The target

You can hide a million bucks in your RRSP, and escape the long arm of the CRA. You and your squeeze can shelter almost $150,000 as of January in your TFSAs, and Bill Morneau’s sticky singers will never touch. Your investments can earn fat capital gains and the tax bill’s reduced by 50%. Or collect tax-reduced income from dividends. You can even go to cash or (shudder) crypto and bullion to disappear.

But your house? Nah, forget being anon. There’s a target on it.

This pathetic blog has opined of late about how real estate is the next Big Thing for politicians to Hoover. Carbon taxes are hitting homeowners hard. Property taxes are destined to pop – as is the case in Vancouver this week (8% hike). There’s the burgeoning rain tax. Transfer taxes. HST on closing costs and commissions. Crackdowns on speckers, flippers, Airbnbers and suite-renters. And don’t brush off that election-time revelation of Liberal plans for a phase-out of the principal residence capital gains exemption. They’re serious. This is why (as we told you when it started) personal tax returns now collect data on every house purchase and sale.

It’s relentless. And expanding. Canadians over the next few years will be paying for the property lust that propelled valuations higher, created untaxed windfall wealth and birthed an affordability problem that’s splitting generations and widening the divide. As stated, you can hide liquid wealth. You can’t put a bungalow in your pants.

So time for an update.

First to (of course) Vancouver. This was the debut North American city dumb enough to put a tax on houses politicians think should be used more. So second homes not occupied every month, condos used for business purposes, retirees’ winter abodes, occasional-use properties owned by Americans – all are taxed along with units held by evil Chinese satellite families, offshore investors or local speculators. The stated goal is to force under-utilized real estate onto the rental market. But it’s really a tax on wealth. Obviously. The city says it has siphoned off $39 million from sitting duck owners. Meanwhile the vacancy rate has not declined.

The latest? More tax. The empty-house levy will increase by 25% next year and (probably) by half again over the next two years. This is in addition to the provincial ‘speculation tax’ on second properties (another grab at the wealthy, and those damn Albertans who cross the line), plus a new uber property tax on higher-end homes (yeah, the wealthy again).

Toronto is studying the EHT and there’s political pressure to copy. It’s the hot new thing. The kids see it as an ok-Boomer tax. And now the Trudeau feds are about to bring in a national version. Foreign dudes first. Then, without much doubt, the locals.

During that piteous federal election campaign the Libs pledged for the first time to have a national government directly tax  residential real estate. Soon there will be a pan-Canadian vacancy tax – a levy equal to 1% of a property’s value per calendar year on any place owned by a non-resident, even if the property is rented to or occupied by the owner’s family. Expected to suck off $217 million a year, it would apply to all residential properties owned by individuals, corporations or trusts.

It comes atop the massive 15% tax on the acquisition cost of property being bought by any non-resident in the GTA, and the 20% whack charged by BC. Plus foreigners in that province also have to pay 2% annually in spec tax. The message is clear: go home. We don’t want you.

Conclusions: Taxes don’t make houses cheaper. The opposite, actually. The more politicians intervene in the market and the more that’s sucked from the private sector, the more costs increase. If the object here is to chase away non-residents, forcing them to sell to locals, they’ll certainly be looking to recoup their overhead in the process. The only winner is government.

Second, the incursion of the feds into taxing residential real estate usage and ownership – normally the preserve of cities – is a big step. A national vacancy tax on Chinese dudes can easily become one on your ‘luxury’ cottage or cabin. And if politicians have decided nobody can keep a condo void for six months without being taxed more, what about empty nesters and their two vacant bedrooms? Plus, how long do we expect real estate profits to remain completely untaxed? When every other asset producing a capital gain is whacked, why not this one? Hasn’t the exemption for houses been the overarching reason your daughter can’t afford one?

Most Canadian have most of their net worth in one thing. Their homes. Silly geese.

114 comments ↓

#1 not 1st on 11.29.19 at 2:26 pm

Get an RV before the luxury tax kicks in.

This sounds just like the Obama economy, middling GDP and grind the entire thing down with little regulations all over the place. All while spouting useless platitudes. Canadians are in for some lean times. GDP 1.3% this quarter.

Elections do have consequences.

#2 James on 11.29.19 at 2:29 pm

Perhaps we should set a levy for 24 Sussex Drive as that person is definitely not living there. Mr Socks has his family stashed away at behind tall thick trees at Rideau Cottage. Well at least there he can dress up and put on blackface while he prances around the secluded grounds.

#3 Dave on 11.29.19 at 2:37 pm

Lately there is extensive talk about Global Recession…is one around the 2020 corner?

#4 n1tro on 11.29.19 at 2:42 pm

#87 Your buddy on 11.29.19 at 11:38 am

The correct term would be hypocritical conservative. A person who gladly enjoys the income of his wife’s current gov’t job and future pension while bragging about how little income tax he pays. Let suckers pay their share of taxes so your household can benefit seems to be your mantra. If anyone wants to know what you look like, just google hypocrite and your face pops up…
————
Don’t hate the player, hate the game.

#5 islander on 11.29.19 at 2:43 pm

“Vancouver property taxes are 0.24683 per cent of assessed value’ , the lowest in Canada, so yes a rate raise is in order!

https://www.vancourier.com/real-estate/vancouver-named-canadian-city-with-lowest-percentage-property-taxes-infographic-1.23385860

Also, seniors (over 55 years old) can defer property taxes and there is no means test for those who wish to do so.
Let’s not shed too many crocodile tears over property taxes in YVR!

#6 Damifino on 11.29.19 at 2:44 pm

And if politicians have decided nobody can keep a condo void for six months without being taxed more, what about empty nesters and their two vacant bedrooms?
——————————

Now that really is chilling.

Yet, when one takes the concept to its logical conclusion, why should the ‘over housed’ escape punitive taxes?

Thin edge of the wedge, perhaps?

#7 James on 11.29.19 at 2:45 pm

#131 NoName on 11.28.19 at 3:47 pm
#119 James on 11.28.19 at 12:42 pm
Haha James is ether pilot in spare time or rocket scientist full time.
Ang if you are glider pilot we would know you ain’t chicken.
Which one is it?
___________________________________________
Well NoName I don’t glide and I don’t get off on rockets but my in-depth studies include propulsion, aerodynamics, avionics and systems integrations.
Oh I did have IFR but have let it lapse within the last year. You need to have five T/O&L’s every six months, I only had one. Its an expensive hobby. So I surmise I’m a small tasty bird!

#8 ElGatoNerodeYVR on 11.29.19 at 2:57 pm

Ofcourse what our elected politicians conveniently forget is that there is 0 incentive to rent out legally. If you declare the income you will be taxed at the marginal rate so a theoretical 20K a year rental income after 10K tax, 1k year increase in city taxes for having a rental ,1k in utilities makes up for a grand 8k net that has to make out for bad tenants, refresh of the unit a.s.o. Depending on how much the base cost is that makes for a piddly 1% to 2% in net return. Better to just leave it empty and get your average 2.5 % minimum appreciation return accounting for boom / bust cycles. Diversification into RE as 25 -40% of assets is important as a g
Hedge against inflation. Want affordable rentals, exempt the rental income from taxation and let lendords kick out the bad tenants. Predictably the current course of action will catch a few, majority will find a semilegal workaround which will neither generate real revenue nor provide cheaper housing.

#9 Gerti on 11.29.19 at 3:04 pm

I would like to point out something with regards to your comments on the “rain tax” . It is not something new! When homeowners in Austria were started to being taxed on surface water flowing from the roofs of their houses into the storm drains many years ago, my father installed a series of water barrels under every down spout to collect the water which was used during the summer to water the gardens. This saved money on the regular water tax bill. Just saying….

