Canada's 'housing bubble' deemed close to bursting

[casper]

Originally Posted by whatnext

A lot of people looking to rent in Vancouver would be happy to get what you describe, given the alternatives:

Photos: This tiny, windowless room is what $750 will rent you in downtown Vancouver

In comparison these laneway home are a lot nicer.

https://vancouver.craigslist.org/search/apa?query=laneway

[GenWhy?]

Originally Posted by casper

Terminology is also important.

In Vancouver, most of the single detached are on lots that allow for a legal secondary suite and a laneway house above the garage.

So in basically every single family residential lot allows for three households.

That said, they do need to expand what is allowed along major arterials.

And a duplex the same as Edmonton. I hate seeing that zoning map going around ignoring duplexes are allowed when comparing to other cities that also allow duplexes but it never shows up.

[O-tacular]

Originally Posted by goodgrowth

Funny the thing that stood out to me in those maps is actually industrial land(the gaps in the map). Calgary and especially Edmonton seem to have quite a bit more industrial land relative to Vancouver and the GTA.

Cutting down on "sprawl" in those cities might require just as much rethinking density for industrial areas as it does residential.

The amount of vacant mystery lots in the industrial areas of Calgary is staggering. Almost the entire Eastern flank of the city as well as everywhere around the airport is Industrial land.

Behold random wastes of space:

https://www.google.com/maps/@50.987163,-...itch%3D0%26thumbfov%3D100!7i16384!8i8192

https://www.google.com/maps/@50.9853966,...Da1eos_boRTCunSDhtMcw!2e0!7i16384!8i8192

https://www.google.com/maps/@50.9840677,...itch%3D0%26thumbfov%3D100!7i16384!8i8192

https://www.google.com/maps/@50.9803703,...EwyxZJADlcH8QySmgY7vQ!2e0!7i16384!8i8192

https://www.google.com/maps/@50.9746179,...itch%3D0%26thumbfov%3D100!7i16384!8i8192

[GenWhy?]

Originally Posted by lio45

Yes, obviously.

As casper points out, the mapmaker could easily have justified putting all of the yellow in Vancouver in green (zoned for triplexes).

I have the feeling the phenomenon is the same in Edmonton, but for some reason, the mapmaker is familiar with it in Edmonton but not in Vancouver...

Agreed. Vancouver and Edmonton have almost identical traditional "Single family" zoning that allow duplexes and secondary suites.

Vancouver standard zoning: https://bylaws.vancouver.ca/zoning/zoning-by-law-district-schedule-rs-1.pdf

Edmonton standard zoning: https://webdocs.edmonton.ca/zoningbylaw/bylaw_12800.asp?SearchFile=(RF1)

[WarrenC12]

Laneway homes are way better than basement suites for both renter and landlord.

[whatnext]

Hmm, well isn't that strange. Who can have imagined such a thing....

Tax agency obtains 'jeopardy order' for debt from Downton Abbey-loving billionaire
-Mingfei Zhao paid $11 million for iconic Vancouver mansion in same year he declared income of $9K

Jason Proctor · CBC News · Posted: Aug 17, 2022

Canada's tax agency has obtained an order to seize debts owed by a Chinese billionaire whose love of Downton Abbey inspired him to pay more than $11 million for an iconic Vancouver mansion in the same year he claimed income of just $9,424.

According to a federal court judgment issued last month, the Canada Revenue Agency sought the so-called "jeopardy order" to collect $770,710 against the future sale of Mingfei Zhao's home because the 64-year-old has left Canada and appears to be in the process of trying to sell the only asset he has left in this country.

The new 'Earl' of Shaughnessy breathes life into historic home
Zhao bought the 14,000-square foot Tudor-style property in 2014 to much fanfare, vowing to return the building to its original glory a century earlier when "the Rosemary" — named after the daughter of a liquor tycoon — was considered the grandest home ever built in Vancouver.

But according to the court documents, Zhao declared income of less than $10,000 in 2014 and $38,161 in 2015 — amounts CRA auditors concluded were "not sufficient" to support his purchase of real estate and monthly mortgage payments of $8,699.....

The court file includes more than 2,000 pages of documents detailing attempts to nail down Zhao's bank account balances, his unreported worldwide income and his whereabouts.

At one point, he also owned another multi-million dollar home as well as a Bentley, a Rolls Royce, a Mercedes and a Range Rover. But as of last June, he was only registered as the owner of the Rosemary and the Range Rover.

