117 For those about to flop... on 05.09.18 at 12:27 am

Pink Pollen falling in Burnaby.

These guys just chopped 250k off this Vancouver Special in Burnaby

They were asking 1.75 after being on the hook for 1.67.

New price 1.48,don’t this sort thing before when they done a drastic drop.

Didn’t work then but this one is more extreme,which seems to be the order of the day to get their fair share of attention.

Recency bias.

For 15 years the houses sold themselves…

M43BC

4062 Venables St,Burnaby.

Paid 1.67 April 2016

Asking 1.75

Were asking 1.59 at one stage.

https://www.zolo.ca/burnaby-real-estate/4062-venables-street

https://www.bcassessment.ca/Property/Info/QTAwMDAzVlI3SA==

$$$$$$$$$$$$$$$$$$$$$$$$$$$$

Feel free to make a donation.

Flop For Fox Fund…

http://www.terryfox.org/get-involved/ways-to-give/

#118 Fortune500 on 05.09.18 at 12:44 am

Garth, I don’t think I have heard your perspective spelled out in regards to why you think it would be unfair/wrong for people to be taxed on the capital gains made on their primary residence? Could you explain your thoughts on this?

If I buy a killer stock and make $100,000 on it I will need to pay tax on those gains. But if someone in Toronto makes $200,000 in a few years on their home, they get to keep it all tax free. How does this make sense? Doesn’t it just encourage people to move all of their money into speculating on housing? The government is basically begging me to do just that.

Homes were once for living in when they appreciated along with inflation. But since the government has encouraged and rewarded speculative behavior and property investing as they have, why do we still act like it is something else?

#119 Stan Brooks on 05.09.18 at 12:58 am

Pediatricians get guidance on kids’ gender diversity as more parents seek answers

https://ca.finance.yahoo.com/news/pediatricians-guidance-kids-apos-gender-040216442.html

democracy requires taxes. pay up.

#120 Whimp on 05.09.18 at 1:06 am

Defined benefit pensions aren’t “All that” Government jobs always pay a lower wage than contractors or big business since it’s not right for the government to take their taxes and steel their employee’s by paying them too much (of course all lazy, evil government employee’s are overpay’d, underworked heathens) So, on top of a lower wage, the government garnishes all employee wages for a massive pension contribution. This equals half a mortgage payment, or a new car payment every month, it’s mandatory and you can’t opt out of it at any time. The money goes to a pension fund where the contributing employee’s have no say what it’s invested in. Just like with so many other things in the world today, the boomers that are retiring and drawing their defined benefit pensions are benefiting. However, do the math and you’ll see that all the government pensions, (Postal service is a good example) are top-heavy. Too many people drawing and not nearly enough contributing. So, pay in all your life, instead of being able to invest it yourself and be in control of it, then get nothing back, or very little. Yeah, pretty awesome! I’m supporting the boomers with my pension contributions, living in the poor house and listening to them call me stupid for not owning a house (they might be right with the way rent prices are) If I had a choice, I’d opt out of defined benefit pension in a heartbeat! I could invest that money way more wisely!

#121 Buy? Curious? on 05.09.18 at 1:29 am

DELETED

#122 jane24 on 05.09.18 at 1:41 am

Garth why do you keep hitting on this? You know that most of us blog dogs disagree with your premise that homes are an asset class and not family shelter. A country where my professionally qualified nieces and nephews in Vernon and TO will never own their own home is a disgrace and I am as old and right wing as folk come.

But will it change – never, or at least till the next generation gets off their collective bums at election time and vote. Kids you can protest in the streets all you want but you do have the power to change the govt by forming better parties, running better people and then voting for them. But you are either too dumb or too lazy to do it. My three kids in their 30’s are always the only ones among their friendship groups that go to the polls as their mother insists on it.

You don’t like the current voting choices? Then make a new one. Trump did.

#123 yawbawdy on 05.09.18 at 1:45 am

0.2% more tax on value between $3-4M and 0.4% on anything over $4M = a couple tanks of gas/month in YVR. Why is this even an issue?

#124 B20 Bust on 05.09.18 at 2:24 am

The Dipper finance minister in BC has suggested the extra property tax on high-end properties might some day morph into a general wealth tax – which is exactly what folks owning nice houses fear. Tax based on possessions, not income nor the ability to pay, do not have a legacy in Canada.

———

Taxing income is fine as long as people actually declare their true income and pay their taxes.

Richmond and West Vancouver have the highest real estate prices in Canada.

Oddly enough, these same communities have the highest percentage of residents declaring poverty level earnings. Andy Yan’s data shows that 33-50% of residents in Richmond and West Vancouver and low income.

There are a lot of ‘students’ and ‘homemakers’ listed on the titles of multi-million dollar homes in these communities, as Andy Yan’s analysis also discovered.

And please, do not try to say they are all retired living on fixed incomes and hence ‘poor.’ Vancouver has the same proportion of ‘retired’ individuals living on fixed incomes as every other city in BC, and North America.

And lets not forget that taxing income did not work out quite so well for the over 200,000 entrants under the now defunct investor immigrant program. Over the past 30 years, the federal government’s own report showed that 2/3rds paid an average of $1600 in taxes – less than a refugee or nanny – and 1/3rd did not pay any taxes!

The locals are tired of rampant tax evasion, so they support going after the possessions of those that evade to send a strong signal to others. If they do not want to pay income tax, they can pay with their prized possessions.

#125 Nick on 05.09.18 at 3:57 am

If they started taxing capital gains on primary residences, wouldn’t they similarly need to allow for deductions for costs such as interest payments, maintenance, renovations and property taxes?

If it’s to be treated just like any other “investment” then all those costs are relevant (similar to interest and expenses on investment income).

I’d be then curious to see exactly how much “capital gains” there actually are. Perhaps this push may be a ploy by the banks to incentivize being forever mortgaged.

#126 Myra Andrews on 05.09.18 at 4:05 am

Zolo no longer shows price drops.

MLS® R2258585 Price:$459,900

On Zolo it shows the lower price of $399,900 but there is mention of the original list price of $459,900 under the same MLS number.

Zola says “Apr 17, 2018 $399,900 Listed For Sale”

But it was actually listed for sale for $459,900 on April 17

A few weeks ago Zolo would show the initial list price but they just stopped doing that. Wonder why.

http://macrealty.com/home/Townhouse/10-21960-river-road/Maple-Ridge/BC/V2X%202C3/mlsR2258585/rebgvvrebvirebomreb/

https://www.zolo.ca/maple-ridge-real-estate/21960-river-road/10

#127 Myra Andrews on 05.09.18 at 4:07 am

Sorry should have said

but there is NO mention of the original list price of $459,900 under the same MLS number.

#128 Howard on 05.09.18 at 4:36 am

Immigration should be reduced to put upward pressure on wages until the average Canadian wage approaches the average American wage. Even then it still wouldn’t be equal given Canada’s higher cost of living.

The median Canadian household income is $76,000. The median US household income is $56,500 ($70,600 Cdn). Maybe we need more foreign-educated citizens who can Google. – Garth

#129 Steve French on 05.09.18 at 6:03 am

Hi agree with Garth:

All teachers and academics are leaches on society, more or less worthless and they are incapable of saving a single dime. Plus their jobs are a joke, they do no work, and they sail through the education system without lifting a finger, moving on swiftly to literally (not figuratively) gold-plated fully tenured positions, where they can never be fired, the vast majority living in $3 million mansions.

Meanwhile, its the forgotten hard working billionaires are out there such as the Walton family who are creating jobs for the rest of us in society.

Right on Garth. Freedumb rulez!!!

None of which I said. But feel free to embarrass yourself. – Garth

#130 Tater on 05.09.18 at 7:17 am

#2 Spillover on 05.08.18 at 5:08 pm
You can have $4 million in a liquid portfolio turning out $300,000 in low-taxed income and nobody cares. But move into a $4 million house producing no income, and you’re a social pariah who deserves a tax spanking. Paleo thinking. But it’s spreading among the political class.

————–

Its because real estate continues to be the only asset class that doesn’t have to pay capital gains taxes if you sell your principle residence.

When the owner of the $4 million dollar house sells, they get a tax free windfall. When the owner of the $4 million portfolio sells, they get a huge capital gains tax bill.

If you eliminated the principle residence exemption for capital gains, a lot of the angst would dissipate.

The average person pays capital gains tax on everything. I invest 5k into a stock and it doubles, I pay half of half on the gain. When someone else puts down 5k for a condo presale, and then moves in for a year and sells, they pay nothing on a leverage gain, yielding far higher returns.

People pay tax on the interest ‘growth’ in a GIC. Why should they not pay tax on the ‘growth’ of their home.

The political class is starting to clue in that there is no rationale for exempting real estate.

Give me one reason why the principle residence exemption should stay?
—————————————————————–

Ok, but much like any investment, interest cost needs to be allowed as a write off, along with maintenance, property taxes, real estate comissions etc. Of course, if that happened, people would realize what a massive money suck home ownership is.