New to us, Gert. Sucks. – Garth

#10 not 1st on 11.29.19 at 3:14 pm

#5 islander on 11.29.19 at 2:43 pm
—-

Oh yeas an increase is in order. How else to pay for those chandeliers for the homeless living under a bridge. Vancouver has officially entered loony land.

https://www.msn.com/en-ca/news/canada/what-weighs-3400-kilos-cost-dollar48-million-and-hangs-from-a-bridge-vancouvers-spectacular-or-tone-deaf-chandelier/ar-BBXvvqg?ocid=spartanntp

#11 45north on 11.29.19 at 3:15 pm

You can hide a million bucks in your RRSP
But your house? Nah, forget being anonymous. There’s a target on it.

in the early days of GIS (geographic information systems ), cities found properties that were not taxed. They are now.

And don’t brush off that election-time revelation of Liberal plans for a phase-out of the principal residence capital gains exemption. They’re serious. This is why (as we told you when it started) personal tax returns now collect data on every house purchase and sale.

their plans are heavily qualified – if this and if that. If the Liberals threatened to remove the principal residence capital gains exemption, across the board, they would lose the Greater Toronto Area. This is an opportunity for the Conservatives.

During that piteous federal election campaign the Libs pledged for the first time to have a national government directly tax residential real estate.

property tax is exclusively, provincial. A national tax on real estate would intrude on provincial jurisdiction. I see endless rounds of federal/ provincial talks. Talks cost a lot of money. The Prime Minister’s Office which would need to be expanded. Probably senior people in each government department – I worked for Agriculture Canada – they’d need extra staff. If you’re a civil servant this is a win.

But looking at the big picture, the new taxes are a net loss for Canada. The City of Vancouver says it has siphoned off $39 million but nobody knows how much money has left Vancouver because of the new taxes. Nobody knows how much money has been diverted away from Vancouver because of the new taxes. Of course over time, it will become apparent, as prices drop. Canada competes with the US for development money – where, the right to own property is in the constitution.

#12 Infrared on 11.29.19 at 3:21 pm

“What about empty nesters and their two vacant bedrooms?”
That sounds like Russia I grew up in: tax on extra sqft, tax on childless couples… :(

#13 Re-Cowtown on 11.29.19 at 3:23 pm

Want a second home in BC? Buy a 45′ motor yacht and park it in a marina. Slip fees are less than property taxes and you can register the boat in Alberta and save the BC transfer tax.

All the fun of living in BC and you don’t have to actually live in BC.

#14 Captain Uppa on 11.29.19 at 3:47 pm

Taxing capital gains on a primary lived-in property will never be taxed. Never.

#15 Sail away on 11.29.19 at 3:58 pm

#13 Re-Cowtown on 11.29.19 at 3:23 pm

Want a second home in BC? Buy a 45′ motor yacht and park it in a marina. Slip fees are less than property taxes and you can register the boat in Alberta and save the BC transfer tax.
All the fun of living in BC and you don’t have to actually live in BC.

———————————-

Worst idea ever.

You must have a 45′ tub you’re trying to flog to some sucker.

Tell you what: You buy the boat and I’ll do long-term Airbnb or VRBO home rentals.

#16 Mean Gene on 11.29.19 at 4:04 pm

In BeeCee there is a home owners grant that everyone receives for their principle residence regardless of income and reduces property tax, unlike the grant in Ontario that is income tested and applies to seniors.

https://www2.gov.bc.ca/gov/content/taxes/property-taxes/annual-property-tax/home-owner-grant

https://www.ontario.ca/page/senior-homeowners-property-tax-grant

#17 GBiddy on 11.29.19 at 4:15 pm

To add to what Garth so aptly said, don’t forget the shared equity mortgages. The feds can be a partial owner, but won’t pay any share of the taxes.

How are any of these recent and proposed assaults on home ownership not simply a modern push to get ppl off the land?

Home ownership has created a middle class. Excessive taxes and valuations will mean concentrated ownership as only corps will be able to own, maintain and pay for lots with houses on them.

What’s next: AirBNB buying up residential real estate to rent it back to the former owners?

Btw, progressive infested little Victoria already has a rain tax.

#18 the ryguy on 11.29.19 at 4:22 pm

Meanwhile in 2019 alone Canada is dolling out over $6 Billion dollars in foreign aid. Government workers make well above average salaries along with generous pensions. Our social benefit liabilities grow every single year. PM sox has no problem just randomly throwing $50 million to whatever Trevor Noahs cause of the day was..additionally at least $20M to the ‘clearly above board’ Clinton Foundation.

Canada does not have a revenue problem..we have an expense problem. All of our problems could be solved by switching the focus to the other side of the ledger.

What accountability is there for the roughly $350 billion dollars the government spends? Almost zero.. It’s a complete joke.

#19 Leftover on 11.29.19 at 4:27 pm

Bring on the tax on capital gains on principal residences, it would trigger more rational allocation of capital, reduce tax evasion, and harmonizes us with the USA.

Definitely not a lefty plot.

#20 Dr Talc on 11.29.19 at 4:29 pm

Inflation is built into the system and thus any increase in property value cannot be called profit, although simpletons may see it as such

#21 earthboundmisfit on 11.29.19 at 4:30 pm

Hah! The CRA has veeeeery long arms when it comes to your RRSP. Just ask anyone in the decumulation phase of their life. 10% withholding tax on the first 5K, 20% up to 15K and 30% beyond 15K. And until you RRIF it, as you must at 71, $25.00 plus HST bank charge every time you make a withdrawal. Coming and going folks, coming and going.

#22 SunShowers on 11.29.19 at 4:35 pm

“The stated goal is to force under-utilized real estate onto the rental market. But it’s really a tax on wealth.”

Sounds like a win-win to me!

Expect these kinds of punitive taxes to continue as long as the private sector insists on underpaying their employees, and expecting direct government transfers like the Canada Child Benefit to make up the difference.

If the private sector doesn’t like it, we could always go back to the days where disgruntled workers show up at their employers’ homes with pitchforks and tire irons.

#23 Sold Out on 11.29.19 at 4:44 pm

#99 Sail away on 11.29.19 at 3:03 pm
#94 Sold Out on 11.29.19 at 1:12 pm
#81 Sail Away on 11.29.19 at 10:14 am
#51 crowdedelevatorfartz on 11.28.19 at 10:36 pm
@#48 IHCTD9

—————————————————
“These kids have it made in the shade….”

—————————————————
Shhhhh
Dont tell the Mils in the city….they’ll want to tax their brethren…
—————————————————
IHTCD is right. The Mil engineers, doctors, dentists and lawyers I know seem to doing just fine as well.
—————————————————

Don’t make the mistake of thinking that just because doctors, lawyers, engineers, etc are doing okay now, that they will continue to enjoy the same conditions in future.

—————————————————-

Ok, sure. Or in other words, “these professions are doing really well now, but in some unrealistic and theoretical futures that some random people imagined, those types of jobs could be in jeopardy”

You work with that. I’ll stick with engineering. And I’ll take a large latte, please, with a side order of financial freedom.
————————————————————–
I’m pretty sure that if you told everyone in 1975 that in 20 years North American manufacturing jobs would be non-existent, you’d have been laughed at too.

You’ve obviously mistaken me for someone who works for a living; I was kicked out of the eleventh grade and didn’t look back, but I still retired 3 years ago – a 1%er at 51. Make yer own damn coffee, sport.

