Before buying real estate, create a bare trust

You know what the difference between you and the wealthy is?

The wealthy have lots of money.

And they tend to keep hold of it by using perfectly legal techniques such as buying and selling real estate within a bare trust to avoid taxes. One recent example prevented more than $2 million from from being vacuumed up into government coffers.

Green Party MLA Andrew Weaver has been concerned about the bare trust for the last two years, highlighting the need to fix the loophole.

He says people who are very wealthy or investing from abroad would be recommended by astute accountants to purchase their house using the loophole.

“Every time most people buy and sell a house, they’re paying property transfer tax. It’s only the wealthy and the wise who would actually buy in bare trust,” said Weaver.

“As a society, if every single person created a bare trust and bought every property in a bare trust there would be no more property transfer tax collected in British Columbia… there’s no reason not to change it.”

Just think of the efficiencies and tax dollars saved if every real estate transaction in BC happened through a bare trust. Less money spent in taxes means more money flowing into a supporting a healthy local economy. Bare trusts for all!

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patriotz
Member

Using a bare trust to save on PTT is only advantageous if the property is used for commercial purposes, including flipping. Both the property tax and income tax systems are heavily biased toward personal residence ownership, which is why most rich people have their houses in their own names.

The bare trust scheme had its origins in California after Proposition 13 was passed decades ago. In that state property taxation is based on purchase price not market value assessment. Thus a property can continue to pay property tax based on its 1970’s price, which makes a very big difference in the long run. But again US tax laws favouring home ownership really make attractive only for commercial properties.

Hyper-mega-Bull
Member
Hyper-mega-Bull

blah, blah, blah.

when are prices going to revert to the mean patriotz? still think HAM only active in the “high-end”?

ostritch
Member
ostritch

God bless you Bull. Coach house in Cambie area sells for 1.6M. But I’m lying, right bears? Or maybe I’m areal estate agent with an agenda. Or maybe coach houses in trusts only sell for top dollar. In Ottawa.

vangrl
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vangrl

A personal trust can hold property within it as a principal residence & all the Cap free gains that accompany that.

southseacompany
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southseacompany

“CMHC says many major housing markets showing signs of overvaluation”, CBC News

http://www.cbc.ca/news/business/cmhc-housing-vancouver-toronto-prices-1.3555680

“Canada’s national housing agency says nine of Canada’s 15 largest housing markets are showing signs of being overvalued.”

“On the overvaluation front, the CMHC says there is moderate or strong evidence of that happening in Vancouver, Edmonton, Calgary, Saskatoon, Regina, Hamilton, Toronto, Montreal and Quebec City.”

ostritch
Member
ostritch

Ya think? Whatchya gonna do Willis?

southseacompany
Member
southseacompany

“Federal Reserve leaves key interest rate target unchanged”, CBC News

http://www.cbc.ca/news/business/federal-reserve-interest-rate-1.3555474

“Economists say Fed leaves door open to possible June rate increase”

paulb
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fosolo1
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fosolo1

Why people buy in this screwed up market of bidding wars and vastly overpriced listings is beyond me.. It does looks like we in the topping phase now. The market is starting to careen.
This listing in my area was on the market for about 3 weeks at $1488000 . http://www.rew.ca/properties/R2054943/14528-18-avenue-surrey (cached)

Couldn’t sell so they dropped the price $290K and re-listed today for $1,198,000 under MLS# 2062699 . It’s still a ridiculous price.

Bear Vancouverite
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Bear Vancouverite

Please keep us updated on this property’s pricing. Might be interesting to see if they continue having to drop the price.

Shut It Down Already
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Shut It Down Already

It’s obvious why they’re buying – fear and/or greed.

Newcomer
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Newcomer

That is indeed @#$%& ridiculous. That’s an ugly house in the middle of nowhere. You could have a tear down in east van for the price.

bullwhip29
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bullwhip29

1.488M was just a fantasy price set by someone who is getting caught up in all this idiocy. only things people really going apeshit crazy about are prime building lots and over the top palaces like we see in pt grey. this stuff that people are trying to pass off as luxurious (and is priced too high to simply knock down) is not as desirable as many believe

ostritch
Member
ostritch

Why doesn’t the government take BC taxpayers on a Virtual Yellow Helicopter Tour of China’s Tier 1 cities. Let us see price per square foot etc so we can see where this elevator is going? Then they can take us back to the ground floor to take a look at the rest of the elements of their society like healthcare, social housing and the rest of the social safety net. Seeing as I am being dragged there without a choice, I’d like a bit of an advance look.

queue2
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queue2

All mention of Panama Papers banned from Chinese websites

Chinese news groups have been ordered to purge all mention of the Panama Papers from their websites and warned of harsh punishment if they are found to have published material “attacking China”.

http://www.theguardian.com/news/2016/apr/05/all-mention-of-panama-papers-banned-from-chinese-websites

I guess that this link won’t work in China either

Shut It Down Already
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Shut It Down Already

Remember when this was a blog about real estate?

queue2
Guest
queue2

@ Shut It Down
…..my apologies….I’ll keep on topic….