#131 young & foolish on 05.09.18 at 7:34 am

The Politics of Envy is leading the way ….

#132 Why I aughtta! on 05.09.18 at 7:43 am

Wow. Long Branch Apprentice sucks – what a weirdo, did a teacher whack you across the knuckles with a ruler and damage your psyche?
I see teachers like I see farmers and even doctors, lots of work to get to a job that few want to do – farmers get next to no pay and doctors get loads but both provide essential services to humanity- much like teachers. Anyone who thinks teachers have a cushy job and easy livin’ has never been one. Precarious work, competetive and the only reason to stay is for the love of teaching itself – in my early years there were teachers that really inspired and supported me in a way my loving parents couldn’t. (and what about kids with little or no parental support?) Profs can help inspire and form students into more than they could be from online courses or nurture alone – I feel they offer an essential service to an increasingly disinterested youth.
Typical that Long Branch would bring up Peterson, what a moron- spouting crap to sound intelligent when all he has is a dog whistle.

#133 Conn Smythe on 05.09.18 at 8:01 am

#116 Fortune 500

“Homes were once for living in when they appreciated along with inflation. But since the government has encouraged and rewarded speculative behavior and property investing as they have, why do we still act like it is something else?”

If the home is not your principal residence it is taxed as any other capital gain investment. The government, albeit far too late, is now trying to nail the house speculators with a capital gain by having them declare the sale on their tax returns.

#134 Sigmund Freud on 05.09.18 at 8:03 am

#114 Dolce Vita

You have your Maslowian steps in the wrong order. Self esteem is a higher order need, not a lower one…

#135 akashic record on 05.09.18 at 8:06 am

I personally know of no rich people ‘hoarding’ money. They usually own businesses employing people and making the economy function. The main wealth hoarders seem to be homeowners. – Garth

I personally know of no rich people who are not homeowners, but most of them generate their wealth owning businesses, employing people.

My point was simple and should have been clear: the greatest pool of unproductive wealth (creating no jobs and no income) sits in the residential real estate of 70% of the population. It is not in the bank accounts of the .001%. – Garth

#136 young & foolish on 05.09.18 at 8:08 am

“Most people don’t understand, nor care to understand, that governments will not, cannot, and won’t ever attempt to pay off the debt. It is impossible in our fiat currency system.”

Truer words have never been written. Your cash ain’t nothing but temporary “notes” of temporary value. Best to own hard assets or shares in income producing businesses. Some insist on gold, but that is questionable.

Without liquidity there is no secure life. – Garth

#137 Dave Ahem on 05.09.18 at 8:11 am

“the history of all hitherto existing society is the history of class struggles” Karl Marx.

#138 TurnerNation on 05.09.18 at 8:12 am

Banging the UN Mandated drum of “Density” and total government control (Google Sidewalk labs designed condo development coming to Toronto is part of this)

http://www.cbc.ca/news/canada/toronto/rental-prices-climb-in-gta-1.4654523

“The government left it up to the private market to make decisions,” said Carlson. “We’ve seen single detached homes put up in our suburbs. What we really need there is more density.””

SURE..when this “World class” craphole city’s transit is overcapacity. This place is a haven for Party Elites, Public Unionistas and Bankers.

https://www.cp24.com/news/ttc-will-add-another-train-on-line-1-amid-historic-overcrowding-during-morning-rush-1.3920327

#139 Conn Smythe on 05.09.18 at 8:13 am

#99 Long Branch Apprentice

Your comments are spot on. I would go one further than you. I have seen PhDs at my high school who looked down on regular high school teachers, forget the labourers.

By the way, Niagra Region, Niagara has two “a”s in it and labourer is spelled with a “u” in Canada. You make yourself look really bad with your poor English. You are an academic after all…

#140 crowdedelevatorfartz on 05.09.18 at 8:16 am

@#75 Reynolds.
“They also are trying to implement a program where they hire a staff member in independent businesses to make sure you’re paying your share to the government. So the bakery would have a government employee whose only job is to make sure they pay taxes.”
+++++
After our company was just auditted by the Provincial PST collectors ( 4 days of pulling files, photocoping, endless queries….found nothing)

Isnt that a fairly accurate description of Canada’s multijurisdictional tax collection industry?
Canada:
Formerly a nation of Hewers of water, gatherers of wood.
Now. Hewers of emails, gatherers of paperwork.

#141 Luc on 05.09.18 at 8:24 am

One of your best blog post ever

#142 John of Grant on 05.09.18 at 8:24 am

#2 Spillover on 05.08.18 at 5:08 pm

Give me one reason why the principle residence exemption should stay?
———————————–
Why is more taxes the answer? Get rid of capital gains taxes on stocks. The corporate tax has already been paid. Double taxation.

#143 crowdedelevatorfartz on 05.09.18 at 8:25 am

@#95 Dirty SHYSTER

Just curious, have the phones really stopped ringing or is that media hype?

#144 CJBob on 05.09.18 at 8:33 am

“If you like this stuff, you know how to vote.” – Garth
____________________
It would help in Ontario if Rob Ford could develop policies and a plan on how he going to cut spending instead of just parroting things like ‘finding efficiency’ and ‘cutting the fat’. And then follow through on them.

He could start by committing to changing the laws around separate school boards in Ontario which results in a huge amount of duplication.

#145 crowdedelevatorfartz on 05.09.18 at 8:36 am

@#130 Bang! Zoom! to the Moon aka Why I aughtta
“Precarious work, competetive and the only reason to stay is for the love of teaching itself – ”

++++

Ummm , I hate to disagree but most of the teachers I have met are in it for the garanteed money($75k/year starting out?), the job security that unionization bring and , oh yes, almost forgot, that excellent garanteed pension $$$$$.
I spoke to a teacher the other day at the barber shop,
Working almost 10 years, Had his Masters of Education, bragged he was pulling in $85k/year.
Doesnt do any extra curricular activities with the school sports, music, etc as the “extra work” has become a union negotiation blackmail tactic in BC.
He’s bored and was thinking about becoming a Principal because ( and I quote), “They make over $100k per year depending on the school district”

Your profession may have been “about the kids” a generation of two ago…..Now?
Its all about the money.

#146 akashic record on 05.09.18 at 8:37 am

I personally know of no rich people ‘hoarding’ money. They usually own businesses employing people and making the economy function. The main wealth hoarders seem to be homeowners. – Garth

I personally know of no rich people who are not homeowners, but most of them generate their wealth owning businesses, employing people.

My point was simple and should have been clear: the greatest pool of unproductive wealth (creating no jobs and no income) sits in the residential real estate of 70% of the population. It is not in the bank accounts of the .001%. – Garth

Creating residential real estate requires the purchase of plenty of labor, which is the income source of non negligible segment of the population.

On the other hand, what would you suggest to change?

Who should be the owners of the horribly unproductive, but necessary residential real estate wealth?

Companies, which would turn the same “unproductive wealth” into “productive” residential rental business that creates wealth for the company shareholders?

#147 CJBob on 05.09.18 at 8:44 am

#124 Myra Andrews on 05.09.18 at 4:05 am
…but there is [no] mention of the original list price of $459,900….
__________
I’ve never understood why anyone cares what the list price is. The only thing that matters is selling prices. If you’re buying a house get to know the local market by visiting many home and getting a strong sense of the actual price homes are selling for.

Price anchoring is a bias we are ALL susceptible to without knowing it. The first question in an open house is usually ‘what is it listed for?’ It’s much better to not know. Look through the place and reach your own conclusion what you think it is worth BEFORE finding out what it is listed at:

http://www.finehomebuilding.com/2016/12/26/psychology-price-anchoring

#148 Buy? Curious? on 05.09.18 at 8:48 am

Whoa, whoa, whoa! Deleted? Fair enough. In hindsight, I may have gone a little too far with the poetic license. Do you mind if I try again?

I think the older cohort is misguided in their belief that the younger cohort feel that they’re entitled. If you’ve been around the older cohort for any amount of time recently, you’ll find that they complain about everything, state of politics, cultural shifts and of course their health. (That last one I love listening to! It’s like a mashup of Beethoven and Biggie Smalls!) I do hope the older cohort is patient and share but if not…the younger cohort may become upset.

#149 Conn Smythe on 05.09.18 at 8:50 am

#130 Why I aughtta!

“I see teachers like I see farmers and even doctors, lots of work to get to a job that few want to do – farmers get next to no pay…”

Are you for real on your farmer comments?? Canadian dairy farmers are very wealthy. Canada has a supply managed quota system and effectively has made Canadian farmers very, very wealthy individuals. One of Trump’s major attacks was on our dairy system and its lack of competition. I personally know dairy farmers who are worth north of $15 million in assets. Here is a typical dairy farm for sale in Ontario. Do you have $9 million to buy this poor farmer’s farm?

http://www.farms.com/farm-real-estate/farms-for-sale/ontario/dairy-farm-for-sale-east-garafraxa-ontario-1023.aspx

#150 dharma bum on 05.09.18 at 9:13 am

“…get a fat liquid portfolio and go live quietly among the masses.” – Garth
——————————————————————–
Right on.