#24 Stone on 11.29.19 at 4:45 pm

Conclusions: Taxes don’t make houses cheaper. The opposite, actually. The more politicians intervene in the market and the more that’s sucked from the private sector, the more costs increase. If the object here is to chase away non-residents, forcing them to sell to locals, they’ll certainly be looking to recoup their overhead in the process. The only winner is government.

———

Wasn’t the gouvernment winning the whole point? It wasn’t about anybody else winning. Duh!

#25 Yukon Elvis on 11.29.19 at 4:49 pm

You and your squeeze can shelter almost $150,000 as of January in your TFSAs, and Bill Morneau’s sticky singers will never touch.
……………………

I hope you are right about that one. But I have a feeling they will get around to taxing that too, and maybe using the “tax free income” it might produce to claw back cpp/oas.

#26 The Greater Cauliflower on 11.29.19 at 4:52 pm

So, why doesn’t the City of Vancouver use all this vacant house tax revenue to build homes for the homeless?

#27 Stone on 11.29.19 at 4:53 pm

evil Chinese satellite families

———

Garth, other nationalities are complaining. They don’t like that you only point out the evil Chinese satellite families. They want their evil satellite family nationals also included in the spotlight. Could you be a little more inclusive? Lol

#28 Bob Dog on 11.29.19 at 5:06 pm

Taxes pay for stuff. For every tax dollar paid by an American speculator or money laundering criminal in communist China, that’s one less tax dollar I have to pay to a corrupt incompetent puppet government.

Perhaps an exploration the policies that have resulted in a city where the average home price is 11 times the average family income is in order?

This is not really what you would call a legitimate country now is it?

#29 Blutterfy on 11.29.19 at 5:08 pm

It occurred to me while reading this that perhaps this is the government’s way of taking in more cash to cover CPP and OAS? If most Canadians have their net worth in their house and can’t afford retirement then taxing their house is a bit of a money circle where to the surface it seems okay (“yay govts giving us more money! Sucks that taxes went up again, taxes and death can’t avoid it!”).

#30 Real estate on 11.29.19 at 5:09 pm

Land , land ,….land

I wonder why so many covet such a limited asset ?:)

#31 FreeBird on 11.29.19 at 5:12 pm

Even if RE prices fall in future I’m assuming all owners regardless of age are effected by taxes. Also, if new RE taxes stay in place and added to in future with eventual rising interest rates won’t both help suppress future values and maybe self defeating for those supporting the new taxes and buying RE?

Lottery wins haven’t been taxed…yet.

#32 Duffy on 11.29.19 at 5:14 pm

When the liberals place a tax on tents and cardboard boxes, voters may want to consider regime change, but only if they have the time.

#33 crowdedelevatorfartz on 11.29.19 at 5:26 pm

@#90 Ponzies pouting
“Seems IHTC and Fartz are a tandem team now.”

+++++
Jealousy wont win you any friends in blog-ville ….
You have to be smart and charming like me…. :)

#34 Sail away on 11.29.19 at 5:41 pm

#23 Sold Out on 11.29.19 at 4:44 pm
#99 Sail away on 11.29.19 at 3:03 pm

You work with that. I’ll stick with engineering. And I’ll take a large latte, please, with a side order of financial freedom.
————————————————————–

You’ve obviously mistaken me for someone who works for a living; I was kicked out of the eleventh grade and didn’t look back, but I still retired 3 years ago – a 1%er at 51. Make yer own damn coffee, sport.

—————————————-

Sorry- I take it back. I’ll make us both a cup of coffee.

#35 JohnnyAB on 11.29.19 at 5:51 pm

So if I’m renting an apartment of about 1000sq feet in a rental apartment building, should I just spend 25-20k and renovate it properly since I’m paying for it 1560/month heating and water included? I mean it’s still than paying 3500/month for a house and it’s big enough. Do you think it’s a smart move?

#36 AGuyInVancouver on 11.29.19 at 5:56 pm

Vancouver’s Empty Homes Tax has been a resounding success – part time residents have sold to full time users, units have been rented rather than left empty, and tens of millions raised for affordable housing. The vacancy rate hasn’t gone down because Vancouver’s economy is booming.

#37 Anna on 11.29.19 at 5:56 pm

And if politicians have decided nobody can keep a condo void for six months without being taxed more, what about empty nesters and their two vacant bedrooms?

That’s ridiculous scaremongering. Nobody is going to start delving in to who lives with Grannie & Grandpa and whether or not they have an extra room. So much of your writing comes across as narrative that champions the fact that the ‘others’ are coming for wealthy people’s money. Inequality has spiked to record levels and unless there is more ‘redistribution,’ unrest will follow. Since so much wealth is tied up in housing it makes sense it’s being targeted but stock market wealth sitting generating healthy returns needs to be far more taxed as well. Wealthy people can either share a little more now or ignore growing discontent and share way more forcibly later. History rhymes remember.

#38 Sail away on 11.29.19 at 5:59 pm

#4 n1tro on 11.29.19 at 2:42 pm
#87 Your buddy on 11.29.19 at 11:38 am

The correct term would be hypocritical conservative. A person who gladly enjoys the income of his wife’s current gov’t job and future pension while bragging about how little income tax he pays. Let suckers pay their share of taxes so your household can benefit seems to be your mantra.

————
Don’t hate the player, hate the game.

—————————————

Agreed, no hypocrisy whatsoever. Opportunism, definitely. Millions of years of evolution on display.

For that matter, why do you assume there is a ‘share’ of taxes?

#39 Sold Out on 11.29.19 at 6:00 pm

Conclusions: Taxes don’t make houses cheaper.

‐————-

Prices in VYR have indisputably fallen since the introduction of the aforementioned taxes. Are you suggesting it was actually the concurrent 63% drop in capital outflows from China?

#40 Sail away on 11.29.19 at 6:05 pm

#27 Stone on 11.29.19 at 4:53 pm
evil Chinese satellite families
———
Garth, other nationalities are complaining. They don’t like that you only point out the evil Chinese satellite families. They want their evil satellite family nationals also included in the spotlight. Could you be a little more inclusive? Lol

—————————————

Good point. I’ve also worked hard to become an evil capitalist. What am I- chopped liver?

#41 Adam on 11.29.19 at 6:26 pm

Taxes do make houses cheaper. Detached houses are off 12.5% according to the REBGV HPI number since 2018 – about the time all these taxes came into being.

Also, property taxes are too low in this country and income tax too high. In states like NY and California, a $2 million home would pay upwards of $40,000 per year in property tax. In West Van, the same priced home could pay closer to $4,000 – 1/10th of the amount in the US. Some of the US property tax can be deducted against income tax which means if you work and pay taxes, you can reduce your property tax bill.

In Canada, you can live in a $2 million house and benefit from all the infrastructure, schools, etc. and contribute next to nothing while working Canadians pay 50% income tax and still can’t afford to buy.

The problem is our system favours those who don’t work in Canada but own expensive property here. A lot of people with money to park have figured this out which is why property values have gone crazy. The increased property taxes will start to level the playing field but will likely need to go higher to give working Canadians a fair shake.

#42 Ustabe on 11.29.19 at 6:27 pm

When I was a kid, after spending Saturday afternoon at the movies, I’d be walking home all concerned about quicksand. Seemed to me that a lot of bad guys, good guys and livestock got caught up in quicksand.

Of course I outgrew that fear only to replace it with nuclear bombs. Then it was saving whales, next it was acid rain, then global cooling and so on.

And on it goes, somewhere, somehow seeds of discontent being sown…I’ve learned you have to ask yourself…who benefits from this?

Diversionary chaff, tossed out with what in mind? What good does it do to allow yourself to be ratcheted up to 9 over something that might happen if the sock rocket does this or that?

Its unhealthy is all I’m saying.

#43 yvr_lurker on 11.29.19 at 6:30 pm

Plus foreigners in that province also have to pay 2% annually in spec tax. The message is clear: go home. We don’t want you.

———————

Exactly; I am a homeowner with a paid off place and as I have said numerous times, I want the next generation of local citizens a chance to carve out their future and have roughly the same conditons as we had to secure their future, have families, etc… in urban environments as my generation did. For that, it is critical that housing not be commodity, not a piece on a monopoly board…. curb speculation, kick out foreigners buying from abroad parking money, no money launderers, no rabid flipping…. just homes that LOCAL people can live in and raise their families. I realize that inner-burbs will always be expensive for those that do not have inheritances or high salaries…. however, it is frankly ridiculous when a career couple making 400K per year total (through years of career advancement and diligenece) cannot even buy a teardown in Kits for 2.5M without some mega inheritance or 15 years of saving…..

When over 90% of sales are local-to-local, why do you blame non locals? Convenient, I guess. – Garth

#44 Camille on 11.29.19 at 6:30 pm

Text starts with how RSPs are so safe, from taxes. I know how they work, please spare the details.
But some say these are also open to additional taxation? Why not?

#45 Nonplused on 11.29.19 at 6:39 pm

I wouldn’t be so opposed to a capital gains tax on houses if we could deduct mortgage interest from our taxable income as they do in the states. But as it is now you pay a lot of tax on your house already in the form of income taxes on income used to pay for the house and the mortgage. Since the average person pays 3-4 times the price of the house in mortgage payments they are already paying income tax on 3-4 times the price paid for the house. (It may be lower now with these ultra low interest rates.) To tax the gains again seems perverse. Especially since the capital gains on housing are largely a factor of changes in the accounting system (dollar and inflation), not any change in the natural value of a house. A house is a house is a house. If you sell one with the objective of buying a different one in the same area, you don’t have any realized gain and a bunch of taxes and expenses already.

There are some instances where perhaps there is a capital gain on a house compared to other houses. For example inner city houses seem to appreciate faster than the new houses in the burbs. That’s due to location. But how do you determine which house is up in value because of where it is and not another, which may only be up due to inflation in the cost of building a house 1 mile further into the hay fields? It would be a mess almost as bad as the “fair share” appraisal system.

Speaking of the appraisal system, why should an intercity house be taxed more than one in the burbs just because the land is worth more? (The house almost certainly isn’t unless it has been rebuilt.) Do people who live close to downtown drive more? Do they need massive sewer pipes that run for miles? Are they using more water to maintain their non-existent yards? Are they using more electricity? Are they using more heat to heat their non-existent “bonus rooms”? Do they use the rail transit systems over great distances? The answer is no to all of these questions. An intercity home is usually smaller and has a much lower impact on all services. But yet they get taxed more because the land is worth more. “Fair share” my astrolabe. The fair share system is just another way of subsidizing the developers who fund most of the civic election campaigns.

#46 The Wet One on 11.29.19 at 6:41 pm

Speaking of being a target and real estate, I give you this: https://threadreaderapp.com/thread/1199779549803794432.html
And yes, real estate was definitely part of what was at work here.
Interesting, right?

#47 Alessio on 11.29.19 at 6:47 pm

If majority of voters are home owners there will be no principle house tax. In fact the opposite. Taxes will be increased on cap gains dividends and TFSA will be rolled back. If all else fails maybe more taxes on houses.

#48 Dr. Doom on 11.29.19 at 6:58 pm

With Alberta, Saskatchewan, and the eastern half of BC in a great recession, even though Ontario and Quebec may not be, the government finances are in serious disrepair. That is why the government is desperate to raise taxes anywhere they can find an excuse. But what they don’t realize is that there is no magic pool of money out there to be taxed. Every dollar they raise the HST through the carbon tax slight of hand is one less dollar the taxpayer has to spend on something else, which would have been taxed already.

The Trudeau government is so desperate to raise taxes that they are going to kill the economy. They aren’t going to leave enough money in the system for it to function. Their plan is to eat all the turkey’s food and still celebrate Thanksgiving. It isn’t going to work.
Prepare accordingly.

#49 jumanio on 11.29.19 at 7:04 pm

Yup, and gov can tax RRSPs and TFSAs too then.

Think not?

There were inside circle folks who thot for the last decade interest rates were gonna rise big time, other than burping a baby … NOT.

#50 Barb on 11.29.19 at 7:10 pm

“what about empty nesters and their two vacant bedrooms?”

———————————-
Perhaps Mr. T should post his blog in a secret code (for which we have the key) as it’s all coming to pass.

Let’s stop giving ideas to government…

#51 Christopher Mewhort on 11.29.19 at 7:20 pm

#46
“I wouldn’t be so opposed to a capital gains tax on houses if we could deduct mortgage interest from our taxable income as they do in the states.”

Most American home owners choose to not deduct their mortgage interest on their homes because doing so would RAISE their taxes. Funny how that works.

Christopher Mewhort, EA
mewhorttax.com

#52 Flop... on 11.29.19 at 7:49 pm

You can’t put a bungalow in your pants.- Thor Turner.

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

What about a Rancher…

M45BC

#53 MF on 11.29.19 at 7:53 pm

#14 Captain Uppa on 11.29.19 at 3:47

Already been proposed. Just a matter of time.

Real estate investors are not real investors. Their gains are 99% the product of low interest rates and nothing more. It’s a 100% manipulated market.

What government giveth, government can take away.

The market in the gta is sick, and needs to be reigned in. It’s like a man who gained 500 pounds recently and needs to lose weight. He will complain. He won’t like having to eat healthy and have to workout, but it’s important for his health.

The capital gains exemption is a policy that has led to a sickness…and it has to go ASAP.

MF

#54 Flop... on 11.29.19 at 7:55 pm

Santa doesn’t exist.

You want proof?

Last Christmas I asked him to send some interesting new posters on the blog in 2019.

Didn’t happen…

M45BC

#55 ww1 on 11.29.19 at 8:22 pm

#40 Figure it Out on 11.29.19 at 6:01 pm
I think moaning about taxes is what rich, relatively healthy old people do to signal membership in the tribe. It’d be totally un-Canadian to shout “I’m rich!” but complaining about a marginal tax rate over 50% or property taxes over $5,000 is something everyone at the local Pusateri’s can tacitly relate to without thinking themselves avaricious. As someone a little younger and (maybe?) a little less rich, IT SURE IS BORING. But I guess it’s better than hearing about gout and gallbladders.

Garth – this might be the single best post I have ever seen on this blog. And I don’t have gout – at least so far.

The young love taxes that other people pay. – Garth

#56 Maxima on 11.29.19 at 8:22 pm

This article is alarmist in already accusing Liberals of taxing principal residences.

#57 Maxima on 11.29.19 at 8:28 pm

Dr Doom: eastern BC is not in a recession. All of BC is doing well. Lots of jobs and significantly less corruption than what we suffered under the extreme right wing conservative govts who misled voters by calling themselves “liberals”

#58 Sail Away on 11.29.19 at 8:31 pm

#55 Flop… on 11.29.19 at 7:55 pm
Santa doesn’t exist.

You want proof?

Last Christmas I asked him to send some interesting new posters on the blog in 2019.

Didn’t happen…

M45BC

————————————–

That’s nice, Flop. Helpful, pleasant and inviting as well.

If you’re lucky, you might be able to find a more interesting blog.

Otherwise you’ll just have to put up with what’s here.

#59 Yukon Elvis on 11.29.19 at 8:33 pm

#55 Flop… on 11.29.19 at 7:55 pm
Santa doesn’t exist.

You want proof?

Last Christmas I asked him to send some interesting new posters on the blog in 2019.

Didn’t happen…

M45BC
……………………………..

Same here. Last Christmas I told him I wanted to have a bubble bath with Halle Berry. Didn’t happen. She never even returned my calls.

#60 Not 1st on 11.29.19 at 8:37 pm

#58 Maxima on 11.29.19 at 8:28 pm

—–

Guess you haven’t seen the new homeless tent city going up in Kelowna.

#61 Patel on 11.29.19 at 8:41 pm

You are required by law to report transactions over C$10,000 to FINTRAC.

Why the exemption on purchasing real estate?

Do you really think that an anonymous corporation that is hiring a nominee dressed in a suit and tie to bid on condemned housing in Toronto is there for a principal residence?

Are you that naiive?

#62 Fortvna on 11.29.19 at 8:41 pm

I’m aggressively trying to make up for lost time (as a financial illiterate now trying to learn and do better) and am extremely thankful to have come across this blog and all of Mr. Turner’s sage advice. I am scheduled to meet a FA at the bank on Monday to open a TFSA and will ask that the funds be put into ETFs. I’m also going to open a spousal RRSP since I earn a lot more than my spouse. I’m a bit confused about how to allocate savings between these accounts so. Should I always be maxing out my personal RRSP first? I also have an RESP and a newborn and will make sure to put in what I need to in order to avail myself of the government grant. I appreciate this is elementary so apologies in advance to the sophisticated among you. I just want to be able to direct the guy at the bank I’m meeting with…

#63 palebird on 11.29.19 at 8:57 pm

#57 Maxima

Don’t know what you are smoking. BC is not doing well at all. The gas fields in the north are dead, the forestry sector has died and mining is at a low. So what are you talking about? What other “industry” is there in BC? They legalized pot so that put a dent in the grow ops.

#64 Steven Rowlandson on 11.29.19 at 9:10 pm

“Hasn’t the exemption for houses been the overarching reason your daughter can’t afford one?”

Not sure about the daughters but sons with jobs can not live in the country they were born in and work in because buying their first home is beyond reach due to real estate being used as an investment vehicle and a tax exempt one at that. In the real world, tradesmen and other workers get paid equal to or not much better than minimum wage and work weeks are not as much as 40 hours. This year I will be making slightly better than my personal exemption. The maximum home price I could afford is close to $30,000. I am 59 years old. Deliberately making a normal life impossible by any means is genocide. It does not matter if it is for profit or for hate. It creates conditions of life that destroy a group in whole or in part and in part extends right down to the individual. The means does not matter either. It could be incarceration in concentration camps or jacking up the price of the necessities of life to the point where people are forced to live in cars, card board boxes, hobbit holes, under bridges in tents, vermin infested over priced rooms or park benches because the alternative is a genocidal extortion racket or death. Life is not a monopoly game and this country should not be one of doctor John Calhoun’s mouse utopia experiments. Unfortunately it is just that.

#65 Ustabe on 11.29.19 at 9:13 pm

@ #47 The Wet One

At the moment words escape me, all I can say is thank you for providing that link.

#66 ImGonnaBeSick on 11.29.19 at 9:24 pm

You can’t put a bungalow in your pants.- Thor Turner.

—————–

What about a semi-detached?

#67 Ustabe on 11.29.19 at 9:27 pm

Yukon:
Same here. Last Christmas I told him I wanted to have a bubble bath with Halle Berry. Didn’t happen. She never even returned my calls.

Years ago she was filming a movie just outside of Victoria on the grounds of the old Royal Roads campus.

Friend of mine who was, at the time, into high end catering had the contract for food on site.

He called, knowing my infatuation for the woman, told me to grab a haircut, slip into some black pants/white shirt and he’d hook me up.

Thinking I’d man a station of a buffet line I drove down only to find he had me serving her lunch in her trailer!

Me and Halle, alone* in her trailer for over an hour.

Hope you can handle that info…

* alone except for PR people, makeup people, costume people, just people who ebbed and flowed the entire time she ate. I asked her why she didn’t demand to be left to her lunch in peace, she just sort of sighed/smiled at me and that is that, I guess.

#68 Lee on 11.29.19 at 9:27 pm

Are they going to tax doll houses too?

#69 Robert Ash on 11.29.19 at 9:30 pm

Thanks to the Blog Dog, who posted the Link to Neil Howe, and the Fourth Turning Thesis… Neil Howe, explains, why a lot of the current policies, are in fact being designed by Politicians, for Millenials.. Neil Howe is apparently the Sociologist who coined the Phrase Millenials… His insights are quite interesting, and like Financial markets, follow cycles… As often most of Human interaction does… rises and falls, etc.. The interesting trends in Society seem to follow behaviorial patterns, and the Mills, definitely want Bigger Government, they want less Democracy, and more Autocracy, more of the Sharing etc… and feel, that the Boomers, have had a Charmed life.. He doesn’t suggest that Mills, are lazy etc… simply highlights, the differences, in Generational thinking..that has come from different Social shocks… Most of which is proven in the Demographic stats… He seems, to hit the mark…So I think I gained a lot of insight from this information.
What I find interesting, is that if the Conservative party of Canada, had researched a few of Neil’s Thesis, and conclusions, thier Policy Platform would have been quite different… For example, Governments, creating money is perfectly acceptable to Mills, and since they create Fiat currency, then there is no real reason, to focus on Deficeits… Yet our Conservative leaders tried to sell Deficeit reduction to the Mills, the largest group in the 905…Quite contrary, to what they in fact want… I found it amusing, but somewhat sad, at the complete lack of understanding of the Conservative fraction, and I am a Fiscal Conservative.
The subtle differences in the ideas, convictions, morays, attitudes, are definely relevant.. and we will produce a quite different electorate in the next decade.. The Boomer Echos.. later Boomers, wanted total divorce from Governement, self determination, accounability, freedom, from Governement interference… so the Vietnam Teens, as is somewhat logical, arrived at conclusions, and values quite different, then the new voters of today. who were shocked by the GFR. Sadly there is a serious bent away from Democracy, and towards well a mild form of Communism… This man, Neil Howe is quite successful, and his work, is accepted by very large Organizations, like the US Marines, Nike, Microsoft, etc etc…Worth a look in my opinion.

#70 Inspired Investor on 11.29.19 at 9:41 pm

Hi Garth,

Can you, please, explain this in a simpler language? And maybe you have also some piece of advice to share…

Q. What Investments Can I Hold in My TFSA?

A. In short, largely the same ones you can hold in a Registered Retirement Savings Plan (RRSP). Despite their name, Tax-Free Savings Accounts (TFSAs) are more of an investment account than a traditional savings account. TFSAs allow for a range of investments, such as cash, guaranteed investment certificates (GICs), bonds, stocks, exchange-traded funds (ETFs), mutual funds and options. There are two key points to keep in mind when choosing your TFSA investments:

1. The Canada Revenue Agency only allows qualified investments in a TFSA. Generally, if a security trades on at least one exchange that’s considered a Designated Stock Exchange by Canada’s Finance Department, it will be recognized as a qualified investment. Among those exchanges – of which there are around 46 — are the NASDAQ, NYSE, LSE, TSX and more. Holding non-qualified investments can have tax consequences and may result in penalties levied by the CRA.

