BC Political Discussion: Election 2020 and Beyond

[mcj]

Originally Posted by Sheba

BC Budget 2024 has been released.

No big surprises on the capital spending portion as far as I can see. IVF treatment being covered is nice for prospective young families like mine.

[Migrant_Coconut]

BC wants all the families it can get - can't afford to be picky.

Let's just hope the new generation of nurses has ditched the obsession with natural births over C-sections (which is why my skull looks like Phobos).

[chowhou]

The 20% 2 year flipping tax above and beyond the existing federal flipping tax seems extremely excessive to me. Just another band-aid do-nothing tax that complicates everyone's lives but won't cause any meaningful change to property values.

[mcj]

Originally Posted by Migrant_Coconut

BC wants all the families it can get - can't afford to be picky.

Yeah seems like the average cost of IVF treatment is approx. $20k, even adjusting for inflation over the 18 years as those kids grow up, they'll pay that amount back in taxes on average quite quickly. Makes sense from an economic perspective, especially since they'll become adults as the boomers reach their 80s/90s and therefore incur the most expensive healthcare requirements we'll ever see from a demographic ratio perspective.

[idunno]

I disagree re: the flipping tax actually. It's amazing if you're following real estate transactions how many are flipping in under 12 months. This kind of activity may be suppressed somewhat in the current market, but it's really common in a more boomy market. Not to mention the constant flipping of assignments that puts any new build into the stratosphere ;l

[chowhou]

Originally Posted by idunno

I disagree re: the flipping tax actually. It's amazing if you're following real estate transactions how many are flipping in under 12 months. This kind of activity may be suppressed somewhat in the current market, but it's really common in a more boomy market. Not to mention the constant flipping of assignments that puts any new build into the stratosphere ;l

Bear in mind that flipping itself shouldn't really increase value, the flipper is just trying to capitalize on either short term market price increases that are out of their control or capital improvements which are clearly value-added. Constant flipping of a property over and over doesn't magically +50 the value every single time.

IMO flipping is a non issue because if a flipper is declaring PRE each time then no supply is lost, and if a flipper isn't then on each transaction the flipper is already getting hit with PTT, legal fees, and if there is a gain then it's capital gains (or income tax if it's under a year due to the federal flipping tax).

I wish the BCNDP would use its time in government to enact more supply easing policies instead of these tiny token feel good attempts at demand reduction.

[whatnext]

Originally Posted by chowhou

Bear in mind that flipping itself shouldn't really increase value, the flipper is just trying to capitalize on either short term market price increases that are out of their control or capital improvements which are clearly value-added. Constant flipping of a property over and over doesn't magically +50 the value every single time.

IMO flipping is a non issue because if a flipper is declaring PRE each time then no supply is lost, and if a flipper isn't then on each transaction the flipper is already getting hit with PTT, legal fees, and if there is a gain then it's capital gains (or income tax if it's under a year due to the federal flipping tax).

How much is a flipper adding when they rip out the brown cabinets and flooring from 15 years ago to add the de rigeur sterile all-white cabinets and flooring? Lots of buyers would be just as happy with cheaper housing that isn't decorated in the latest fad.

[chowhou]

Originally Posted by whatnext

How much is a flipper adding when they rip out the brown cabinets and flooring from 15 years ago to add the de rigeur sterile all-white cabinets and flooring? Lots of buyers would be just as happy with cheaper housing that isn't decorated in the latest fad.

Clearly they're adding value, otherwise the value of the property would not increase in response. If buyers value new white cabinets over 90s wood cabinets, then that's what the market demands. I don't really see that as an evil that must be stopped.

[whatnext]

Originally Posted by chowhou

Clearly they're adding value, otherwise the value of the property would not increase in response. If buyers value new white cabinets over 90s wood cabinets, then that's what the market demands. I don't really see that as an evil that must be stopped.

It all drives up home prices. Before the HGTV mindset took hold buyers were quite happy to buy dated homes and renovate them as budget and time allowed.