“Displaying riches and titles with pride brings about one’s downfall.” ~ Lao Tzu
[Tao Te Ching chapter 9]

#151 PastThePeak on 05.09.18 at 9:14 am

A wealth tax is inevitable. During one of the stronger global growth periods in the last decade, with record low unemployment, ALL Canadian gov’ts (federal, provincial, large municipal) are in deficit – and often by A LOT. Total increase in Canadian public debt (including off books crown corps) is likely around $50B/year.

That’s right – during (somewhat) good times and economic expansion – no one can balance the budget. As Garth notes, income tax on the high end is already at 53% in some provinces, and kicking in at less than $200K USD (for global comparisons). Despite that recent federal increase, the new amount brought in wasn’t close to their estimates. They could make that 60% and it wouldn’t do much for revenue.

So while the gov’ts of the day have no issue borrowing ever more, it still isn’t enough and so they will be raising taxes in other areas. The GST/HST might be a target (post federal election) as it would have the biggest impact on tax revenue, but the left wing parties (supported by about 65% of the Canadian electorate) are increasingly targeting the “wealthy”.

The only question is how they will do it (federally, and in the other left-wing provinces).

#152 PastThePeak on 05.09.18 at 9:27 am

#116 Fortune500 on 05.09.18 at 12:44 am
Garth, I don’t think I have heard your perspective spelled out in regards to why you think it would be unfair/wrong for people to be taxed on the capital gains made on their primary residence? Could you explain your thoughts on this?

If I buy a killer stock and make $100,000 on it I will need to pay tax on those gains. But if someone in Toronto makes $200,000 in a few years on their home, they get to keep it all tax free. How does this make sense? Doesn’t it just encourage people to move all of their money into speculating on housing? The government is basically begging me to do just that.

Homes were once for living in when they appreciated along with inflation. But since the government has encouraged and rewarded speculative behavior and property investing as they have, why do we still act like it is something else?
+++++++++++++++++++++++++++++++++++

How many people do you know who buy and move every couple of years, for the purpose of increasing their wealth? This is principal residences, remember. You have to live there for a year to quality. Every time they sell/move, they pay 4-5% commission, land transfer tax, moving costs, etc.

So to speculate on housing and (legally) not pay cap gains, you need to “keep on moving”. A single person might, but can’t see anyone with a family doing it. I personally know of no one who does this, outside of a few contractors who build their own homes, live there for a few years (like 3-4 min), and then repeat. It is in the build part where they make/save the most money (doing more themselves). But this is rural and low numbers.

And Garth can correct me if I am wrong, but I am sure it is within the CRA’s ability to assess such an activity as a business type activity (how are you earning most of your money), and re-assess taxes owing accordingly.

As others have pointed out to you and the “tax ’em” crowd, if capital gains are to apply to sale of principal residences, then so should the decidability of costs of purchase, sale and carrying also apply (mortgage interest deductible every year, property taxes, commissions deductible, legal fees, etc).

AND, for a long held asset like a house, the cost of inflation should also be taken into account, so if one purchased a house and lived in it for 30 years, then the inflation rate should be used to determine the adjusted cost base at sale time.

Take into account all of that, and very little capital gains would be realized anyways, though at a much higher cost and complexity of the tax system.

…but these points won’t change any or the “tax ’em” crowds opinions anyways…

#153 Clint on 05.09.18 at 9:30 am

“people have been borrowing what they don’t have to get what they want.”

Yep! I have no problem with people doing this, as I’m pro freedom. But freedom to win also means freedom to fail. If you fail doing stupid then you can whine all you want, but don’t expect me to pay for your stupid.

#154 jess on 05.09.18 at 9:36 am

..”Creative Housing takes it one step further. The group’s proposed model includes a deal in which the city provides land free as long as affordable housing is built and maintained on it in perpetuity.

It’s also in talks with the Canadian Mortgage and Housing Corporation to receive financing that freezes lending at today’s interest rates for a 10-year period, Keesmaat said. Most of the equity will come from private institutional lenders. The nonprofit hopes to start building as early as next year. A spokeswoman for the Canadian housing agency declined to comment on the talks.”..bloomberg

#155 LivinLarge on 05.09.18 at 9:43 am

“The median US household income is $56,500 ($70,600 Cdn). Maybe we need more foreign-educated citizens who can Google. – Garth”…LOL, cracks me up because it’s just SOOOOOO true. L

I have come to the unfortunate conclusion that the comments section contributors are the online equivalent to the early Boomers you see sitting at Timmies or McDs for hours at a time mid day. Always bitchin’ about the Mils and waxing on about how they walked 10 miles to school barefoot even in winter. Just “back in the day…”.

Nothing ever changes so much as it stays the same.

#156 Big Kahuna on 05.09.18 at 9:43 am

#123-NICK-not necessarily-the guv could simply use a discounted capital gains tax rate and ignore all expenses-say 20% of the the gain is brought into income and taxed fully.

#157 Dominoes Lining Up on 05.09.18 at 9:45 am

Speaking of “stuff” to buy, I wonder if anyone has had a similar experience to mine lately:

The last three weekends I have spent a lot of time heading out to the usual second tier shopping plazas near where I live and work in the 416, picking up spring items and for a bunch of birthday gifts for friends and relatives born around this time.

In every plaza it seems, big or smaller, something happened April 30. Stores that were open that day were closed up and had their windows papered over by May 1 or the week after when I returned, some with ‘thank you’ notes to their customers for years of operation.

Was May 1 some kind of trigger event for another drop in retail sales with a wave of lease cancellations?

It’s really weird to be in half a dozen plazas and suddenly see 10-20% of the usual stores gone, almost overnight.

Anyone else been noticing stuff like this?

#158 BMO starting mortgage rate wars on 05.09.18 at 9:47 am

http://business.financialpost.com/real-estate/mortgages/mortgage-wars-heat-up-as-bmo-offers-variable-rate-at-biggest-discount-ever#comments-area

#159 IHCTD9 on 05.09.18 at 9:50 am

#178 Eddy Haskel on 05.08.18 at 5:03 pm

Let me put this in perspective for you. I have been mortgage free for 30 years…. For my property to lose it’s tasty capital gains, we would have to have Great Depression like deflation. I know people who bought homes in the 50s for 20k whose homes are now worth 100 times that at 2 million.
________________________

If you could have got 2 million for your house last year – but today you can only get 1 million for it – you’ve lost 1 million in tasty gains no matter when you bought or how much you paid.

How’s that for some perspective?

#160 For those about to flop... on 05.09.18 at 10:07 am

Latest article from howmuch…

M43BC

“The Best Schools for Under $20k in One Map

Here’s a fact: more than 70% of college graduates carry student loan debt, and the average debt burden stands at $37,172. A surprising new study reveals that the problem affects millennials just as much as baby boomers. These figures got us thinking about the best schools that won’t break the bank, so we compiled a new map of the top universities in every state costing less than $20,000 in annual tuition and fees.

We compiled the data from U.S. News & World Report’s annual Best College Rankings. We captured the top-ranked college in every state costing less than $20k each year in tuition and fees (excluding room and board). We then color-coded each state in a heat map to represent the relative cost of the best higher education—light blue states are cheaper than dark blue states. We added the school’s logo for quick reference. This snapshot lets you quickly and easily see where getting a degree at a reputable institution costs the least.

Top Ten States with the Cheapest Flagship Universities
1. Wyoming – University of Wyoming: $5,218

2. Utah – Brigham Young University, Provo: $5,460

3. Florida – University of Florida: $6,380

4. New Mexico – University of New Mexico: $7,146

5. Montana – Montana State University: $7,150

6. Idaho – University of Idaho: $7,488

7. Alaska – University of Alaska, Fairbanks: $7,520

8. Nevada – University of Nevada, Reno: $7,599

9. Mississippi – University of Mississippi: $8,290

10. North Dakota – University of North Dakota: $8,447

There are a couple of caveats to keep in mind. Many public universities charge different rates for students who already live in that particular state and students who live in another state. For example, the University of Iowa will only charge Iowa residents $9,190, but the school will charge nonresidents $30,834, or more than three times as much. It’s worth noting, however, that some universities have reciprocal agreements with other states, where they agree to charge the resident tuition rates for nonresidents, like the agreement between Wisconsin and Minnesota. In other words, don’t automatically assume you can or cannot pay the tuition rates listed on the map. It always pays to check.

In fact, most people don’t even pay the published tuition rates. Fully two-thirds of college kidsreceive some sort of financial aid in the form of scholarships or grants. That means that if you can combine a scholarship with a low tuition bill from one of these schools, you will be in the best possible position to escape student loan debt altogether.

All that being said, there are several key insights on our map. From a geographical perspective, there are affordable top-ranked programs in every region of the country. The West tends to have a higher number of inexpensive universities, like the University of New Mexico ($7,146) or Montana State University ($7,150), but similar price points can be found out East, too. Affordable education is available especially in places like Florida, West Virginia, and Maine. Even in New York, Binghamton University costs just under 10 grand.

What’s the main takeaway from our map? The least expensive top-ranked school is the University of Wyoming, where it only costs $5,218 each year in tuition and fees. Looking across the entire country, though, there are 28 states with schools under $11,000 and 46 under $16,000. All this goes to show that getting a degree is always a serious investment, but you don’t necessarily have to take on a mountain of debt to graduate.”

https://howmuch.net/articles/best-college-that-costs-less-than-20000

#161 Conn Smythe on 05.09.18 at 10:21 am

#157 IHCTD9

“If you could have got 2 million for your house last year – but today you can only get 1 million for it – you’ve lost 1 million in tasty gains no matter when you bought or how much you paid.

How’s that for some perspective?”

First, a drop in 1 million would be a 50% drop for the GTA. It’s not going to happen my friend. If you think it is, you are delusional. Second, I saw my home drop in value from 1990 to 1998 and couldn’t have cared less. It was paid for, I had a place to live and more equity outside my home than in it. Similarly today, I couldn’t care less if there is a drop in the market. Not everyone in Toronto is leveraged to the hilt and have all their equity in a home. That is my message my friend.

#162 Mike in Edm on 05.09.18 at 10:30 am

#15 Lisa T on 05.08.18 at 5:39 pm
I thought the war with Alberta was because of the pipeline not second house tax? What did I miss.
****************************************
One of the taxes BC recently imposed (non-resident tax) has (or will have) big implications on all of us Albertan’s that actually want to spend time at a nice lake in the summer rather than the disgusting sloughs here. Drive around Invermere, Radium, Lake Windermere in the summer…. 90% Alberta license plates.

#163 IHCTD9 on 05.09.18 at 10:32 am

#21 Damifino on 05.08.18 at 5:55 pm
…learn a lot more about tax avoidance, get a fat liquid portfolio and go live quietly among the masses.
————————–

Done, done and done. Eight years ago, when the writing was on the wall. Much happier now.
_______________________________________

Excellent. I’m a little later to the front, but I’m collecting ordinance faster every year.

Like I’ve said a hundred times: Canadians are the problem, we got stupid somewhere along the line. No change until we smarten up. It’ll be a while.

Nothing’s going to change no matter the hand that is on the tiller. “live quietly among the masses” is (unfortunately) some great advice. Looks like communism is on its way – don’t tip your hand if you’ve got something to lose.

I’m going all the way on every front with avoiding taxes, and I’m going to win this game big. I’m not down for getting fleeced due to the stupidity of my fellow countrypeople. They can pay up, I’ll be passing.

#164 robert james on 05.09.18 at 10:33 am

It appears the luxury house market in the `Couver hit the skids… http://calgaryherald.com/real-estate/vancouver-luxury-property-is-continents-worst-performer/wcm/33c8fddb-90f0-49d4-a788-2c61be843d6b

#165 jess on 05.09.18 at 10:38 am

riddle wrapped in a mystery inside an enigma

“In total, Blavatnik, Intrater, Shustorovich and Kukes made $10.4 million in political contributions from the start of the 2015-16 election cycle through September 2017, and 99 percent of their contributions went to Republicans. With the exception of Shustorovich, the common denominator that connects the men is their association with Vekselberg.”

Ukraine-born billionaire Len Blavatnik.
McConnell surely knew as a participant in high level intelligence briefings in 2016 that our electoral process was under attack by the Russians. Two weeks after the Department of Homeland Security and the Office of the Director of National Intelligence issued a joint statement in October 2016 that the Russian government had directed the effort to interfere in our electoral process, McConnell’s PAC accepted a $1 million donation from Blavatnik’s AI-Altep Holdings. The PAC took another $1 million from Blavatnik’s AI-Altep Holdings on March 30, 2017, just 10 days after former FBI Director James Comey publicly testified before the House Intelligence Committee about Russia’s interference in the election.

https://www.dallasnews.com/opinion/commentary/2018/05/08/putins-proxies-helped-funnel-millions-gop-campaigns

http://www.msnbc.com/the-last-word/watch/avenatti-suspicious-payments-to-trump-lawyer-1228798531802

#166 Conn Smythe on 05.09.18 at 10:38 am

In response to #127 Steve French, the bearded mystic sage who runs this blog states,

“None of which I said. But feel free to embarrass yourself. – Garth”

An award should be given to you captain Garth for your witty ripostes! Pure genius and Churchillian in their caliber!

#167 Conn Smythe on 05.09.18 at 10:47 am

#143 crowdedelevatorfartz

“Ummm , I hate to disagree but most of the teachers I have met are in it for the garanteed money($75k/year starting out?), the job security that unionization bring and , oh yes, almost forgot, that excellent garanteed pension $$$$$”

Sadly you are correct for the majority of teachers and I know this first hand better than most….

#168 IHCTD9 on 05.09.18 at 10:52 am

#159 Conn Smythe on 05.09.18 at 10:21 am
#157 IHCTD9

“If you could have got 2 million for your house last year – but today you can only get 1 million for it – you’ve lost 1 million in tasty gains no matter when you bought or how much you paid.

How’s that for some perspective?”

First, a drop in 1 million would be a 50% drop for the GTA. It’s not going to happen my friend. If you think it is, you are delusional. Second, I saw my home drop in value from 1990 to 1998 and couldn’t have cared less. It was paid for, I had a place to live and more equity outside my home than in it. Similarly today, I couldn’t care less if there is a drop in the market. Not everyone in Toronto is leveraged to the hilt and have all their equity in a home. That is my message my friend.
____

None of your post is relevant to the point being made to Ed.

Just to review – my point (to Ed) is that lost equity is lost equity – even if you are still millions in the black, no matter what you paid, and no matter when you bought.

I made no estimate on future GTA RE values, how many might be leveraged out the whazoo, or who might give a crap about any of it.

#169 Otherwayaround on 05.09.18 at 11:01 am

#39 Niagara Region

Excellent post.

So many misconceptions/lies out there that fuel the hate. Dig deeper and then when you think you hit some truth, question it.

#170 Thanks Flop on 05.09.18 at 11:12 am

To For Those About to Flop. Really appreciate your posts they are generally the best part of this comment section. Very valuable. Thank you.

#171 IHCTD9 on 05.09.18 at 11:12 am

#150 PastThePeak on 05.09.18 at 9:27 am

How many people do you know who buy and move every couple of years, for the purpose of increasing their wealth? This is principal residences, remember. You have to live there for a year to quality. Every time they sell/move, they pay 4-5% commission, land transfer tax, moving costs, etc.

So to speculate on housing and (legally) not pay cap gains, you need to “keep on moving”. A single person might, but can’t see anyone with a family doing it. I personally know of no one who does this, outside of a few contractors who build their own homes, live there for a few years (like 3-4 min), and then repeat. It is in the build part where they make/save the most money (doing more themselves). But this is rural and low numbers.

And Garth can correct me if I am wrong, but I am sure it is within the CRA’s ability to assess such an activity as a business type activity (how are you earning most of your money), and re-assess taxes owing accordingly.

As others have pointed out to you and the “tax ’em” crowd, if capital gains are to apply to sale of principal residences, then so should the decidability of costs of purchase, sale and carrying also apply (mortgage interest deductible every year, property taxes, commissions deductible, legal fees, etc).

AND, for a long held asset like a house, the cost of inflation should also be taken into account, so if one purchased a house and lived in it for 30 years, then the inflation rate should be used to determine the adjusted cost base at sale time.

Take into account all of that, and very little capital gains would be realized anyways, though at a much higher cost and complexity of the tax system.

…but these points won’t change any or the “tax ’em” crowds opinions anyways…
_______

I know quite a few myself. They all build, live in, and sell for tax free gains. Most are trying to nuke the mortgage and quit after they do so as living like this sucks. I know one couple (with kids) who moved 13 times!

I don’t think the CRA gives a prescribed time where after you can sell tax free. I think if the CRA wanted to, they could swoop down at any time and see you’ve moved 5 times in 10 years and that you work in construction and call it business activity. For whatever reason, they are not doing it.

I totally agree that if PR’s are taxed on CG’s, then all costs like mortgage interest, CMHC fees (and tax), maintenance, property taxes, upgrades, additions, renos, everything that is part of the cost, and that contributes to increasing it’s value should be tax deductible.

When you consider the mortgage interest alone is usually same or more than principal value paid, I wonder how much the gov would gain after they hired the 100K new fat cats at the CRA to sort through all these deductions to make sure no one is “cheating”…

This is one reason why the principal residence exemption now needs to be documented and verified via the personal tax return. The days of buying-renovating-moving and claiming a tax-free gain are over. – Garth

#172 jess on 05.09.18 at 11:18 am

Many Americans think of the 1980s and 1990s as the period when manufacturing went away, but in fact three times as many manufacturing jobs were lost in 2000–17. Erik Hurst of the University of Chicago and his colleagues presented research at the NBER’s 33rd Annual Conference on Macroeconomics showing that this occurred even as the productivity in the manufacturing sector increased. A prime reason, they found, was replacement of workers with machines, particularly in areas most exposed to trade with China.