2. If you choose to include investments in your TFSA that pay foreign dividends, many governments — including the U.S. — apply a non-resident withholding tax to dividends and interest. That means the tax may reduce an investor’s return.

#71 fishman on 11.29.19 at 9:42 pm

Ed Fast is the new Kingmaker for the Conservative Party. A good ole B.C. boy. Gotta like it.

#72 PetertheSeparatistfromCalgary on 11.29.19 at 9:51 pm

An independent Alberta would not be robbed by these crazy taxes. Only independence will keep Albertans safe from crazy Justin and his cabal.

#73 YouKnowWho on 11.29.19 at 9:56 pm

Bulldog

Thor!

#74 CEW9 on 11.29.19 at 10:14 pm

I do agree that keeping all of your assets in one thing (real estate) is really quite risky.

I also know that governments are fickle and usually govern by poll results. With the Mils finally moving out of their parents basements and buying homes, combined with them being the most populous generation since the boomers, I also think that their opinions will also change and that polling will reflect that.

Everyone supports taking government money and no one supports new taxes (even on real estate). With 70% home ownership in Canada, popular opinion will be against any new real estate taxes.

A good recipe for another debt crisis.

#75 crowdedelevatorfartz on 11.29.19 at 10:27 pm

@#50 Dr Doom
“The Trudeau government is so desperate to raise taxes that they are going to kill the economy. They aren’t going to leave enough money in the system for it to function. ”
+++++

Economics 101
Alas….. our Prime Minister became a Drama Teacher

#76 crowdedelevatorfartz on 11.29.19 at 10:31 pm

@#53 Flop
“What about a Rancher…”
+++++

The visuals disturb me

#77 Yukon Elvis on 11.29.19 at 10:45 pm

#68 Ustabe on 11.29.19 at 9:27 pm
Yukon:
Same here. Last Christmas I told him I wanted to have a bubble bath with Halle Berry. Didn’t happen. She never even returned my calls.

Years ago she was filming a movie just outside of Victoria on the grounds of the old Royal Roads campus.

Friend of mine who was, at the time, into high end catering had the contract for food on site.

He called, knowing my infatuation for the woman, told me to grab a haircut, slip into some black pants/white shirt and he’d hook me up.

Thinking I’d man a station of a buffet line I drove down only to find he had me serving her lunch in her trailer!

Me and Halle, alone* in her trailer for over an hour.

Hope you can handle that info…

* alone except for PR people, makeup people, costume people, just people who ebbed and flowed the entire time she ate. I asked her why she didn’t demand to be left to her lunch in peace, she just sort of sighed/smiled at me and that is that, I guess.
…………………..

I hate you.

#78 crowdedelevatorfartz on 11.29.19 at 10:46 pm

@#58 Maxima
“Dr Doom: eastern BC is not in a recession. All of BC is doing well. Lots of jobs and significantly less corruption than what we suffered under the extreme right wing conservative govts who misled voters by calling themselves “liberals””
+++++

Fair enough.
I held my nose and voted NDP to get the Clark “Liberals” packing…
But to assume “BC” is immune to a recession?
Pfft.
Give your head a shake.
Mills closing all over the Province.
Housing sales ( and prices) tanking.
The only major projects I have seen announced are federal, and provincial infrastructure projects…..
Several levels of govt pumping (bleeding?) taxpayer money into projects that are either desperately needed OR “pie in the sky” feel good poser projects…

https://www.citynews1130.com/video/2019/11/27/massive-spinning-chandelier-unveiled/

The chandelier cost $4.8 million dollars….I’m sure the homeless are thrilled…..but the pigeons are even happier……a warm seat for their arse.

lets have this conversation again in 12 months.

#79 crowdedelevatorfartz on 11.29.19 at 11:00 pm

@#60 Yukon Elvis
“Last Christmas I told him I wanted to have a bubble bath with Halle Berry. ”
++++=
:)

I was working downtown Van when Ms Berry was filming Catwoman.
She was staying in the hotel next to the building I worked in.
EVERYONE i worked with saw her, talked to her, got autographs, on and on and on.
I never saw her. Ever.
My crappy luck.
Typical.
The final straw was when our Fed Ex delivery person shoed up laughing, ” I just delivered Halle Berry’s panties….”
The entire male population of the office went silent and gulped……
I said, ” Bullshit!”

Apparently Ms Berry had a specific type of undies that she wore delivered to the hotel….under her assumed name ( she aint staying as Halle Berry at a hotel)….anyway.
Canada Customs had broken open the box full of undies looking for …..whatever. (yeah right).
AND, when my fed Ex amiga ( a girl) had to get the box signed off….. a HUGE body guard came down and sheepishly signed for Halley’s unmentionables……

True story
“six degrees of perspiration” is my motto

#80 crowdedelevatorfartz on 11.29.19 at 11:04 pm

@#72 fishman
“Ed Fast is the new Kingmaker for the Conservative Party. A good ole B.C. boy. Gotta like it.”
++++

“Fast Eddie”?
Seriously?
My God.
The Conservatives will be battling THAT moniker until getting elected in 2030

#81 CAFE on 11.29.19 at 11:14 pm

DELETED

#82 CAFE on 11.29.19 at 11:18 pm

DELETED

#83 CAFE on 11.29.19 at 11:24 pm

The Met has identified the London Bridge attacker as Usman Khan, a 28-year-old man released from prison on a licence (parole) in December.

#84 crowdedelevatorfartz on 11.29.19 at 11:27 pm

@#73 peterAndHisDelusionalRavings
“Only independence will keep Albertans safe from crazy Justin and his cabal.”
+++++

After Quebec’s last “We’re Leaving threat”…..the feds changed the rules…..

You’re stuck with what ever “Cabal” rules in Ottawa.

best keep voting in federal politics or have Ontario MP Chrystia Freedland (ironic, dontcha think?) as your “western spokesperson”………

https://en.wikipedia.org/wiki/Deputy_Prime_Minister_of_Canada

#85 Paul on 11.29.19 at 11:28 pm

“Black Friday: Because only in America do people trample others for sales exactly one day after being thankful for what they already have.”

#86 TC on 11.29.19 at 11:46 pm

We are all getting closer and closer to that final pivot point when it all comes crashing down for everybody! Keep up the progression to more and more taxation and debt and over the abyss we will all go! Everyone will lose from boomers, to millennial’s, from the employed to the pensioners. Lets all get it on for the return to the roaring 20’s again and try to repeat market history 100 years later in 2029!

#87 Rexx Rock on 11.30.19 at 12:08 am

My mother’s mobile home in a retirement complex in Victoria has went up 73% since 2014 according to her assessments.I know wages didn’t go up that much.Inflation is huge in Victoria,like many cities in Canada.We are not in normal times and I can’t seem to know why this was allowed to happen?

#88 H.Peter on 11.30.19 at 12:18 am

Re.: #9 Gerti.
I am being taxed on my rainwater here? Now furiously googling that…..Snow too?

#89 Smoking Man on 11.30.19 at 1:20 am

The second ear of Batman has been drawn on the real estate chart.

For old fans that know me, you know what that means…

#90 jerry on 11.30.19 at 2:11 am

When over 90% of sales are local-to-local, why do you blame non locals? Convenient, I guess. – Garth

The home buyers who can pay the most are the ones who set the price in real estate markets and that is why foreign buyers or foreign capital have such a large impact. Most economists agree that even 5% of foreign buyers combined with low inventory can have a very large impact on prices. FOMO certainly played a part as well but this didn’t create the 2,3, or 4 million dollar homes we see all over the city. That foreign money created a ripple effect throughout the entire province of BC. This debate ended long ago in Vancouver with mountains of study and evidence. Here is what the BC Supreme Court had to say on the recent ruling on the BC foreign buyers tax
“the evidence shows that the Tax reduced foreign demand in all segments of the real estate market; had a significant impact on the price of residential real estate”
“The view that foreign nationals significantly contributed to the escalation of prices of housing in the GVRD is neither a stereotype nor a continuation of racist policies from the past. The experts have agreed that the inflow of foreign capital has significantly contributed to price increases in the GVRD.”

https://www.bccourts.ca/jdb-txt/sc/19/18/2019BCSC1819.htm#_Toc22721539

#91 Smoking Man on 11.30.19 at 2:17 am

DELETED

#92 Ferdinand McMillan on 11.30.19 at 3:59 am

I believe Trudeau will force homeowners to accept migrating votes into spare bedrooms. There’s no other reason for his reintroduction of the expanded long form census which required such information be made public. Germany and the UK have already begun confiscating houses from seniors.

I believe that Trudeau would already announced a confiscation of capital gains on house appreciation if he had won a majority. This is a George Soros initiative. Weakened democracies have been sucked into a massive wealth distribution trap.

I believe that the UN Plan 2030 is to disrupt the structure of Western Democracy in favour of a one world government. This has been announced. They’re throwing it in your face. Be prepared. Make sure real estate is not the main plank in your retirement plan.

I believe that this parellel with throwing seniors out if date will resemble seniors who have taken out Reverse mortgages. You have to be an idiot to think that you’ll stay in your house forever after the mortgage exceeds the value of the home. Look at the contracts..designed to foreclose.

#93 Where's Our Money Going Everyone? on 11.30.19 at 6:23 am

An addendum to the “money manager” installed on your bank accounts by MX Technologies out of Lehi, Utah, and all ATM, phones etc.
Include 2 point bank ID verification (company with miltary connections along with MX out of New York), because they have it all anyway.
https://en.wikipedia.org/wiki/Utah_Data_Center

Big Brother indeed!
If I don’t post here anymore, just call it a sacrifice fly, hehe.
The mafia at least had rules to keep order…..
Are we beholden to China or the US? I think it’s time to choose, or has the choice already been made.
My recollection from the early 90’s Clinton admin showing Clinton giving free roam to Chinese Triads at the White House.
There’s proof……

#94 Where's Our Money? Search on 11.30.19 at 7:14 am

Re: #90 Smoking Man on 11.30.19 at 1:20 am
The second ear of Batman has been drawn on the real estate chart.

For old fans that know me, you know what that means…
+++++++++++++++++++++++++
So I guess it’s Uppa she goes if you mean the bottom of the ear. Another ten years of RE inflation and taxes.
Ho hum.
I guess I missed that drop, if you call 15-25% drop off double/3x the prices in the last couple years a drop.
See you all on the street, no matter if you own or not.
Canada will be a gated community and you’ll be Airbnb’n the local dumpster as 5 star accommodation prices.

#95 Dharma Bum on 11.30.19 at 8:38 am

Hasn’t the exemption for houses been the overarching reason your daughter can’t afford one? – Garth
——————————————————————–

Not really.

It’s because she lives in Toronto and doesn’t make enough money for GTA houses.

If she lived in Ottawa, or London, or Kingston, or Windsor, or Regina, or Red Deer, or Moncton, or Dartmouth, or Winnipeg, she could afford one.

A couple of my other kids moved out of Toronto and they have really nice houses.

It’s only in stupid markets that houses are ridiculously expensive.

I just met a dude (while hanging out down here in Phoenix) who lives in Winston-Salem. He bought his house there 35 years ago for $60K, and was bragging that it’s now worth $280K.

I told him that an equivalent house in Toronto or Vancouver would cost at least a Mil.

He just laughed.

Silly Canadians.

The house you can buy down here in the greater Phoenix area for a $million would cost $6 to $8 million in Toronto. I’m talking about sprawling estates in gorgeous settings.

Normal, beautiful homes down here in fantastic neighbourhoods selling for between $350K – $475K that are better than what you’d get for $1.5 mil – $2.5 mil in the GTA.

And I went to a Leaf game here for $45 and saw them win for a change.

Life is better outside of Toronto.

#96 crowdedelevatorfartz on 11.30.19 at 8:38 am

Welcome to the “Vancouver Model’

https://theprovince.com/business/local-business/money-laundering-in-real-estate-in-bc-not-new-multiple-ways-to-get-money-into-financial-system/wcm/59f1d682-0b9a-49d0-bec3-1b92fa0ec955

#97 not 1st on 11.30.19 at 9:22 am

#96 Dharma Bum on 11.30.19 at 8:38 am

If she lived in Ottawa, or London, or Kingston, or Windsor, or Regina, or Red Deer, or Moncton, or
Dartmouth, or Winnipeg, she could afford one.

—-

The walking woke in Toronto might be surprised to hear lots of people who live in those places own a second home in Phoenix or Palm Springs or BC.

Best place in any major urban center in the country right now to buy a home is Calgary. I will take the Rockies over the Raptors any day of the week.

#98 Mathew S Gibson on 11.30.19 at 9:36 am

The young love taxes that other people pay. – Garth

Everyone loves taxes other people pay. No need to hate on the young.

Merely referencing the source of the comment. Chill. – Garth

#99 Jenny Wang on 11.30.19 at 10:19 am

Time to lock in to the melt up.

https://finance.yahoo.com/news/records-set-billions-minted-hard-181030572.html

I’m banking on a historical FOMO event taking the market way up when greedy retail punters and all the scaredy cat institutional finally decide to panic and get in. These two groups are the majority with most of their money in cash.

There’s only two elements at play, fear and greed. Greed always wins. I forecast a 25% blast off in 2020 that will suck in the whiners, and then Dow 40,000 by year end.

Having said that, the TSX will be value heaven after Poloz lowers rates and the GiC crowd sees there’s no hope .

#100 Ian from Oshawa on 11.30.19 at 10:37 am

Big article floating on MSN about how BC insurance on condos is going to go up 50-300%.

My God … a huge mortgage on a cement box, condo fees, and now astronomical insurance? So, then what? Sell? Who is going to want to buy that debt load?

You called it, Garth. You said there would be regrets and here they come!

#101 Lorne on 11.30.19 at 10:45 am

#91 jerry on 11.30.19 at 2:11 am
When over 90% of sales are local-to-local, why do you blame non locals? Convenient, I guess. – Garth

The home buyers who can pay the most are the ones who set the price in real estate markets and that is why foreign buyers or foreign capital have such a large impact. Most economists agree that even 5% of foreign buyers combined with low inventory can have a very large impact on prices. FOMO certainly played a part as well but this didn’t create the 2,3, or 4 million dollar homes we see all over the city. That foreign money created a ripple effect throughout the entire province of BC. This debate ended long ago in Vancouver with mountains of study and evidence. Here is what the BC Supreme Court had to say on the recent ruling on the BC foreign buyers tax
“the evidence shows that the Tax reduced foreign demand in all segments of the real estate market; had a significant impact on the price of residential real estate”
“The view that foreign nationals significantly contributed to the escalation of prices of housing in the GVRD is neither a stereotype nor a continuation of racist policies from the past. The experts have agreed that the inflow of foreign capital has significantly contributed to price increases in the GVRD.”

https://www.bccourts.ca/jdb-txt/sc/19/18/2019BCSC1819.htm#_Toc22721539
…….
Excellent info and what many in YVR have always believed. Surprisingly, no comment by Garth.

Why bother? You’ll believe what you want. Victim mentality. – Garth

#102 Mathew S Gibson on 11.30.19 at 10:45 am

Merely referencing the source of the comment. Chill. – Garth

No, you are generalizing against one particular group and it’s beneath you.

Actually I irritate everyone – moisters, Boomers, wrinklies, vapers, governments, [email protected], Dippers, Adele, those who shop at Costco and anyone driving a Kia. Get used to it. – Garth

#103 Don Guillermo on 11.30.19 at 10:50 am

#98 not 1st on 11.30.19 at 9:22 am
#96 Dharma Bum on 11.30.19 at 8:38 am
If she lived in Ottawa, or London, or Kingston, or Windsor, or Regina, or Red Deer, or Moncton, or
Dartmouth, or Winnipeg, she could afford one.
—-
The walking woke in Toronto might be surprised to hear lots of people who live in those places own a second home in Phoenix or Palm Springs or BC.
Best place in any major urban center in the country right now to buy a home is Calgary. I will take the Rockies over the Raptors any day of the week.

********************************************

Careful, the LM/Island people will start foaming at the mouth and tell you how crazy you are for not worshipping their soggy world.

#104 Shawn Allen on 11.30.19 at 11:12 am

Higher Property Insurance Rates?

Well, maybe invest in property insurance companies.

Is there sufficient competition?

Why is Berkshire Hathaway not active in Canada?

Interestingly, Berkshire has basically never offered residential property insurance. GEICO sort of does but only on a commission basis and it is not the actual company doing the insurance.

For whatever reasons, Buffett did not find residential property insurance to be a good business in the U.S.

#105 Don Guillermo on 11.30.19 at 11:15 am

On a positive not:

An amazing group of New Zealand children singing Dylan songs. The lead singer is incredible and will warm even the coldest indebted hearts.

https://www.youtube.com/watch?v=VKFgLNBpQK0

#106 yvr_lurker on 11.30.19 at 11:52 am

#91 and #102
—————-
This is exactly how i see it. However, I don’t think it would make any difference to those right-wingers whether the conclusion that a major factor in the run-up in prices was due to foreign nationals came from the BC courts or divine decree. They believe what they want to, despite mounting evidece (Andy Yan’s detailed studies etc…). I just know what it looks like on the ground here in the neighbourhoods on te west side where I live.

‘Right’ or ‘left’ has nothing to do with an analysis of Van real estate. Foreign buyers have exited the market and you still can’t afford a home. Duh. Stop blaming straw men. – Garth

#107 yvr_lurker on 11.30.19 at 12:18 pm

#42 Adam

In Canada, you can live in a $2 million house and benefit from all the infrastructure, schools, etc. and contribute next to nothing while working Canadians pay 50% income tax and still can’t afford to buy.

The problem is our system favours those who don’t work in Canada but own expensive property here. A lot of people with money to park have figured this out which is why property values have gone crazy. The increased property taxes will start to level the playing field but will likely need to go higher to give working Canadians a fair shake.

—————————————–
Indeed these are key factors on why many rich foreigners parked their cash in YVR. Once one pays the one-time property transfer tax, the yearly property taxes on mega-homes are much less that elsewhere (California etc..). You can then benefit from all the Gov’t services, all the while working overseas as a satellite family sheltering your income from the CRA, and declaring 30K a year in taxable Canadian revenue.

All the while for local citizens who are high wage earners trying to get ahead with no inheritance, no family plan, nada except their own hard work, there has been much upwards pressure on the highest marginal tax rate rate.
Puts a big headwind on trying to save. My little family has paid roughly 600K in income tax alone over the past 5 years. The satellite family coming in as described above leads to a windfall for one specific family (the seller), pays the one time property tax of say 65K on a 3M place. With their non-taxable income going forward, which of these two scenarios is contrbuting more to the funding of hospitals, schools, etc…
These comments are not directed towards any ethnic group and I don’t think they are xenophobic. Just level the playing field and put measures in place to discourage satellite families, non-residents parking money in real estate. Strongly encourage through immigration those skilled workers who will contribute towards developing high-tech startups, forward thinking industries, and give good tax credits for those setting up these businesses in smaller towns (like Nelsom, Kelowna, Courtenay,…) so that they can be less reliant on the natural resource sector.

#108 yvr_lurker on 11.30.19 at 12:25 pm

#107
‘Right’ or ‘left’ has nothing to do with an analysis of Van real estate. Foreign buyers have exited the market and you still can’t afford a home. Duh. Stop blaming straw men. – Garth

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Last post as I give up for today. We have a home that we like that is all paid off. No problem with that, and I do not aspire to upgrade. I am concerned with my kids, my friends kids, the kids I work with through my job, on them being able to be an environment that has the same opportunities as I had with regards to housing, jobs, etc. Under the corrupt BC liberal regime, they had no hope. Now with price rollbacks there is a little more help, and if we have another 5 years of more rollbacks at a lower rate, it will be a better environment for the next generation. I can easily see the NDP winning the next provincial election, and keeping in place measures they put in for another 5 years. Then, we can talk.

#109 Ace on 11.30.19 at 1:52 pm

I live just outside of Newmarket, rent in a new subdivision here. Moved in during mid summer, there were 3 empty houses that I could tell. Now there are at least 5 empty houses on my little street. That’s only on my street (there are many others in this subdivision!) Whether or not it helps ease the market (it won’t, only an interest rate hike would do that) it will generate a lot of extra $$$ for nothing.

#110 Sail Away on 11.30.19 at 2:40 pm

#105 Shawn Allen on 11.30.19 at 11:12 am
Higher Property Insurance Rates?

Well, maybe invest in property insurance companies.

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Genworth Canada (MIC.TO) has been good to me.

#111 Christopher Lee on 11.30.19 at 4:00 pm

Hi Garth,
I have witnessed, as so many here, relentless demolitions of perfectly fine houses,all in the name of profiting fom an unsustainable boom.It will evenually end,badly.
Debt,Taxes,Fees.etc will all contribute to the ending of this craziness.
As you all too often refute,what to all is obvious,rampant speculation.money laundering and a complete disregard to the laws of this country which made it such a great place to live.
Let the government.Regulate,Tax,and pummel these individuals however they can to stop this insanity.
How is it,some are allowed to flirt the laws,yet others are held to the fire.
Time for Revenue Canada,RCMP,and all other agencies to track where all this money comes from.
The next generation is now screwed,and government policies have ensured this.
Facts are Facts.

#112 PetertheSeparatistfromCalgary on 12.01.19 at 12:12 pm

The carbon tax is a huge tax on housing especially in the colder parts of Canada. I guess Trudeau things living in the arctic is not expensive enough.

#113 Phylis on 12.01.19 at 4:12 pm

Actually I irritate everyone – moisters, Boomers, wrinklies, vapers, governments, [email protected], Dippers, Adele, those who shop at Costco and anyone driving a Kia. Get used to it. – Garth

Garth, you are slipping. How could you leave out real-estate people of your primary list?

#114 Scott on 12.01.19 at 10:49 pm

Hey Garth,

I understand that you think it’s unjust to tax the empty nesters but would it not be an incentive for them to rent it out for the six months they are gone. I think that is the point. I don’t think that’s such a bad thing. I’ve had to go away for a two month stretch twice for work. Both times I’ve left I have lent my car to someone while I’m gone. Not doing any good sitting in a parking lot.