Category Archives: hype

BC Speculation Tax Impact

People who own more than one home are worried about the new speculation tax:

From a Vancouver Island resident with a condo in Vancouver: “If the proposed speculation tax proceeds as you describe, the two-per-cent tax will far exceed the B.C. income tax that we normally pay. We will have no choice but to sell our Vancouver condo. We’re not speculators. We simply wanted to enjoy a few days a month in the city we used to live in, in the comfort of our own condo.”

On the problem for seniors with recreational properties that have been in the family for years: “If they pay zero income tax because their annual income is low enough to warrant no tax — i.e. married couple making around $25,000 or so — they’d never recover the amount.”

From someone with a place on Saturna: “They call it a speculation tax, but it seems more like an empty home tax. The government claims that taxing homes which remain empty most of the year will help deal with the housing shortage. If that is the case, why isn’t Whistler included? The prices are skyrocketing and there is a real housing shortage for workers. On the other hand, they include a Gulf Island like Saturna, where there isn’t a housing shortage and housing prices haven’t risen in more than eight years.”

On the perverse incentives of a tax vis-a-vis longtime residents versus actual speculators: “If you speculate and sell the property quickly, you pay the tax once, while those keeping property for years pay years of tax. The short-term speculators win!”

Read the full article here.

Houses being sold at a loss

Southseacompany points out this article claiming speculators are leaving the local market and selling homes purchased in the last two years for less than the purchase price:

Dozens of homes in Metro Vancouver bought in the last two years are currently listed to be sold for a loss as speculators appear to exit Canada’s hottest real estate market.

An industry insider sent ThinkPol sales data for single family houses in the Lower Mainland showing roughly 40 properties that are currently listed for prices lower than what the sellers originally paid for them.

As the property purchases were made within the last two years, ThinkPol was able to validate this data using information published by BC Assessment.

price read the full article here

BC: The Best Place to Launder Money

Looking to launder some money?

You’d be hard pressed to find a better place to do it than right here in beautiful British Columbia.

“One of the members of the public service said, ‘Get ready. I think we are going to blow your mind.’ While I cannot share all of the details, I can advise you that the briefing outlined for me allegations of serious, large-scale, transnational laundering of the proceeds of crime in British Columbia casinos,” Eby said. “And I was advised that the particular style of money laundering in B.C. related to B.C. casinos is being called, quote, ‘the Vancouver model’ in at least one international intelligence community.”

Eby suggested that a “lax attitude” towards regulation of B.C. casinos, during a period when the previous government had enjoyed “massive increases in provincial gambling revenue,” seems to have contributed to the problems today in B.C.’s gambling system.

Once you’ve had fun in our casinos come join the real fun in our property market where owners get to hide behind ‘opaque legal mechanisms’ for a place to stash cash that pays back!

Eby also said that he believes B.C.’s property ownership system — in which true owners of property can hide behind opaque legal mechanisms — could be attracting foreign criminals and corrupt officials seeking to hide wealth in the province. Eby said Finance Minister Carole James is working on reforms to pull back legal veils that cover true ownership of property and corporations.

Eby pointed to a 2016 study by Transparency International that showed real estate buyers in B.C. are using shell companies, trusts and nominee buyers to hide their beneficial interest in property.

In examining Vancouver’s 100 most valuable homes, the report found that 46 per cent — amounting to more than
 $1 billion in assets — have opaque ownership. Of the 100 properties, 29 are held through shell companies, at least 11 are owned through nominees (listed as students or housewives on land titles), and at least six are disclosed as being held in trust for anonymous beneficiaries, the report said.

Eby said B.C.’s landownership system could be connected to Metro Vancouver’s skyrocketing home prices. Top economists have “made inescapable arguments that taxable incomes reported to Revenue Canada have no connection to real estate values in Metro Vancouver until you get out to the distant suburbs of Vancouver,” Eby said.

This Eby guy sounds like a troublemaker. You know what to do, get out your wallet . With the right motivation we should be able to get this new government on the right side of history and keep the fun going in the casinos and the housing market. Right?

Read the full article here.

Vancouver condo presales, locals to get first crack

The Mayor is said to be drafting a motion that will give local buyers first chance to buy crack condos:

Mayor Gregor Robertson will introduce a motion to give local residents first crack at pre-sale condo sales Tuesday during a Vancouver city council meeting.

The motion asks city staff to draft a policy framework as part of the city’s “Housing Reset” plan.

Critics of the real estate industry have raised concerns about how the increasingly speculative pre-sale market is pushing up prices in both the pre-sale and resale market, and is preventing local residents from buying.

Presumably this will help to end the homeless problem in Vancouver by giving locals easier access to condo presales.

Read the full article here.

Mortgage rules are working to cool market

Pointed out by SouthSeaCompany: Mortgage rule changes are cooling housing market: Morneau

“Finance Minister Bill Morneau says last October’s sweeping mortgage rule changes aimed at cooling Canada’s housing market have successfully dampened high-risk borrowing.”

“But despite a report urging Ottawa to look at ways of boosting support for Canadians entering the housing market, the Minister ruled out any new measures along those lines, expressing concern that such an approach would encourage higher house prices.”

Read the full article over at the Globe and Mail.