The Transformation of Manufacturing
and the Decline in U.S. Employment
Kerwin Kofi Charles, University of Chicago and NBER, Erik Hurst, University of Chicago and NBER, and Mariel Schwartz, University of Chicago

http://www.nber.org/macroannualconference2018/macroannual2018.html

#173 IHCTD9 on 05.09.18 at 11:25 am

#151 Clint on 05.09.18 at 9:30 am

But freedom to win also means freedom to fail. If you fail doing stupid then you can whine all you want, but don’t expect me to pay for your stupid
______

Sorry, this is Canada; where anyone still in the black is responsible for bailing out the douches.

#174 Stan Brooks on 05.09.18 at 11:32 am


#126 Howard on 05.09.18 at 4:36 am
Immigration should be reduced to put upward pressure on wages until the average Canadian wage approaches the average American wage. Even then it still wouldn’t be equal given Canada’s higher cost of living.

The median Canadian household income is $76,000. The median US household income is $56,500 ($70,600 Cdn). Maybe we need more foreign-educated citizens who can Google. – Garth

=====================

That is before taxes.

When accounting for taxes we have less left.

Plus the purchasing power is much worse here,
With 100 k USD you will be rich in Texas, hardly make a living anywhere in GTA.

Tax stupidity, do not underestimate it

Now add in US healthcare costs and, of course, ammo. – Garth

#175 Conn Smythe on 05.09.18 at 11:39 am

#166 IHCTD9 on 05.09.18 at 10:52 am

“Just to review – my point (to Ed) is that lost equity is lost equity – even if you are still millions in the black, no matter what you paid, and no matter when you bought.”

Yes lost equity is lost equity, that is obvious. My point is that I and many others I am sure couldn’t care less. You don’t just dump a home that has and does give you great comfort and enjoyment because it went down in value recently. That is a speculator mentality and it might be applicable to house flippers but not to long term owners who have more equity outside their principal residence than the residence itself. To repeat I saw my home decline for a decade in the 90s and couldn’t have cared less.

#176 Dissident on 05.09.18 at 11:46 am

@Spillover – I’m gonna chime in with another ‘nailed it’.

Part of the reason why people jumped on buying and flipping houses as their ‘primary residence’ (cough BS! cough) when interest rates were so low was because they could flip assets for tax-free dollahs at such a speedy, short-term rate. After the 2008 stock market crash, people were wary of the stock market (which they shouldn’t have been, cause if they bought in when there was blood in the streets, they woulda made a killing, unless of course, they lost everything from it) – or – they did well from the stock market crash and soon after plopped all their dough on a quickly-appreciating house and flipped it or became landlords. So many variations of this story, and more than one contributing factor at play. But bottom line is that it was seen as fast, dumb cash without the volatility risk of stock markets, and no taxes…

#177 Fake News Again on 05.09.18 at 11:53 am

Howard on 05.09.18 at 4:36 am
Immigration should be reduced to put upward pressure on wages until the average Canadian wage approaches the average American wage. Even then it still wouldn’t be equal given Canada’s higher cost of living.

The median Canadian household income is $76,000. The median US household income is $56,500 ($70,600 Cdn). Maybe we need more foreign-educated citizens who can Google. – Garth

______

Correct. I think what the OP might have been trying to say is the “general cost of living” in the USA is much cheaper than Canada even though they have only a couple of grand difference in average household income.

Food, rent, gas, booze all much cheaper.

He said what he said. It was wrong. – Garth

#178 Pre-retiree on 05.09.18 at 11:55 am

Subprime borrowing in Canada is for real.

https://www.bnnbloomberg.ca/for-canada-s-3-4-million-subprime-borrowers-higher-rates-could-spell-disaster-1.1073965#_gus&_gucid=&_gup=twitter&_gsc=0AH67FS

#179 Fake News Again on 05.09.18 at 12:00 pm

Conn Smythe on 05.09.18 at 10:47 am
#143 crowdedelevatorfartz

“Ummm , I hate to disagree but most of the teachers I have met are in it for the garanteed money($75k/year starting out?), the job security that unionization bring and , oh yes, almost forgot, that excellent garanteed pension $$$$$”

Sadly you are correct for the majority of teachers and I know this first hand better than most….

______

Absolutely true. The school we have our kids at is falling apart. They are ‘raising money” all the time. But yet when you include the “Gold Plated Pension” all the teachers there make over 100K.

It has not been “about the kids” for a long long time.

#180 Newcomer on 05.09.18 at 12:04 pm

#108 Fake News Again on 05.08.18 at 11:47 pm

And Govt Workers wonder why the public is so pissed off…..
——–

It’s a free country and teaching posts are open to all comers (with no criminal record). If teaching posts are so incredibly compensated, why don’t you get one? You could apply some gumption and make the most of what the free market has to offer. But you don’t. Because teaching largely sucks. #39 Niagara Region has it right. It’s a very hard row to hoe, and these days most academics end up poor, if they are even able to stay in the game. Believe me, the people in charge of the purse strings are doing everything they can to pay them less, but the market will not bear it. As it is, it is next to impossible to retain good talent in the schools and universities. What would you do? Do you want to try paying less? In a free market, that buys you the dregs. Get with the capitalist program and support putting resources where you want results.

#181 Al Bundy on 05.09.18 at 12:05 pm

I have nothing in particular to say, just thought I’d let you know you’re spot on, as usual.

I’ve got a nephew who calls himself a Communist, reads Marx and Mao (wtf) and talks about guaranteed income all the time, which basically means he does nothing all day and his wife pays the bills. I’m pretty sure he’s what you’re talking about when you talk about the mob.

Meanwhile, I’ve assumed all my life that I probably shouldn’t expect society to look after me, so I’d better make myself useful and do it myself. So I’ve lived below my means and built up some investments, just enough to fool myself into thinking I have some freedom. I’m also a software developer, which is not a great gig for an aging gen-Xer. I like to think I’m pretty good at it, but I’m not a businessman, and to people who might want to hire me, it seems I’m somewhere between being the problem and being irrelevant, so I’ve been thinking lately I’m mostly unemployable, and I’d better figure out how to get by as a Walmart greeter. Pretty sure I’m not qualified.

I’d be a lot better off in Ontario, but the people I love are in the west, so here I am, and I’ve mostly thrown my vote away voting Liberal because you’re the only Conservative I’ve ever heard of who’s actually conservative. But the longer I have to look at JT and his merry band of smug university administrators on the news, the harder it gets not to realize I’m caught between the rock of Conservatives who aren’t and the hard place of Liberals who want to pry out my fillings. I guess it’s a democracy, though, and the best we can do is throw one set of entitled ass-hats out of office and install another, so next time around, for the first time in my life, I’ll very likely be taking your implied voting advice.

Is it wrong to hope Alberta invades and enslaves BC? Depressing.

#182 Gravy Train on 05.09.18 at 12:12 pm

The political answer to demands from the deplorables for ‘equality’ is to nibble away at the savings, investments and assets of those who earned or built them. — Garth

Is there not an inverse relation between education and deplorability, Garth? The less education people get, the more deplorable they become. A case in point is Smokey. So, everyone, be nice to our educators; they’re our first line of defence. :)

“I love the poorly educated.” — Donald Trump

And the public approval rate for [Hoovering capital and savings] is hovering around 90%. — Garth

Clever. Your use of not just alliteration but agnomination. You must be an English major. I won’t tell Smokey! :)

#183 Lobster Man on 05.09.18 at 12:34 pm

Gains for principal residence in Canada are tax-free. Fair enough. But why not provide a level-playing field, and give the same incentives to developers/landlords for purposely-built rental properties. This would make these two modes of housing the same as prior to 1971 (when capital gains tax was first introduced in Canada).
Purposely-rentals will flourish and rental costs should ease.
Hello Ottawa, are you listening?

#184 IHCTD9 on 05.09.18 at 12:37 pm

I was listening to a couple interviews with Guy McPherson the other night. Mr. Guy is a retired Biology Prof from U of Arizona. He essentially says rapid climate change will lead to a quickly escalating crisis in growing staple foods like grain, corn and rice. This in turn will lead to the extinction of the human race within 10 years. As in, all humans dead by 2028.

While I’m not buying that theory, he did have something interesting to say.

He was asked what we humans can do to prepare? He said there is no we, and the time was too late to be proactive. The idea that the masses could come together with a consensus for the greater good of all life on the planet was inconceivable right from the get go. He likened it to idealism and it was a waste of time pretending it could ever happen without a major crisis.

He said all we can do to prepare is what the individual is able to do. Individual expenditures of energy and brainpower can save families and small groups of folks. Individual efforts can make a difference – waiting for authority and big government to swoop down and save the day for all is living in la-la land. He said the vast majority would be dead in a matter of weeks (those who sat around and waited for others to provide them the solutions they needed to survive).

That’s exactly how I feel when it comes to the taxpayer. You have little to no say what the government decrees on the tax/fee front. All you can do is prepare to receive the worst, and avoid the salvo as best you can – on an individual basis. You’re not going to vote yourself a tax break, or good stewardship in government. The road to destruction is paved with good intentions. Government usually achieves the opposite of what it sets out to do. Most Canadians appear to be not very smart.

Mr. Guy has a pretty extreme theory to push, but he’s got it right on the back end. YOU are the master of your own fate in just about any situation you can name.

#185 IHCTD9 on 05.09.18 at 12:39 pm

#181 Lobster Man on 05.09.18 at 12:34 pm
Gains for principal residence in Canada are tax-free. Fair enough. But why not provide a level-playing field, and give the same incentives to developers/landlords for purposely-built rental properties. This would make these two modes of housing the same as prior to 1971 (when capital gains tax was first introduced in Canada).
Purposely-rentals will flourish and rental costs should ease.
Hello Ottawa, are you listening?
_____

But, but , but… those landlords will end up getting rich!

That’s TABOO!

#186 Jamie Dimon on 05.09.18 at 12:41 pm

How do millennials not realize these “greedy boomers” are our parents?? Ya want to own a house so frickin bad who cares if dad, grandpa, and uncle all get skewered in the process? Just hang tight I’m sure they’ll all be dead soon enough and then you can claim what is rightfully yours and finally have validation as a human being. In the meantime, start with less pipeline protests and more votes for conservative policies.

#187 Lee on 05.09.18 at 12:55 pm

I don’t think the CRA is taxing people on gains if they buy, move in, renovate and move, at least not unless they do it more than once in a short period of time. They also do not appear to be taxing people on complete tear-down re-builds unless you never move in. I suspect though it won’t be long before they start to tax the latter scenario if someone moves in and lives there less a few year.

#188 maxx on 05.09.18 at 12:56 pm

“If you like this stuff, you know how to vote.”

Don’t like it, but the world needs to seriously focus on the unsustainable civil erosion caused by relentless and obscene, pathological wealth inequity.

“If you don’t, learn a lot more about tax avoidance, get a fat liquid portfolio and go live quietly among the masses.”

Did and the “masses” are not happy. Heaven forbid we collectively even begin thinking, however clumsily, about leveling the playing field to maintain what’s left of a generally very peaceful and considerate society.

If this chasm continues to widen, we will increasingly feel less safe.

Otherwise, perhaps we ought to welcome in the Wild, Wild, West, part deux.

#189 Lobster Man on 05.09.18 at 1:00 pm

#183 IHCTD9,

You have to hit that “Supply Button”. Since the 1970’s there has been a great reduction on purposely-built rental buildings. Who wants to be in that game? The estate tax will bankrupt your heirs…..

LM

#190 Smoking Man on 05.09.18 at 1:03 pm

#180 Gravy Train on 05.09.18 at 12:12 pm
The political answer to demands from the deplorable for ‘equality’ is to nibble away at the savings, investments and assets of those who earned or built them. — Garth

Is there not an inverse relationship between education and deplorability, Garth? The fewer education people get, the more deplorable they become. A case in point is Smokey. So, everyone, be nice to our educators; they’re our first line of defence. :)

“I love the poorly educated.” — Donald Trump

And the public approval rate for [Hoovering capital and savings] is hovering around 90%. — Garth

Clever. Your use of not just alliteration but agnomination. You must be an English major. I won’t tell Smokey! :)
…..

Love arrogance of the schooled. Ohhh big word “agnomination” like my phone can’t find the meaning in two seconds.

When you learn to wheel 400 to 1 margin so you never need to work again, come talk to me about education grasshopper.

#191 bdwy sktrn on 05.09.18 at 1:07 pm

Maybe we need more foreign-educated citizens who can Google. – Garth

————-
an exquisite burn !

ps: from a guy (engineer) who won’t use caps , to a master wordsmith …um, maybe google as a verb needs no capitalization.
and, yes, i googled it:)
————–
btw summer is in full swing in yvr . got a sunburn on the weekend. van is worth the premium , that’s why the world will ‘B.ring C.ash” for decades to come.

re the 2.3m kits duplex – ‘grungy’ comm drive duplex ask 2M, granted it is very roomy, makes that kits place an absolute bargain.

https://www.realtor.ca/Residential/Single-Family/19350585/2190-GRAVELEY-STREET-Vancouver-British-Columbia-V5L3B9
—————-
prices holding pretty rock solid in this part of east van, slow market but no bloom of supply yet.

———————
o/t … eagerly waiting for smokey’s 2cents on the fed ndp’s booting of the latest ‘sexual’ offender

#192 Ian on 05.09.18 at 1:17 pm

#155 Dominoes

I have not, but that sure is interesting. And concerning. I’ll pay more attention this weekend as I’m out and about.

#193 IHCTD9 on 05.09.18 at 1:18 pm

#175 Fake News Again on 05.09.18 at 11:53 am

Food, rent, gas, booze all much cheaper.
__________________________

Not too long ago, one US gallon of milk in small town Alabama was selling for .99 cents. Minimum wage in Alabama is around 7.00 hr.

That’s winning huge.

A guy making minimum wage in Ontario would need to work 2.2 hrs to buy the same amount of milk as the guy in Alabama could in 1 hr of work.

In some states, cutting the costs of goods, services, taxes, government, and energy clean in half is only just the START of how much you’ll save compared to say, living in Ontario.

#194 Ian on 05.09.18 at 1:21 pm

OK so the US 10 year note auction has ended, median yield came in at 2.95%. It’s edging back up folks. Spent a large part of the day, especially right before the noncompetitive auction, above 3%. I think we’re pretty close to leaving 3% in the rearview as yields go higher.

https://www.treasurydirect.gov/instit/annceresult/press/preanre/2018/R_20180509_1.pdf

#195 Iconoclast on 05.09.18 at 1:23 pm

Why an asset tax? Because that’s where the money is.

The root cause is government’s insatiable demand for money.

MORE MONEY. MORE MORE MORE MONEY.

It never shrinks, it only grows.

Liberals, PCs, NDP, it only grows.

#196 Doug in London on 05.09.18 at 1:30 pm

No need to worry. Doug Ford, if and most likely when he becomes the next premier will fix everything wrong in Ontario.

#197 Myra Andrews on 05.09.18 at 1:34 pm

CJBob #145

I am not in the market to buy anything. Just thought it was interesting that now that the market is slowing Zolo has stopped showing any price drop in the listing. They used to. Gotta wonder why they stopped doing that.

#198 april on 05.09.18 at 1:54 pm

As I turned on CBC radio early this morning I heard someone from the BMO? talking about some of the Vancouver housing problems associated with people unable to find affordable accommodation saying, ” a Vancouver real estate collapse might be good as it would encourage small businesses to move in”. Bring it on!!

#199 Waiverless on 05.09.18 at 2:20 pm

#107 For those about to flop…

Sold for 1.1
Dunno Waiverless and LS in Arbutus are better at this than me ,I just do rough and ready and say 45k loss.
I guess no trip to Ireland for these guys after all…

——————————————————–

If it was rented for 2500 (which I consider generous for that place) it’s a 65k Loss. That has got to hurt. Even if they moved in and paid down the mortgage they’re looking at roughly 33k in losses. They better not hope it was vacant – 136k loss in that case.

#200 JohnnyBoy on 05.09.18 at 2:24 pm

President Trump said Thursday that “everyone thinks” he deserves the Nobel Peace Prize, after weeks of suggestions that he should be honored for his diplomatic efforts on the Korean Peninsula.
“Everyone thinks so, but I would never say it,” Trump said when asked by a reporter in the White House if he thinks he should win the prestigious award.
I have one question……. WHO THE F#@k IS EVERYONE?
What a pompous piece of dog feces he is.

#201 PRR S1 Class 6-4-4-6 on 05.09.18 at 2:27 pm

‘…demands from the deplorables for ‘equality’ is…’

It’s millennials who demand equality and inclusiveness, considering both more important than freedom of speech. Typical lefty stuff. Deplorables, on the other hand, voted for Donald Trump and generally support him and his policies, which I guess makes ME a deplorable as I do support Mr. Trump. Long ago I realised that ‘equality’ is largely a mirage, as nature makes everyone different and, in many cases, not even remotely equal. That’s why people like me say that life isn’t fair. But millennials know better!

#202 JohnnyBoy on 05.09.18 at 2:31 pm

#188 Smoking Man on 05.09.18 at 1:03 pm

#180 Gravy Train on 05.09.18 at 12:12 pm
The political answer to demands from the deplorable for ‘equality’ is to nibble away at the savings, investments and assets of those who earned or built them. — Garth

Is there not an inverse relationship between education and deplorability, Garth? The fewer education people get, the more deplorable they become. A case in point is Smokey. So, everyone, be nice to our educators; they’re our first line of defence. :)

“I love the poorly educated.” — Donald Trump

And the public approval rate for [Hoovering capital and savings] is hovering around 90%. — Garth

Clever. Your use of not just alliteration but agnomination. You must be an English major. I won’t tell Smokey! :)
……………………..

Love arrogance of the schooled. Ohhh big word
“agnomination” like my phone can’t find the meaning in two seconds.

When you learn to wheel 400 to 1 margin so you never need to work again, come talk to me about education grasshopper.
………………………………………………………………….
Actually nobody gives a crap about you Uneducated Uncouth Smoking Dick, hows your best buddy Trump doing? Are you gas prices high enough out in Cali? We know we get hosed here but your not that far behind us.
https://www.gasbuddy.com/GasPrices/California/Newport%20Beach

#203 Ubul on 05.09.18 at 2:31 pm

This is one reason why the principal residence exemption now needs to be documented and verified via the personal tax return. The days of buying-renovating-moving and claiming a tax-free gain are over. – Garth

How about taxing profit on ETFs at higher rate, based on the proven fact, that index investment involves less risk than investing in individual stocks, for example?

It is easy to come up with stupid ideas on how to tax people more and declare that the days of… are over.

When renovation is a business, it should be taxed as such. Seems fair. – Garth

#204 Alistair McLaughlin on 05.09.18 at 2:33 pm

@#2 Spillover, the principle residence exemption should stay because if they start taxing capital gains on principle residences, they’ll need to allow mortgage interest to be deducted from taxable income. You can’t tax something as a capital gain, yet not allow interest deductions. That’s not how capital taxes work in Canada (or anywhere else). So, the net gain to the government for taxing home appreciation? ZERO. Net effect on property appreciation? Likely also zero. Less incentive to pursue capital appreciation, but more incentive to borrow money and buy houses with deductible interest. So why would they ever bother? They won’t.

#205 OlderMillenial on 05.09.18 at 2:39 pm

The taxes that are being collected right now are being used to pay for the healthcare and benefits baby boomers were reaping throughout their lives.

I don’t think you have a right to complain about high taxes, especially not now that we’ve seen how your generation squandered it, you still got another 10-20 years of This, we still got another 60. Nice goodbye gift for the next generation fellas.

The taxes now collected do not even cover current spending, and the new debt is piling up fast. Good luck with that, kids! – Garth

#206 Shawn Allen on 05.09.18 at 2:39 pm

Estate Taxes are Only for the Little People?

Lobster Man at 187 complained that estate taxes on apartment buildings would bankrupt your heirs.

********************************************
True, the heirs might have a very hard time holding onto all the buildings. They might have to sell some to pay the taxes or borrow cash to do so.

Meanwhile in 40 years of reading the financial pages I can’t recall a single case of a big mega rich Canadian family in the news about a big tax bill when the corporation and mega wealth was passed on to heirs.

Going way back K.C. Irving? Nope, something about him living in Bermuda for tax purposes after making all his money in Canada.

Canadian Tire heirs? Don’t think so.

Power Financial Desmeir family on the recent death of Paul Desmeir? Nope.

Richardson family in Winnipeg? Big spread about succession planning in a magazine a while back. Not a word on any worry about estate taxes.

Thomson Family (on death of Ken Thomson – Barron Thomson of Fleet – some years ago) Nope.

There must be a dozen or more big rich prominent families where mega assets have passed onto the next generation and I just don’t recall any news about them having to sell assets or even borrow money to pay estate taxes. Not even any complaints about paying such with cash if they had it.

I suspect estate taxes are only for the littler people. Families with really expensive cottages or some apartment buildings. Now, those people gotta pay! But the mega rich deserve to keep all their assets and defer capital gains even upon death, right?

#207 Smoking Man on 05.09.18 at 2:59 pm

JohnnyBoy on 05.09.18 at 2:31 pm
#188 Smoking Man on 05.09.18 at 1:03 pm

#180 Gravy Train on 05.09.18 at 12:12 pm
The political answer to demands from the deplorable for ‘equality’ is to nibble away at the savings, investments and assets of those who earned or built them. — Garth

Is there not an inverse relationship between education and deplorability, Garth? The fewer education people get, the more deplorable they become. A case in point is Smokey. So, everyone, be nice to our educators; they’re our first line of defence. :)

“I love the poorly educated.” — Donald Trump

And the public approval rate for [Hoovering capital and savings] is hovering around 90%. — Garth

Clever. Your use of not just alliteration but agnomination. You must be an English major. I won’t tell Smokey! :)
……………………..

Love arrogance of the schooled. Ohhh big word
“agnomination” like my phone can’t find the meaning in two seconds.

When you learn to wheel 400 to 1 margin so you never need to work again, come talk to me about education grasshopper.
………………………………………………………………….
Actually nobody gives a crap about you Uneducated Uncouth Smoking Dick, hows your best buddy Trump doing? Are you gas prices high enough out in Cali? We know we get hosed here but your not that far behind us.
……..
Haha, beg to differ, over 2000 copies of my book sold, 5 star reviews all over amazon. Zero promotion apart from one day that Garth allowed a link.

Do you really think I give a shit or even care to know what it cost to fill up a gas tank.

Do you want to see a pic of my new 80ft seeray?

#208 Alistair McLaughlin on 05.09.18 at 3:03 pm

@89 Erin, everyone understands how marginal taxes work. Do you really think you’re making a point? Taking 53% of marginal income over $230K isn’t peanuts. It’s a helluvalot of money. Every additional dollar of income above the threshold leaves you with only 47 cents – less than half. And it’s not like the taxes on the amounts beneath the top threshold are being taxed at low rates. As soon as you reach $93,208 (in Ontario), you’re paying 43.41% on each additional dollar earned. And it only goes up from there. This is considered “fair” by people like you who feel the need to lecture us on simple tax concepts most of us grasped in high school.

#209 Fake News Again on 05.09.18 at 3:04 pm

Newcomer on 05.09.18 at 12:04 pm
#108 Fake News Again on 05.08.18 at 11:47 pm

And Govt Workers wonder why the public is so pissed off…..
——–

It’s a free country and teaching posts are open to all comers (with no criminal record). If teaching posts are so incredibly compensated, why don’t you get one? You could apply some gumption and make the most of what the free market has to offer. But you don’t. Because teaching largely sucks. #39 Niagara Region has it right. It’s a very hard row to hoe, and these days most academics end up poor, if they are even able to stay in the game. Believe me, the people in charge of the purse strings are doing everything they can to pay them less, but the market will not bear it. As it is, it is next to impossible to retain good talent in the schools and universities. What would you do? Do you want to try paying less? In a free market, that buys you the dregs. Get with the capitalist program and support putting resources where you want results.

______

Easy answer. I’m not a hypocrite.

#210 Chris on 05.09.18 at 3:06 pm

#2 Spillover on 05.08.18 at 5:08 pm

Give me one reason why the principle residence exemption should stay?
___________________________________

As long as annual inflation plus any investment into the home is permitted to be deducted from those capital gains, then sure. Whatever.

#211 Stan Brooks on 05.09.18 at 3:17 pm


Now add in US healthcare costs and, of course, ammo. – Garth

On the health care:

You can’t compare apples and oranges.

1. You can’t find equivalent sh..ty coverage with lack of access to specialists or long waiting times anywhere in US.

2. the ‘free health care’ in Canada does not cover dental at all nor some ‘sophisticated’ procedures like hip replacement.

I have been in US paying for their services due to the inferiority of the Canadian system and pure inability to access the system in a practical way.

I would say our ‘health’ care is probably up to 40 % of the value of the US health insurance, so reduce their health care cost by 60 % to get our quality when comparing.

#212 Stan Brooks on 05.09.18 at 3:22 pm

Now add in US healthcare costs and, of course, ammo. – Garth.

The kid of a friend of mine almost died recently with doctors unable to diagnose very basic condition establishing in very confident tone a wrong diagnosis and refusing to allow (god forbid ask) for a second opinion.

I told him to insist on investigation and potentially sue the doctor and the hospital but being the Canadian he is I know he will do nothing that could potentially save other people lives and punish the incompetent.

#213 Lobster Man on 05.09.18 at 3:23 pm

#204 Shawn Allen

You are correct, Shawn. It is the “little-people” landlord that would get hit.

Here is a link with more details than what I wrote earlier:

https://thetyee.ca/Opinion/2017/07/06/Tax-Changes-More-Rental-Housing/

“…..In arguing for tax equity for rentals and tenants it is important to note that, Ottawa dramatically favours homeowners over tenants in tax policy because owners are exempt from capital gains taxes, people can often buy a condominium and make payments $200 lower than rent for a similar unit. At the end of 25 years, the tenant has paid shelter costs of $60,000 more than the condo-owner, who by then has paid off the mortgage, lives rent-free, and has a large tax-free capital gain when the condo is sold. Is this fair?….”

