One could also make a case for the home owner who's griping over his 500$ extra bill, that the fine stewards of local government are getting a little lavish in some of their projects. Does the new recreation center need to look like it was designed for Star Fleet command? And this is apparently the "pared back" version.... jebus.
Posted by: XXX_er
In Vangroovy you could be in for a huge tax bill even on a small house in Dunbar or point grey cuz of the market value some seniors can't pay it so they can defer taxes but I think you need to be 55+
Yah mayor Gordo the lush in cahoots w/his RE buddies did this to the seniors in Kerrisdale. Fucker.
Posted by: Couch_Surfer
Now, if you’re wanting property tax to act as a form of wealth tax, I’d suggest that’s a different topic and we’d have to look at total net worth (ALL assets and liabilities) and go at it holistically and in progressive structure. That’s still gonna screw over the fixed income pensioner living in a 3M$ tear down in Kits that she bought in 1965, but she can defer that tax payment, so probably all good.
I do think that the current form(s) of taxation lead to some unfair scenarios. Is a wealth tax the answer? Possibly, although that's a complicated issue. I definitely agree that if you were to implement a wealth tax then that would have to consider all assets/liabilities and not just real estate. I don't like how the current tax system focuses so much on "income" despite the fact that most people are getting rich in ways that don't get included in "income". For example, over the course of the pandemic both real estate and financial assets (stocks, bitcoin, etc.) have increased in value by a huge amount, but you can hold both of those and not pay any tax (assuming you don't sell the stocks). So lots of people have gotten much richer without having to pay any additional tax.
Regarding the fixed income pensioner example - Yes it's annoying to have expenses when you don't have a lot of cash coming in, but I don't have too much sympathy for people who are asset rich but cash poor. They at least have options. There are tons of people with no assets and no cashflow.
EDIT - Property tax specifically is a pretty small portion of the overall tax that people pay (in most cases). I just think in a place like Vancouver where you have lots of people making tons of $$ off their home with very little taxable income (i.e. from employment, etc.)... perhaps the tax system needs to be rejigged in a way that ensures people "pay their fair share" rather than having people in $5M houses receiving GST cheques (do those still exist?) and other low income benefits and then you have people on the other side of the spectrum renting a small apartment paying way more tax on their salary despite being much poorer than the homeowner.
Posted by: Bull_Dozer
The same people who own a detached house in Vancouver...?
I'd say most of the non speculators don't have a lot of spare cash left over after their mortgage payments and other living expenses. That's what it takes to get into the market. Work your ass off and save your money. The banks don't care if you live pay check to paycheck, I presume its better for them.
And I think you may be confusing "not very financially sophisticated" with "not comfortable leveraging the fuck out of my already ridiculous mortgage" Unless your sophistication can tell me how to withdraw cash from my home equity without it qualifying as debt.
Posted by: Couch_Surfer
Posted by: XXX_er
In Vangroovy you could be in for a huge tax bill even on a small house in Dunbar or point grey cuz of the market value some seniors can't pay it so they can defer taxes but I think you need to be 55+
if you own your property all that means is no mortgage or rent which is nice
Once I hit 55, I'm deferring all property tax bills based on your sage legal advice. They can pay for my share of this poop disposal lawsuit once I'm buried in the ground. LOL
I am not a tax lawyer but its just one possibility I have heard of in city of Van and possibly elsewhere ? There is a samll charge I and believe it amounts to a low interest loan so if you sell the house you gotta pay off the tax bill first
Posted by: MaxRockatansky
Posted by: Bull_Dozer
The same people who own a detached house in Vancouver...?
I'd say most of the non speculators don't have a lot of spare cash left over after their mortgage payments and other living expenses. That's what it takes to get into the market. Work your ass off and save your money. The banks don't care if you live pay check to paycheck, I presume its better for them.
And I think you may be confusing "not very financially sophisticated" with "not comfortable leveraging the fuck out of my already ridiculous mortgage" Unless your sophistication can tell me how to withdraw cash from my home equity without it qualifying as debt.
Exactly.
Posted by: XXX_er
Posted by: Couch_Surfer
Posted by: XXX_er
In Vangroovy you could be in for a huge tax bill even on a small house in Dunbar or point grey cuz of the market value some seniors can't pay it so they can defer taxes but I think you need to be 55+
if you own your property all that means is no mortgage or rent which is nice
Once I hit 55, I'm deferring all property tax bills based on your sage legal advice. They can pay for my share of this poop disposal lawsuit once I'm buried in the ground. LOL
I am not a tax lawyer but its just one possibility I have heard of in city of Van and possibly elsewhere ? There is a samll charge I and believe it amounts to a low interest loan so if you sell the house you gotta pay off the tax bill first
I’ve heard of it as well, no idea what the details are. I’m just being flippant on the ‘sage advice’ crack 👍👍👍
you can goggle it on the city of Vangroovy website for the details, which how i got what i know,
I know a couple of out door skier types who have done it facing a 30K tax bill in point grey & dunbar on houses that would be a tear down if they sold them
Posted by: MaxRockatansky
And I think you may be confusing "not very financially sophisticated" with "not comfortable leveraging the fuck out of my already ridiculous mortgage" Unless your sophistication can tell me how to withdraw cash from my home equity without it qualifying as debt.
https://www.investopedia.com/terms/s/smith-maneuver.asp
I have not done this, so can’t comment more with any insight.
