Is Real Estate "investment" not speculating??

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Re: Is Real Estate "investment" not speculating??

Postby fz6adventure » Mar 13th, 2018, 2:43 pm

Sparki55 wrote:
It may come as a surprise to you that not all these people are millionaires. Some are just average working folk in Alberta with a $250K condo here for summer use and an investment. A 5% tax on that is $12,500 a year and when the tax is 20% it will be $50,000. So what if it sits empty; in 20 years it will be worth $400,000, a great investment.


My typo was corrected in an earlier post. The Speculation Tax is 0.5% in 2018 and 2% in 2019 so that makes the burden $1,250 in 2018 and $5,000 in 2019. Really not too severe for someone avoiding BC income tax. You could even call it an investment cost of doing business.

But you hit the nail on the head when you stated it would be an investment - exactly what drives the price of real estate and exactly the purpose of the tax. They would be better off paying a stockbroker if they want investments. Sell and come to our fair location, we have lots and lots of hotel space that averages 63.8% occupancy.

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Re: Is Real Estate "investment" not speculating??

Postby kgcayenne » Mar 13th, 2018, 2:46 pm

Sparki55 wrote:It may come as a surprise to you that not all these people are millionaires. Some are just average working folk in Alberta with a $250K condo here for summer use and an investment. A 5% tax on that is $12,500 a year and when the tax is 20% it will be $50,000. So what if it sits empty; in 20 years it will be worth $400,000, a great investment.


:135:
https://www2.gov.bc.ca/assets/gov/taxes ... on-tax.pdf
In 2018, the tax rate will be $5 per $1,000 of assessed value. In 2019, the rate will increase to $20 per $1,000 of assessed value.


2018 Rate:
$250,000 empty condo
$250,000/$1000 = 250
250 x $5 = $1,250

2019 Rate:
250 x $20 = $5,000
(if that condo remains at an assessed value of $250,000)
"without knowledge, he multiplies mere words."
Insanity is hereditary, you get it from your kids.

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Re: Is Real Estate "investment" not speculating??

Postby fz6adventure » Mar 13th, 2018, 3:07 pm

Sparki55 wrote:It's not a fair tax, to defend and justify it by saying "poor millionaires" exposes your lack of knowledge with real estate and investments. I'm thankful to live in a capitalist society where hard work pays off and supply & demand dictate prices. Our free society also gives rights to be able to do what you wish with your money like buying a home in Kelowna or Nunavut; Kelowna is the popular choice over Nunavut due to nice weather, ample recreational activities and good services and therefore costs more and now our government is says "don't invest here, it's not fair you can have a vacation property and others cannot afford it". Sounds very controlling to me, not something I want to government to be apart of.


Yeah I guess I'm not that savvy with real estate and investments. Silly me, I should realize that real estate is guaranteed to go up well past the inflation rate or interest rate and never hit a bump in the road. Were you around in 2008?

Like magic, I see the housing crunch is going to disappear very soon and sanity will prevail. The reason may have nothing to do with the Speculation Tax?

This from December 15th 2017:

He doesn’t know exactly when it will happen, but Helmut Pastrick says there’s a very good chance the Central Okanagan housing market will end its considerable climb with a sizable crash.

Speaking to members of the Kelowna Chamber of Commerce Dec. 15, the chief economist for Central 1 Credit Union said there was a 70 per cent chance a recession will send the region’s housing market into freefall.

“This is still the number one way I think this cycle will end,” he said.

He said housing is one of the first sectors to suffer when economies take a hit, and when that happens sales can plummet 30, 40, or even 50 per cent.

The corresponding hit to house prices will depend on how much they rose in the preceding upswing, but Pastrick said it will likely mean a 20-30 per cent price drop in the Central Okanagan.
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Re: Is Real Estate "investment" not speculating??

Postby Bikes » Mar 13th, 2018, 6:30 pm

this whole thread is between jealous broke people and people who have earned their stuff.
the left right paradigm is alive and well in canuckistan!
loser socialists against determined capitalists....
remember this you lefties...without some one doing the work...it doesn't get done. with out profit why would anyone put in the effort? since the lefties don't pay much tax on average or actually produce anything, where do you think the money for bc's infrastructure came from? the left? nope...it came from hard working right wing conservatives that built this province.
the left has 'cut off your nose to spite your face' logic.....
all i see is jealousy and no salient arguments from the losers with no assets.
if you have never been a success in your life...why do you think that you should dispense your ideas on how to be a success?
what a confounding lot of losers who are going to force out the drivers of the economy... the ndp destroyed bc before and they are doing it again....
do you know the definition of a broker?...some one who is broker than their clients.....
we need to bring back the law that if you don't pay taxes you can't vote!
no municipal tax...no municipal vote
no provincial tax then no provincial vote.
no federal tax then no federal vote.
losers have too much say in where we steer the economy....
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Re: Is Real Estate "investment" not speculating??

