Rabidoux in Vancouver / HK property tax

A couple of news tidbits today:

First off Ben Rabidoux will be putting on a seminar in Vancouver about how to get rich flipping presales condo contracts.

At least I assume that’s what he’ll be talking about, what else could you talk about at a Vancouver real estate seminar?

Ben will be joined by David LePoidevin and they’ll actually be talking about the current state of the market, what comes next and what a ‘hard landing’ would look like for the economy and your investments.

Could Canada be facing a housing crash similar to what the US experienced?  As Canada’s most expensive real estate market, how will Vancouver fare?  What are the broader implications of a significant housing correction on the Canadian economy and job market?  What would a housing crash mean to your investment portfolio, and how can you protect yourself?

The event is at the Westin Bayshore on Wednesday November 28th at 7pm.  Registration is free, but first come first served.  There will be a Q&A session and a speculator dunk tank.  (Sorry, made that last one up.)

Also in the news, Mike sent in this note about a new property tax imposed in Hong Kong for non-resident buyers. Non-local and corporate buyers will now pay an extra 15% tax on purchase of property.  Hong Kong joins similar moves by Singapore and Australia to squeeze extra money out of foreign investors and give local buyers a market advantage to housing.

The 15 percent tax “will be effective in curbing foreign demand – mostly from mainland buyers – and avoiding ‘hot money’ influx into the property market,” Alfred Lau, a Hong Kong-based analyst at Bocom International Holdings Co., wrote in a report today. “However, local demand is not affected.”

The new property tax doesn’t apply to Hong Kong permanent residents. Inhabitants need to live in the city for seven straight years to be eligible for permanent residency, according to immigration rules, while Chinese citizens born in the city are automatically granted that status.

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VMD
Member

Canada’s deputy minister of finance says he isn’t convinced tighter mortgage rules his department announced in June are behind the recent cooling in the housing market.

Mr. Flaherty: “I’d certainly agree that the full impact of the changes to mortgage rules has not been felt yet”
http://www.theglobeandmail.com/report-on-business/economy/economy-lab/finance-official-questions-link-between-cooling-housing-market-mortgage-rules/article4741736/

Rusty's Ghost
Guest
Rusty's Ghost

those HKers are a bunch of racists

http://youtu.be/T-02lNhR8j0

patriotz
Member

@VMD:

Mr. Flaherty: “I’d certainly agree that the full impact of the changes to mortgage rules has not been felt yet”

Whaddaya know, I agree with Mr. Flaherty 100%. Just you wait.

As for HK’s 15% tax, I think BC ought to charge 15% on all transactions (that’s right a 15% PTT), and rebate it back to buyers on their income tax returns provided they declare an income commensurate with the value of the property purchased.

victoria
Member
victoria

Our government would not have the balls to put a foreign property tax out there. We are a haven for hot money. The OECD used to criticise Canada about its lax regulations.

I know – I used to sit in on the money laundering meetings at the OECD.

Anonymous
Guest
Anonymous

@patriotz: “As for HK’s 15% tax, I think BC ought to charge 15% on all transactions (that’s right a 15% PTT), and rebate it back to buyers on their income tax returns provided they declare an income commensurate with the value of the property purchased.”

That would be great for seniors and other low income people who own homes and have to move for some reason.

jesse
Member

@Anonymous: “That would be great for seniors and other low income people who own homes and have to move for some reason”

Which is why a 15% PTT is a non-starter. The refrain of the provincial and municipal elections should be a clue the electorate is incapable of dealing with the root of the problem. It would be inconvenient to balance sheets if they did.

metalhead
Member
metalhead

http://tinyurl.com/98u6k22

Benjamin Tal says, relax, fuhgeddabotit, no speculation here.
Oh sure, prices might drop for a couple of years but that’s about it.

Bwahaaaahaaaaa.

frank
Guest
frank

@patriotz:

“As for HK’s 15% tax, I think BC ought to charge 15% on all transactions (that’s right a 15% PTT), and rebate it back to buyers on their income tax returns provided they declare an income commensurate with the value of the property purchased.”

What an excellent idea. This would also help prevent the flow of drug money into property- both high end and interior ranches. Any-one who doesn’t claim the rebate should set off red flags to enquire how that money was obtained.

however this is too radical and logical for our politicians.

boogeybear
Guest
boogeybear

15% may seem expensive to us, but if you’re trying to launder money or you’re trying to move the money to a safe haven, then the tax is just another cost of doing business.

We pay 12 percent on candy, that has not stopped us from buying chocolate bars.

Makaya
Member
Makaya
@metalhead: From the Globe: No U.S.-style housing crash for Canada: report Some tidbits: It forecasts that the Canadian market will likely go through a soft landing, which is exactly what policy makers in Ottawa are hoping. (…) Factors that should cushion the damage that lower house prices could cause include a lower degree of speculation in the Canadian market, and higher quality mortgages, the report says. (…) But CIBC deputy chief economist Benjamin Tal says in this report that less attention should be paid to the level the debt-to-income ratio has hit, and more to the speed at which it has been rising. A number of other countries have had higher ratios without a crash, he suggests. And in the last three years the ratio in Canada has been rising at half the speed that it did in the pre-crash… Read more »
watcher
Guest
watcher

HK prices are up 20% year on year_ the market conditions are quite different

More Data Please
Guest
More Data Please

@Victoria: Any juicy OECD Canada laundering annecdotes?

Looking on the OECD website I found a fairly generic but detailed report on real estate money laundering transaction techniques related mainly to land purchase, development, and redevelopment:

http://www.oecd.org/ctp/exchangeofinformation/realestatesector-taxfraudandmoneylaunderingvulnerabilities.htm

Please tell us more about your OECD experience as it relates to Canada. If anonymity is a factor in your reply, I’ve determined that the vancouvercondo.info server is presently located at:

Host Name: apache2-jolly.alnair.dreamhost.com
IP Address: 173.236.203.17
Country: United States
Country code: US (USA)
Region: California
City: Brea
Postal code: 92821

Futher, and thankfully, despite VPD Chief Jim Chu’s effort so far to install domestic internet surveillance at your local Canadian ISP (aka Bill C-30), the facility to record the ordinary messages of concerned citizens originating from your IP for future data mining does not exist. Hopefully that is assurance enough for you post something interesting to this forum.

Anura Femur
Guest
Anura Femur

I doubt any of you would know a mainland Chinese if one bit you on the nose.

Simple
Guest
Simple

@Anura Femur:

“I doubt any of you would know a mainland Chinese if one bit you on the nose.”

OH MY GOD! THEY DO THAT?!? I thought it was just shark fins, bear gall bladders, tiger penises, rhino horns on so on.

Thanks for the warning Anura.

klipsh
Guest
klipsh

Victoria: “Our government would not have the balls to put a foreign property tax out there. ”

i am not sure even if we are allowed under NAFTA? We would have to consult first our masters in Washington.

Boombust
Guest
Boombust

“We would have to consult first our masters in Washington.”

I’m sure they wouldn’t mind if you went through their top bureau chief in Ottawa. Harper something or other…

Boombust
Guest
Boombust

“Mr. Flaherty: “I’d certainly agree that the full impact of the changes to mortgage rules has not been felt yet”

A liar and a creep all rolled into one.

Anonymous
Guest
Anonymous

@klipsh: “i am not sure even if we are allowed under NAFTA? We would have to consult first our masters in Washington.”

Hey Klipsh, the 90’s called and wanted their labour band wagon back. Good grief.

Clearly the problem was implementation of the metric system, or maybe it was prohibition?

T
Guest
T

Doesn’t that new 31 year investment deal with China impact our abilities to curb foreign speculation?

900kCrackHouse
Guest
900kCrackHouse

And to further put a dent in the BC real-estate market, if Washington State legalizes pot this will further reduce demand. Unless everyone growing pot moves over to meth labs.

Anonymous
Guest
Anonymous

@patriotz: “I think BC ought to charge 15% on all transactions (that’s right a 15% PTT), and rebate it back to buyers on their income tax returns provided they declare an income commensurate with the value of the property purchased.”

I know you mean to be flippant and funny, but I just find this utterly idiotic. This is a free country. You’re allowed to have assets without a commensurate income. Fool!

Not much of a name...
Member
Not much of a name...

@Anonymous: I agree 100%. What happens in the event of an inheritance? Friends of mine purchased a house that was over $1.4M. How…the husband was sole heir to his parents’ estate. They used that money and sold their townhouse to make the purchase. Their incomes would never support a purchase of a house like that if they were to try to finance it.

Anymouse
Guest
Anymouse

http://en.wikipedia.org/wiki/Stereotypes_of_East_Asians_in_the_United_States#Perpetual_foreigner

same goes for Canada. half of this city thinks the other half are foreigners. they give account after account of debt driving misadventures of their own, yet constantly point the finger at the ‘other’. it’s toxic, and it seems to run deep in this board in particular.

Veni Vidi Vci
Guest
Veni Vidi Vci

@Not much of a name…: “the husband was sole heir to his parents’ estate. They used that money and sold their townhouse to make the purchase.”

Well then the inheritance was part of his income making it able to buy the house. It’s on record, just like lottery winnings, business income or salary.

I don’t see what the problem is, all Patriotz proposal would do is make criminals pay slightly more for property than someone who shows where the money comes from.

Vote Down The Facts
Guest
Vote Down The Facts

@Veni Vidi Vci: “I don’t see what the problem is, all Patriotz proposal would do is make criminals pay slightly more for property than someone who shows where the money comes from.”

You do realize it’s quite possible to be (legally) wealthy and yet receive no income?

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