So due to Ottawa’s tax policies the would-be “little-people” landlord would rather put his money into more “principal residences” (lived in temporarily by cousins, nephews ……and the likes), and buying and selling them every year or two to claim the tax-free gains.

#214 JohnnyBoy on 05.09.18 at 3:55 pm

#191 IHCTD9 on 05.09.18 at 1:18 pm

#175 Fake News Again on 05.09.18 at 11:53 am

Food, rent, gas, booze all much cheaper.
__________________________

Not too long ago, one US gallon of milk in small town Alabama was selling for .99 cents. Minimum wage in Alabama is around 7.00 hr.

That’s winning huge.

A guy making minimum wage in Ontario would need to work 2.2 hrs to buy the same amount of milk as the guy in Alabama could in 1 hr of work.

In some states, cutting the costs of goods, services, taxes, government, and energy clean in half is only just the START of how much you’ll save compared to say, living in Ontario
…………………………………………….
Doug Ford has a plan and Wynne is not part of it!

#215 PastThePeak on 05.09.18 at 4:00 pm

#206 Alistair McLaughlin on 05.09.18 at 3:03 pm
@89 Erin, everyone understands how marginal taxes work. Do you really think you’re making a point? Taking 53% of marginal income over $230K isn’t peanuts. It’s a helluvalot of money. Every additional dollar of income above the threshold leaves you with only 47 cents – less than half. And it’s not like the taxes on the amounts beneath the top threshold are being taxed at low rates. As soon as you reach $93,208 (in Ontario), you’re paying 43.41% on each additional dollar earned. And it only goes up from there. This is considered “fair” by people like you who feel the need to lecture us on simple tax concepts most of us grasped in high school.
++++++++++++++++++++++++++++++

Amen…

#216 JohnnyBoy on 05.09.18 at 4:08 pm

#205 Smoking Man on 05.09.18 at 2:59 pm

JohnnyBoy on 05.09.18 at 2:31 pm
#188 Smoking Man on 05.09.18 at 1:03 pm

#180 Gravy Train on 05.09.18 at 12:12 pm
The political answer to demands from the deplorable for ‘equality’ is to nibble away at the savings, investments and assets of those who earned or built them. — Garth

Is there not an inverse relationship between education and deplorability, Garth? The fewer education people get, the more deplorable they become. A case in point is Smokey. So, everyone, be nice to our educators; they’re our first line of defence. :)

“I love the poorly educated.” — Donald Trump

And the public approval rate for [Hoovering capital and savings] is hovering around 90%. — Garth

Clever. Your use of not just alliteration but agnomination. You must be an English major. I won’t tell Smokey! :)
……………………..

Love arrogance of the schooled. Ohhh big word
“agnomination” like my phone can’t find the meaning in two seconds.

When you learn to wheel 400 to 1 margin so you never need to work again, come talk to me about education grasshopper.
………………………………………………………………….
Actually nobody gives a crap about you Uneducated Uncouth Smoking Dick, hows your best buddy Trump doing? Are you gas prices high enough out in Cali? We know we get hosed here but your not that far behind us.
……………………………………..
Haha, beg to differ, over 2000 copies of my book sold, 5 star reviews all over amazon. Zero promotion apart from one day that Garth allowed a link.
Do you really think I give a shit or even care to know what it cost to fill up a gas tank.
Do you want to see a pic of my new 80ft seeray?
……………………………………………………………………..
2000 copies to line any bird cage sure little Smoking turd. Sure go ahead cut and paste yourself into a photo captain bullshitter. I do believe that they are called Sea Ray dummy. I would think if you had one you would actually know how to spell the name of your own boat!

#217 Sonny on 05.09.18 at 4:31 pm

Bank of Canada’s mortgage ‘stress test’ rate climbs higher

Central bank’s rate for deciding if you can afford a mortgage is raised 20 points to 5.34%

http://www.cbc.ca/news/business/bank-canada-mortgage-stress-test-interest-rate-1.4655460

As expected – Sonny

#218 Overheardyou on 05.09.18 at 4:32 pm

#45 Chaddywack on 05.08.18 at 7:17 pm
A more pressing reason for the wealth tax is it’s really the only way to capture taxes from foreign buyers who own houses here or buy ferraris but pay little to no income tax.

—–

Yeah but they pay taxes on the Ferrari, expensive shoes, and mansions they buy. Which support your free health care and getting your roads salted. Think about that.

#219 Gravy Train on 05.09.18 at 4:38 pm

#180 Gravy Train on 05.09.18 at 12:12 pm
“The less [italics added] education people get, the more deplorable they become.”

#188 Smoking Man on 05.09.18 at 1:03 pm
“The fewer [sic] education people get, the more deplorable they become [misattribution].

Smokey, don’t misattribute words to me that I never used. If you change what someone wrote, then use square brackets to indicate the change. I’d prefer that people think that you’re the ignoramus. :)

BTW, I’ve provided you with a link to the proper usage of the words less and fewer. :)
https://www.merriam-webster.com/words-at-play/fewer-vs-less

#220 Lorne on 05.09.18 at 4:52 pm

#177 Fake News Again on 05.09.18 at 12:00 pm
Conn Smythe
#143 crowdedelevatorfartz

“Ummm , I hate to disagree but most of the teachers I have met are in it for the garanteed money($75k/year starting out?), the job security that unionization bring and , oh yes, almost forgot, that excellent garanteed pension $$$$$”

Sadly you are correct for the majority of teachers and I know this first hand better than most….

______

Absolutely true. The school we have our kids at is falling apart. They are ‘raising money” all the time. But yet when you include the “Gold Plated Pension” all the teachers there make over 100K.

It has not been “about the kids” for a long long time.
…….
If it is such a great deal, why don’t you go to university for 5 years and join the crowd?? Of course, you might have to try to actually teach something to 30, 14 year olds!

#221 crowdedelevatorfartz on 05.09.18 at 8:03 pm

@#218 Lorne

Dont shoot the messenger Uncle Lorne.

I think most taxpayers roll their eyes when they hear another Union negotiator for the Teachers say, ‘Its about the kids” when what they really mean is…..

“We’ll use your kids as a negotiating tactic to force the govt to accept our 8 % wage increase the 1st year, our 7% wage increase the second year and our 5% increase the third year.”

Just curious.
What DO you do with all those “professional developement” days every year? Sandwiched in between the 2 months off in the summer, the 2 weeks off at Christmas and the 2 week “Spring Break” all while you suffer through a starting salary of 75k or more.
You poor thing. Misunderstood.
I dont know how you cant stand all that pressure.

#222 Linda on 05.09.18 at 9:16 pm

What is this ‘it’s all about the money’ nonsense? Seriously, how many people working today are NOT out to make every dime they can? Funny how everyone moralizes about how much others make & how those others should be doing their work for less, or be paid less, or make too much etc. So tell me, all you moral marvels, how many of you are not working ‘for the money’? Would you seriously turn down a raise, refuse a benefit or forego a pension you’ve paid into? No? Then why are you expecting someone else to do so?

#223 Gravy Train on 05.10.18 at 6:24 am

#188 Smoking Man on 05.09.18 at 1:03 pm
“Ohhh big word ‘agnomination’ like my phone can’t find the meaning in two seconds.”

Impressive, Smokey! Is that the first time in your life you actually looked up a word in the dictionary? Will wonders never cease? The next thing you know, you’ll be taking classes and courses, and reading books.

Who am I kidding? You’ll always be drunk and deplorable! A boob! :)

“When you learn to wheel [and deal] 400 to 1 margin so you never need to work again, come talk to me about education, grasshopper.”

If I ever do decide to work again, it’ll be for pure enjoyment. I retired five years ago, and, if I’d known how good retirement is, I’d have retired five years earlier! :)

#224 crowdedelevatorfartz on 05.10.18 at 8:06 am

@#220 Linda

So then, its not” all about the kids” ?

Better tell your Union leaders to revise their strike mantra at your next MONTHLY “professional developement day”.

#225 Steven Rowlandson on 05.10.18 at 8:23 am

“In that society, real estate = wealth. You can have $4 million in a liquid portfolio turning out $300,000 in low-taxed income and nobody cares. But move into a $4 million house producing no income, and you’re a social pariah who deserves a tax spanking.”

$4 million house. What a genocidal idea! If this madness isn’t quashed every home owner, real estate investor and real estate agent will want all homes to be that expensive or higher. Naturally the mass of the public will be making due with microscopic pay rates and less than 40 hours a week in many cases….
This is clearly insane and not sustainable.

#226 Linda on 05.11.18 at 4:03 pm

#224 – not a teacher. Just pointing out how people’s expectations that others should forego benefits/pensions/salary increases etc. when they themselves would not & would in fact be deeply outraged/offended if anyone told them they should do it ‘for the kids’ ‘for the environment’ ‘for (fill in reason here)’.

However, since teachers are apparently no longer a desired commodity in today’s society, why don’t we simply enroll all children in online courses via the Internet instead? Of course, that wouldn’t solve the issue of those former teachers having more time off than you think they should. Win some, lose some!