Postby vegas1500 » Mar 13th, 2018, 7:35 pm

fz6adventure wrote:
vegas1500 wrote:
Wrong....they will spend their money elsewhere, most likely south of the border. I know quite of few people affected and they will be selling and not spending a dime here.....and I know, no one cares because their rich...


Right ..... with at least a 20% exchange rate!


Yes, even with the exchange rate it’s cheaper to live. Is someone has owned a home/condo for let’s say the last 10-12 years (as I have). I can assure you I will never come and stay in a hotel as you suggested, neither will the people I know. They may rent off Air B and B and stay in a house...
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Re: Is Real Estate "investment" not speculating??

Postby Bpeep » Mar 13th, 2018, 10:04 pm

Aren't all investments speculation?
If you are reading this, you are not Amish.

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Re: Is Real Estate "investment" not speculating??

Postby Bikes » Mar 13th, 2018, 11:09 pm

Bman wrote:Aren't all investments speculation?


houses on the lake in Kelowna have doubled in value every seven consistently for over forty years... still speculation but definitely one of the best investments ever.... now that they are over the million dollar mark they are even a better investment.....!
invest 500,000 as a down payment lease it out to a corporation for their clients and in 7 years as per the median and turn it into 2.5 million plus your original 500,000.....500% in 7 years .......I LOVE IT!
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Re: Is Real Estate "investment" not speculating??

Postby fz6adventure » Mar 14th, 2018, 7:12 am

Bikes wrote:this whole thread is between jealous broke people and people who have earned their stuff.
the left right paradigm is alive and well in canuckistan!
loser socialists against determined capitalists....
remember this you lefties...without some one doing the work...it doesn't get done. with out profit why would anyone put in the effort? since the lefties don't pay much tax on average or actually produce anything, where do you think the money for bc's infrastructure came from? the left? nope...it came from hard working right wing conservatives that built this province.
the left has 'cut off your nose to spite your face' logic.....
all i see is jealousy and no salient arguments from the losers with no assets.
if you have never been a success in your life...why do you think that you should dispense your ideas on how to be a success?
what a confounding lot of losers who are going to force out the drivers of the economy... the ndp destroyed bc before and they are doing it again....
do you know the definition of a broker?...some one who is broker than their clients.....
we need to bring back the law that if you don't pay taxes you can't vote!
no municipal tax...no municipal vote
no provincial tax then no provincial vote.
no federal tax then no federal vote.
losers have too much say in where we steer the economy....


Wow! That's an angry rant. I guess it depends on how one characterizes winners and losers - I can see your characterization is all about who has the most money. So if a winner all of a sudden loses money they become a ...."loser". Don't be so hard on yourself if all of a sudden you lose money!
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Re: Is Real Estate "investment" not speculating??

Postby fz6adventure » Mar 14th, 2018, 7:15 am

Bikes wrote:
Bman wrote:Aren't all investments speculation?


houses on the lake in Kelowna have doubled in value every seven consistently for over forty years... still speculation but definitely one of the best investments ever.... now that they are over the million dollar mark they are even a better investment.....!
invest 500,000 as a down payment lease it out to a corporation for their clients and in 7 years as per the median and turn it into 2.5 million plus your original 500,000.....500% in 7 years .......I LOVE IT!


Did that formula work from 2001 to 2008?
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Re: Is Real Estate "investment" not speculating??

Postby W105 » Mar 14th, 2018, 7:43 am

talk about mixing up facts and fear mongering..

this is what Jim Zaffino (CAO of West Kelowna) said..


He predicts owners who are asset rich but cash poor may have to sell their second homes, some at a loss, when the tax adds as $20,000 to the cost of owning a $1 million home second home.

Those that stay will have to raise the rent they charge students during the times they aren’t staying in the property in an attempt to recoup the tax.

apparently he didn't read the part that if you rent out your second property you will NOT be subject to paying this tax...but according to him those that have a second property and are renting them will now have to raise the rent to cover the tax ??

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Re: Is Real Estate "investment" not speculating??

Postby fz6adventure » Mar 14th, 2018, 7:56 am

W105 wrote:talk about mixing up facts and fear mongering..

this is what Jim Zaffino (CAO of West Kelowna) said..


He predicts owners who are asset rich but cash poor may have to sell their second homes, some at a loss, when the tax adds as $20,000 to the cost of owning a $1 million home second home.

Those that stay will have to raise the rent they charge students during the times they aren’t staying in the property in an attempt to recoup the tax.

apparently he didn't read the part that if you rent out your second property you will NOT be subject to paying this tax...but according to him those that have a second property and are renting them will now have to raise the rent to cover the tax ??