Panama Papers: How China’s wealth is sneaked abroad

So why does it matter if China’s richest people move their wealth out of the country?
Once money leaves China, it has to go somewhere.
This massive flow of money is driving up real estate prices worldwide. According to juwai.com, a real estate website that connects mainland Chinese clients with foreign sellers, Chinese buyers spent more than $52bn on foreign property last year.

http://www.bbc.com/news/world-asia-china-35957228

Shut It Down Already
Guest
Shut It Down Already

Of that $52bn the US says they’re getting $28bn, and Australia’s says they’re seeing $18bn of it. What’s that leave for all other countries including Canada?

http://www.24news.ca/the-news/economic-news/216262-chinese-investment-in-canadian-real-estate-set-to-increase-in-2016

Also note how juwai likes to report in terms of dollar value of “inquiries” or “searches” – not “sales”.

Saul
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Saul

Shit it down already and his dicking business… How boring is that?

queue2
Guest
queue2

Panama Papers and real estate are linked…but Shut It Down Already is still trying to keep up….

Shut It Down Already
Guest
Shut It Down Already

I do love a good conspiracy theory. The Panana Papers probably have as close to zero impact on Vancouver RE as you can get. It’s the greedy greedy locals who need a stern talking to. Don’t let me stop you from going out and “occupying” something, though.

queue2
Guest
queue2

DON’T TALK TO ME, SHUT IT DOWN ALREADY……FOR A “CONSPIRACY THEORY” AS YOU PUT IT, THE CHINESE GOVT IS THE ONE WHO APPEARS TO TAKING IT ALL QUITE SERIOUSLY.

Shut It Down Already
Guest
Shut It Down Already

They censor everything. What’s new? I imagine it’s more to do with potential embarrassment of some high-ranking resident government officials than anything to do with international real estate. But when you’ve decided that everything is about Vancouver house prices then I guess it’s hard to see anything else.

StupidityCheck
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StupidityCheck

Obnoxious troll thinks blog is off topic? Most amusing.

ChinaOne Swallows Dicks
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ChinaOne Swallows Dicks

Hey China, take a long hard suck on my arse.

patriotz
Member

Christy Clark received $277,000 since 2011 from B.C. Liberals

B.C. Premier Christy Clark has collected more than $277,000 from the provincial Liberal Party since 2011 to top up her government salary, the party disclosed Wednesday.

In addition to her $195,000 salary as Premier, Ms. Clark has received an escalating annual amount from the Liberals – $50,000 for 2015 and this year.

bullwhip29
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bullwhip29

surely, she is not going about things in this fashion simply for an extra $50k. when all is said and done (and she has re-entered the private sector) she will wind up with many tens of millions in her pocket

bullwhip29
Guest
bullwhip29

China police hunt for wealth manager who vanished with $154 million: Xinhua
http://www.reuters.com/article/us-china-wealthmanagement-wangzhou-idUSKCN0XM07Q

>>>hmm, i wonder where he went? maybe he is shacking up with Ching Mo Yeung in richmond? maybe krusty made special arrangements to have him picked up in her private jet? this said, $154M doesnt go as far as it used to in this town…

bullwhip29
Guest
bullwhip29

RE: What CMHC says about every major housing market in Canada
http://www.theglobeandmail.com/report-on-business/top-business-stories/frothy-and-flat-what-cmhc-says-about-every-major-housing-market/article29781590/

>>> this is same routine the ratings agencies pulled in the US prior to last meltdown

ostritch
Member
ostritch

I detect a strong amount of evidence that the CMHC is being obscure with its problematic data analysis. A deterioration of CMHC salaries seem to be in order. There is less evidence supporting the notion that they are in control of what they do as there is some evidence that they insure mortgages to foreigners who put 35% down.

Newcomer
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Newcomer
Hyper-mega-Bull
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Hyper-mega-Bull
MLS watch
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MLS watch
Hyper-mega-Bull
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Hyper-mega-Bull

Men on Craigslist offering Vancouver women free rent in exchange for sex

http://www.theprovince.com/touch/story.html?id=11883573

franko
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franko

Bloomberg:
“Stocks plunge from Tokyo to New York as central banks showed little will to step up support for flagging economies”

One more excuse for the FED to raise rates in June?
Should be interesting how RE will react to higher rates with “flagging economies”.

8888888
Guest
8888888

Don’t worry they’ll start counterfeiting again by next week.No recessions ever again , Sooner or later a dollar won’t be worth enough to wipe your ass with,

ostritch
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ostritch

Except that there is no inflation.

8888888
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8888888

Inflation figures are a joke.

ostritch
Member
ostritch

Ain’t it China’s flagging economy that’s causing half the ruckus in our housing market here?

Best place on meth
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Best place on meth

Yes, the corruption crackdown and yuan devalutation has sent a flood of money into Vancouver real estate.

patriotz
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Tax-cheat crackdown nets nearly three times expected total, CRA data shows

Note this was under Harper. Our new revenue hungry and civil servant friendly government will likely aim for more.

paulb
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southseacompany
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southseacompany

“President Donald Trump Would Destroy The Bond Market”, Forbes

http://www.forbes.com/sites/jareddillian/2016/04/28/president-donald-trump-would-destroy-the-bond-market/#98a1b1856870

“I can tell you that the stress on the bond market would be unbelievable. Triple the size of the treasury auctions and see what happens—interest rates will inevitably rise, and rise fast.”

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