PS For those looking for a deal downtown, I'd suggest picking up this reno gone wrong: https://www.rew.ca/properties/5618249/303-1972-robson-street-vancouver-bc?property_click=map

[chowhou]

Originally Posted by whatnext

It all drives up home prices. Before the HGTV mindset took hold buyers were quite happy to buy dated homes and renovate them as budget and time allowed.

PS For those looking for a deal downtown, I'd suggest picking up this reno gone wrong: https://www.rew.ca/properties/5618249/303-1972-robson-street-vancouver-bc?property_click=map

Doing your own home renovations drives up home prices too, shouldn't we ban those as well? Same with gardening, and building schools, and crime prevention. Think of the increased property value! It must be stopped!

[whatnext]

Originally Posted by chowhou

Doing your own home renovations drives up home prices too, shouldn't we ban those as well? Same with gardening, and building schools, and crime prevention. Think of the increased property value! It must be stopped!

Perhaps but driving up the price isn't the sole intent as it is with a reno-flip.

That said, the proposed NDP legislation is really more political theatre than anything else.

[WarrenC12]

Originally Posted by Migrant_Coconut

BC wants all the families it can get - can't afford to be picky.

Let's just hope the new generation of nurses has ditched the obsession with natural births over C-sections (which is why my skull looks like Phobos).

You should have worn one of these:

[WarrenC12]

Originally Posted by mcj

Yeah seems like the average cost of IVF treatment is approx. $20k, even adjusting for inflation over the 18 years as those kids grow up, they'll pay that amount back in taxes on average quite quickly. Makes sense from an economic perspective, especially since they'll become adults as the boomers reach their 80s/90s and therefore incur the most expensive healthcare requirements we'll ever see from a demographic ratio perspective.

It's expensive but most provinces already cover it. So BC is just catching up with the rest of the country.

[WarrenC12]

Originally Posted by idunno

I disagree re: the flipping tax actually. It's amazing if you're following real estate transactions how many are flipping in under 12 months. This kind of activity may be suppressed somewhat in the current market, but it's really common in a more boomy market. Not to mention the constant flipping of assignments that puts any new build into the stratosphere ;l

Counterpoint: These people are already paying capital gains taxes. We arguably need their investment money to keep funding pre-construction projects.

[Changing City]

Originally Posted by WarrenC12

Counterpoint: These people are already paying capital gains taxes. We arguably need their investment money to keep funding pre-construction projects.

Not many projects take under 2 years from initial sales to completion, so on new development projects it would only affect an investor buying and then selling again before two years pass (as an assignment). It's also only 20% of any profit made by flipping the property (although there's also a federal flipping tax), so it might put some investor flippers off, but they shouldn't be out of pocket.

[whatnext]

Worth noting this is the province's largest ever deficit, on top of the NDP projecting to triple the overall debt after 10 years in office:

...This lukewarm budget is already drowning in red ink. It has not only the largest deficit in B.C. history, at $7.9 billion, but also the largest debt levels British Columbia has ever seen. The NDP is forecasting to drive taxpayer-supported debt to $126 billion by 2027, a tripling of what it inherited upon taking power in 2017....

https://www.biv.com/news/commentary/rob-...ced-timidity-in-latest-bc-budget-8347259

[djmk]

Originally Posted by WarrenC12

Counterpoint: These people are already paying capital gains taxes. We arguably need their investment money to keep funding pre-construction projects.

actually, flipping is full income now. No longer capital gains.

[djmk]

Personally, I see these "flippers" as just another way of financing these huge projects. Even the banks require a certain % of units presold to get construction loans. Someone willing to put money down today and wait 5 years is not the same type of person that needs housing now.

[djmk]

Originally Posted by mcj

IVF treatment being covered is nice for prospective young families like mine.

IVF is making big news in the US right now because of Alabama. Pretty wild the differences between here and there.

here - we need this, this is a right and the state will pay for it
there - this is murder.

So wild

[WarrenC12]

Originally Posted by djmk

Personally, I see these "flippers" as just another way of financing these huge projects. Even the banks require a certain % of units presold to get construction loans. Someone willing to put money down today and wait 5 years is not the same type of person that needs housing now.

Yes and it helps increase the number of net new units that get built, regardless of who lives in them.