Precisely! Nice when senior staff paid for by taxation tout mis-information to attempt to swing public opinion. Credibility is important - now he has none. Fortunately there are far more people that will benefit from the Speculation Tax than others.

I have a pretty tough time feeling sorry for gamblers someone who put themselves in a position of being asset rich and cash poor on a $1 million dollar investment. Still, if they decide to sell off, they are not likely to lose money - the real estate industry will clean up though on the re-sales. If the houses are that good they won't sit empty.

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Re: Is Real Estate "investment" not speculating??

Postby kgcayenne » Mar 14th, 2018, 8:22 am

People who work, live in, and contribute to a community are just as incensed at subsidizing the opulent empty-home owners as the opulent are at their taxes (that were figuratively pried from their atrophied knurled digits) going to publicly-funded social programs.

No one held a gun to their heads and told them that having a $1M second home was a necessity or a fundamental human right.

People in today's world let themselves get all tied-up in fiscal ligatures; they lack the liquidity to address changes. This. This shows that the certain wealthy persons are no smarter than the average person, and have decided the only way they can feel successful is if everyone else can see/touch what they have. Very base, very shallow.

Truly wealthy and socially-prudent people are going to quietly pay the tax, they know the score.
"without knowledge, he multiplies mere words."
Insanity is hereditary, you get it from your kids.

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Re: Is Real Estate "investment" not speculating??

Postby W105 » Mar 14th, 2018, 8:43 am

We are at a point where those in the market already are realizing massive gains while those not in the market, be it because of age, employment, or otherwise are suffering large losses in the form of increasing rent, and increasing difficulty to enter the market...


This tax deals with the philosophical problem of what should people be allowed to do with a limited resource that every individual requires in some form.
Is it incompletely thought out? Definitely. Will it have unintended consequences? Absolutely. Is it a step in a direction that is trying to level the playing field? Yes... Are "Vacation Homes" something that is more important to protect than "Primary Residences"? I would say no...

More importantly is housing, being a human necessity, something that should be allowed to be used to create a massive benefit to some, increasingly at the expense and exclusion of others? I don't think so...

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Re: Is Real Estate "investment" not speculating??

Postby Terris » Mar 14th, 2018, 7:04 pm

Housing shouldn't be a market commodity when a certain percentage of the population can't even afford to rent a home to provide security of person.

None of us are born owning land or property, regardless of any familial or inherited social status.

We certainly won't own it when we're dead.

This can no longer be an us v. them issue. It isn't about jealousy.

We all have a right of fair access to housing and real estate should be considered a human right, enforced by government regulation.

The last time any affordable housing was built here was back in the 60's and 70's when several mobile home parks were built as well as the apartments built along Pandosy and a few in Rutland. Since then there have been very few rental units built.

To continue to allow individuals or corporate entities to speculate/invest and profit immensely and luxuriously while others suffer diminished life potential from lack of a secure home is most dishonorable and, I daresay, criminal.

Real estate investment now is just like how smoking was back in the day; addictive, with the "high" promise of million$.

Everyone's doing it to be cool, but just as with the hindsight we now have of smoking, I'm sure we can now all see the hazards to the greater populace which, at the end of the day, costs us all...

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Re: Is Real Estate "investment" not speculating??

Postby vegas1500 » Mar 14th, 2018, 7:59 pm

Terris wrote:Housing shouldn't be a market commodity when a certain percentage of the population can't even afford to rent a home to provide security of person.

None of us are born owning land or property, regardless of any familial or inherited social status.

We certainly won't own it when we're dead.

This can no longer be an us v. them issue. It isn't about jealousy.

We all have a right of fair access to housing and real estate should be considered a human right, enforced by government regulation.

The last time any affordable housing was built here was back in the 60's and 70's when several mobile home parks were built as well as the apartments built along Pandosy and a few in Rutland. Since then there have been very few rental units built.

To continue to allow individuals or corporate entities to speculate/invest and profit immensely and luxuriously while others suffer diminished life potential from lack of a secure home is most dishonorable and, I daresay, criminal.

Real estate investment now is just like how smoking was back in the day; addictive, with the "high" promise of million$.

Everyone's doing it to be cool, but just as with the hindsight we now have of smoking, I'm sure we can now all see the hazards to the greater populace which, at the end of the day, costs us all...



I agree there needs to be affordable housing. You are right, none of us are born owning land. But everyone has the same chance to work hard and buy whatever they want, even if it property or as many homes as they can afford...that’s whats great about our country. To say the ability to do so is criminal...is laughable. May as well move to A communist country.

People do it to enjoy their lives and to prosper...not sure why people have such a hard time with that, I assume its Jealousy.

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