Smith manoeuvre.
Ok, so the original scenario is that the asset went up 100K, and the asset holder is whining that they had to pay 500$ more for their property tax (I guess we’ll continue to ignore that the owner hasn’t crystallized that gain, and the DNV is building spaceports with their free money windfall).
So smith manoeuvre would have the home owner take that 100K gain out as a HELOC (adding debt), and then using the interest expense write-off on that debt to offset the 500$ tax required of them. 100K at 2.5 pts is 2500K, so you’d certainly offset the 500$ tax burden. Unless of course the 100K investment went in the wrong direction…. but that never happens right?
That seems like the city/dnv gets the opportunity to offload investment risk onto the home owner.
So here’s an idea. In return for these tax boosts, the home owner gets the opportunity to participate in the financing of the city’s mega-project. At a preferred and guaranteed rate of return (9% seem fair?), and backed by the city in case of failure. Home owner can then hand over the 500$ tax burden to the home owner, who then gets a low/no risk oppty to make 9pts on his asset appreciation that he can’t otherwise tap.
Mega projects always make 9 %, don't they?
The bank financing the project always gets paid.
LOL both houses have approx same listing price. One has ~2x Property tax bill. One city has industry besides Realtors, developers and speculators flipping houses to each other.
https://www.zillow.com/homedetails/1912-38th-Ave-E-Seattle-WA-98112/2112783023_zpid/ Property Taxes = $19,000+
https://www.realtor.ca/real-estate/23757965/4388-w-11th-avenue-vancouver Property Taxes = $10,500
Assessed value of Vangroovy house https://www.bcassessment.ca//Property/Info/RDAwMDBCQVpLNg== "Why work when my house gains $180k annually; tax free!" Every investor knows that $2mil for a 33'x122' lot is a good value.
"vAnCoUvEr Is A gLoBaL cItY" Heres a $3mil listing in suburb of STL Missouri with 2x Property Tax as above mentioned VanRE house. Again; hodling costs of Canadian Real Estate is comically low. Don't like that example heres another one . Go to Butt-Fuck Alabama for ~$3.5mil for $7500 property taxes.
Also; you're neighbours in North Van/Squampton with new wonder-fibre über-Enduro rig and special series Euro Lux brand vehicle likely bought it on credit.
Heads should roll when people who earn income through labour learn how much of what they pay in Income Tax goes towards subsidizing Millionaire Home Owners in Vancouver and Greater Toronto Area. Canada is about growing non-productive assets by any means possible (See former MP Adam Vaughan for reference) whilst taxing labour is one of the most regressive things we can do. Unfortunately we've spent decades electing the same two parties over and over to do just that. Luckily The Boomers who've benefited the most from such tax policy will have largely died off and not have to deal with the outcome. The rest of us will face massive shortages in skilled workers country wide.
Property Transfer Tax is there to keep Annual Property Tax rates low. Again certain demographic benefit from this much more than anyone else. Also the no capital gains on primary residence benefits that same group of peoples. And it's not difficult to game the system. People say housing is an investment yet is sure isn't taxed as such. Why are my meme stocks, NFTs and shit coins taxed as investment income; yet a person that gains $2mil in a decade thru housing is tax free on it?
Anyway, if you believe you're a Real Estate investing guru and not another victim of shitty government policy welp thats on you.
So what do you suggest? Since you clearly can observe how terrible all of these dirty scheming lazy homeowners are, who don't work for a living and just live from tax loophole to tax loophole, screwing over the working class, from your elevated perch of socioeconomic superiority?
In case the sarcasm is lost here, I think I speak for a lot of homeowners who own homes simply because they worked hard, set goals, and made sacrifices for something they felt was worthwhile long-term, when I say its annoying when people classify us as some type of silver-spoon/lottery winner/had everything handed to them/got in early /speculator/ tax evader or whatever in an attempt to discredit the notion that some people just figure it out however they can. Either do it or don't but whining won't solve it.
Our residential property taxes are are way too low and commercial property taxes too high - damage being done on both ends.
I'd be good with modifying or getting rid of the capital gains tax if mortgage interest was tax deductible.
Forum jump:
