Let the grandkids solve the TFSA problem.

If you’re someone who has your money somewhere other than Vancouver real estate you’re probably familiar with the TFSA.  And you probably know the limit has just been doubled to $10k a year.

Critics say this move only helps the wealthy and creates a future tax problem.

Joe Oliver says we should leave that problem for the PMs grand-daughter to solve.

On Tuesday’s The Exchange with Amanda Lang on CBC News Network, the finance minister told Lang that criticism of his recently unveiled budget is unfounded, arguing that the benefits for Canadians today more than offset any future revenue problems associated with it that may or may not ever come to pass.

The doubling of the TFSA limit to $10,000 per taxpayer every year was a core plank of Oliver’s balanced budget. But critics including the opposition parties and private sector economists have said the populist move will create a revenue problem for governments down the line, as more and more investments get protected from taxation.

So what do you think about the TFSA limit increase? A tool only for the wealthy or a bit of extra help for savers?

Sort by:   newest | oldest | most voted
Yunak
Guest
Yunak

@47 The 62-year-old pensioner was stripped of his passport, escorted out of the country, and banned from the Schengen Area for two years.

That’s how it’s done in serious countries, they know well locust’s tricks and agendas.

flaneur
Guest
flaneur
flaneur
Guest
flaneur

I agree with the comments above. Set a good and honest policy that everyone can abide.
Finland does not have Grandparents sponsorship program, yet no one is crying “R”.

VMD
Member
Mother of Wanting Qu, pop star girlfriend of Vancouver’s mayor, is arrested for corruption in China The mother of Wanting Qu, the pop star girlfriend of Vancouver Mayor Gregor Robertson, has been arrested for corruption in China, according to Chinese state media. A woman identified as Qu Zhang Mingjie, a Harbin city official, is currently in detention in Gu township, China Daily reported on Thursday. The official state-run newspaper reported that Qu Zhang Mingjie was a longtime bureau level cadre in Harbin, northeast Chinese. She was dismissed as deputy director of the city’s development and reform commission in September 2014, then in November was relieved of other duties related to the city’s urban construction and renewal activities, the report said. A spokesman for the Vancouver mayor’s office, Braeden Caley, told the South China Morning Post that the arrest was “not… Read more »
space889
Guest
space889
@Oracle – and they avoid any messy issues with taxes, residency requirements, etc.. It is also easier for the kid to get into univ here compared to China, and probably cheaper too relatively to the old investor programs. Cdn schools also get to make a big profit as well. So win win for everyone involved! Well except for the local students who are now collateral damage but then who cares about them when profit reign supreme right? If posters on here gets mad about supposedly influence of Chinese rich ruining the entire RE market for them right now, wait until your kids are ready to go to univ. If the current trend continues, you will be faced with an actual very real problem where it might actually be easier to send your kid to Harvard/MIT then get into UBC.
Oracle
Guest
Oracle

It’s all about international students now….parents in China just need to send their only son to school in a western country. Son gets PR, dad buys a home , mom gets supervisa. Dad becomes an astronaut. Why go through investor programs anymore??

flaneur
Guest
flaneur
“Australia will temporarily suspend all new applications to its Significant Investor Visa (SIV) migration service on April 24. The program requires an investment of AU$5 million (about 3.87 million U.S. dollars) and its suspension may be a heavy blow to Chinese hopefuls. The Department of Immigration and Border Protection of Australia has been reviewing its SIV program since 2014 and implemented changes to improve the visa scheme. The current SIV policy was popular among Chinese applicants, with low financial risks and a high success rate. Over 89 per cent of SIV’s approved applications came from China. The program will re-open on July 1 with the introduction of several new policies. It will henceforth prohibit direct investment into real estate as a pathway to citizenship. The new guidelines also make more detailed requirements in terms of investment. These include a mandatory… Read more »
cure4shripnoodle
Guest
cure4shripnoodle
pan de lund
Guest
pan de lund
space889
Guest
space889

@Softy – If you don’t allow foreign investments in Canada then chances are you also can’t own/invest in foreign countries either. It’s just like trade, you can’t only export but don’t allow imports.

Canadians owns plenty of foreign RE as well, it’s just that most of them are rich, just like the foreign owners here. Same goes for stocks, bonds, etc.

The boomers are being bailed out by foreign investments in houses and small biz right now. The poor & middle class and the young get shafted. But then again, our rich are probably doing the same thing in other countries and shafting their young, poor & middle class. This is just way things are, gov’t here are funded by the rich, voted in by the boomers, and that’s who they are going to serve.

space889
Guest
space889

@elvince – if the person is single, $2K/month net is perfectly doable. Plenty of people live on less than that, net or gross.

Now if you kids, non-working spouse, or elderly to take care of, or have certain lifestyle standards then yeah, it’s going to be hard.

space889
Guest
space889

@Bear Vancouverite – That might be true but if you look at the general statistics, the majority of the benefits go to the ones who least need them and it’s going to cost the treasury a nice chunk of changes. So from a social policy point of view, this is not a good policy, even if it makes sense.

space889
Guest
space889

@Mortgageslave – You know what’s even funnier? I don’t recall ever saying I hate him. Seems it is most of the bears on this blog who hates him more than the bulls.

Care to point to any posting where I said I hated him?

And let’s not confuse central bank pumped asset bubble with your investment prowness/acumen. They are quite different.

Softy
Guest
Softy

Four about three decades Canadians have been brainwashed into unquestioningly supporting foreign investment in our economy. This is the result. People who own the assets sell at high prices (higher than would be the case if the market for the assets was only local) and get rich. The rest get further and further away from asset ownership.

So what we have here is entire blocks of residential homes being taken off the market for years, without any confirmation that they’ll ever be replaced by more housing for Vancouver residents.

Joe Mainlander
Guest
Joe Mainlander

We’re averaging 17k new housing starts last decade while our population is growing 15k households a year.

Condos have been overbuilt relative to pop growth, so of their’s no rush to build them.

This housing bubble is not the result of lack of supply, empty condos, lack of land, or strips of housing along a few arterials being held back.

Those things don’t cause asset class inflation.

Joe Mainlander
Guest
Joe Mainlander

@#30 True.

vangrl
Member
vangrl

“The sale had some observers balking, off-the-record, at the risk and level of speculation involved, but Yu brushed aside these concerns, saying some buyers — especially those with offshore money — might operate with longer time frames and different expectations on return.

“It was one owner who bought the whole site and he is in no rush to act until the city supports his plan to do something he wants,” said Yu. “He’s a long-term holder. It’s just that he has the money and can hold it and liked the location and the deep size of the westside lot there.”

So what we have here is entire blocks of residential homes being taken off the market for years, without any confirmation that they’ll ever be replaced by more housing for Vancouver residents.

I

vangrl
Member
vangrl

and another article regarding land parcels just posted

http://www.vancouversun.com/business/Density+drives+Vancouver+land+assembly+gold+rush/10995841/story.html

“At the moment, Yu said she has some seven packages “already tied up,” meaning they are under contract as buyers apply for re-zoning, a process that can take one or two years.

During that period, all sorts of hiccups can trip up a deal. “Some owners, all of a sudden, change their minds and they will call me individually to back out,” said Yu.”

Softy
Guest
Softy
It’s not the homeowners who fail to realize. It is the buyers who pay too-high prices to the homeowners that fail to realize that the City takes a chunk of the land lift form re-zoning. Homeowners just want the money. They don’t care of about the profitability of the development project. What these homeowners fail to realize is that the City takes the ‘land lift’ from rezoning in DCC’s and other contributions. Developers make their profit from construction, not from the uplift through rezoning. Same thing happened on the Cambie Corridor. Previous head planner Brent Toderian even warned those homeowners; “House values skyrocket in Vancouver’s Cambie corridor” http://www.cbc.ca/news/canada/british-columbia/house-values-skyrocket-in-vancouver-s-cambie-corridor-1.1102601 “He says the final prices didn’t appear to have factored in community amenity contributions the city negotiates with developers in order to pay for infrastructure and services associated with increased density “People… Read more »
vangrl
Member
vangrl

#25

Jackson says he is aware of Yu’s land assemblies but says she cannot offer any assurance the land being offered will be rezoned, now or in the future, given that some developers are banking land in hope of policy changes by the city.”

I found this part interesting. I assumed that if an entire block of houses was brought to market that the rezoning would have already been figured out, hence the high asking price.

Thanks for explaining it further in post #25

elvince
Guest
elvince
@Slagathor #21: Wheter you should contribute to rrsp or tsfa first depends on a lot of factors (mostly on your current tax rate and future tax rate), but my example was someone who would contribute the maximum to both. In that case, you substract RRSP contributions from gross, then substract income taxes from what’s left (taxable), then you substract TFSA contribution from net income. If you make 60k$, you contribute: 10.8k$ in RRSP (taxable = 49.2k$) 14.8k$ to taxes (let’s suppose 30% average rate, net income = 34.4k$) 10k$ to TSFA Then you have a nice sum of 24.4k$ to put a roof over your head and food in your stomach. That will probably not cover a crappy apartment, public transit to get to work and 3 meals a day. Let alone a basic car, a 6-pack once in a… Read more »
w
Guest
w

Vancouver property exclusively marketed to international buyers; sells for $5 million over asking price

http://globalnews.ca/news/1955669/vancouver-property-exclusively-marketed-to-international-buyers-sells-for-5-million-over-asking-price/

Bear Vancouverite
Guest
Bear Vancouverite

Re: new TFSA limit. Won’t this benefit all bears or anyone who doesn’t buy an overpriced home? Anyone saving for a downpayment should be rejoicing. I also consider the TFSA as a very good counter to the “primary residence is exempt from capital gains” argument put forward by anyone who says real estate is always the superior investment. It might also encourage people to consider more carefully between the benefits of overstretching to own vs having enough to save.

Bear Vancouverite
Guest
Bear Vancouverite
@vangrl – I have some familiarity with the process. Realtors are trying to convince entire blocks to hold out for certain values per lot, but those values have no bearing on the realities faced by developers. Developers have to factor in the cost of construction and the total square footage they can build on the land (based on FSR). Areas like the Cambie Corridor are not being rezoned to huge FSR, they are being rezoned to medium density (eg mix of townhouses + lowrise). That’s why one block in the Cambie Corridor is actually going to be split into half townhouses and half low rise, the FSR won’t allow any more density. The experienced developers have well designed models that tell them exactly how much they can buy an assembly for depending on the final expected per square footage sale… Read more »
Mortgageslave
Member
Mortgageslave

@space889 – Funny that for somebody who hates garth so much you obviously read his blog daily. It’s obvious that your bitter for not following his advise. That and not many Agents like you like him. He’s made people like me and Vangirl who sold our condos years ago and invested in diversified portfolios very happy.

But for the most part I just skip passed all your comments if they haven’t already been voted down because you’re a complete F’in idiot.