Last month, records showed Zhao no longer had a Canadian cellphone account.

In March, the CRA also claimed to have "uncovered" a Globe and Mail article from nearly two years earlier "in which it stated that Mr. Zhao no longer lived in Vancouver and that he had started a new family in Europe."...(bold mine)

https://www.cbc.ca/news/canada/british-columbia/mingfei-zhao-cra-jeopardy-1.6552742

[lio45]

At those income levels, the “Earl of Shaughnessy” receives quarterly GST/HST Credit checks.

Hilarious if it weren’t so stupid (and paid by us all).

(Not that I’m complaining too much about the stupidity; I have really low incomes compared to my wealth so I, like him, am among those benefiting from our idiotic taxation of productivity and un-taxation of wealth.)

[casper]

Originally Posted by whatnext

Hmm, well isn't that strange. Who can have imagined such a thing....

Tax agency obtains 'jeopardy order' for debt from Downton Abbey-loving billionaire
-Mingfei Zhao paid $11 million for iconic Vancouver mansion in same year he declared income of $9K

Jason Proctor · CBC News · Posted: Aug 17, 2022

Canada's tax agency has obtained an order to seize debts owed by a Chinese billionaire whose love of Downton Abbey inspired him to pay more than $11 million for an iconic Vancouver mansion in the same year he claimed income of just $9,424.

According to a federal court judgment issued last month, the Canada Revenue Agency sought the so-called "jeopardy order" to collect $770,710 against the future sale of Mingfei Zhao's home because the 64-year-old has left Canada and appears to be in the process of trying to sell the only asset he has left in this country.

The new 'Earl' of Shaughnessy breathes life into historic home
Zhao bought the 14,000-square foot Tudor-style property in 2014 to much fanfare, vowing to return the building to its original glory a century earlier when "the Rosemary" — named after the daughter of a liquor tycoon — was considered the grandest home ever built in Vancouver.

But according to the court documents, Zhao declared income of less than $10,000 in 2014 and $38,161 in 2015 — amounts CRA auditors concluded were "not sufficient" to support his purchase of real estate and monthly mortgage payments of $8,699.....

The court file includes more than 2,000 pages of documents detailing attempts to nail down Zhao's bank account balances, his unreported worldwide income and his whereabouts.

At one point, he also owned another multi-million dollar home as well as a Bentley, a Rolls Royce, a Mercedes and a Range Rover. But as of last June, he was only registered as the owner of the Rosemary and the Range Rover.

Last month, records showed Zhao no longer had a Canadian cellphone account.

In March, the CRA also claimed to have "uncovered" a Globe and Mail article from nearly two years earlier "in which it stated that Mr. Zhao no longer lived in Vancouver and that he had started a new family in Europe."...(bold mine)

https://www.cbc.ca/news/canada/british-columbia/mingfei-zhao-cra-jeopardy-1.6552742

Not certain it is all that surprising.

Anyone who buys Rolls, Bentleys and Ranger Rovers obviously has a thing for Europe.

[WarrenC12]

Originally Posted by lio45

At those income levels, the “Earl of Shaughnessy” receives quarterly GST/HST Credit checks.

Hilarious if it weren’t so stupid (and paid by us all).

(Not that I’m complaining too much about the stupidity; I have really low incomes compared to my wealth so I, like him, am among those benefiting from our idiotic taxation of productivity and un-taxation of wealth.)

Asset tax coming for you!

[O-tacular]

Originally Posted by lio45

At those income levels, the “Earl of Shaughnessy” receives quarterly GST/HST Credit checks.

Hilarious if it weren’t so stupid (and paid by us all).

(Not that I’m complaining too much about the stupidity; I have really low incomes compared to my wealth so I, like him, am among those benefiting from our idiotic taxation of productivity and un-taxation of wealth.)

Another day another not so humble brag. Please tell us more about your tax dodging and heritage building demolitions.

[lio45]

Originally Posted by O-tacular

Another day another not so humble brag. Please tell us more about your tax dodging and heritage building demolitions.

Why would I "brag"? This is an anonymous forum, there's no point. We're discussing how our choices of taxation have an impact on Canadian society and Canadian housing. My point is that I can't blame that guy for choosing real estate investment as an artificially favored/particularly low-tax investment class in this country. (While also being conscious that it's not ideal for the greater good.)

[lio45]

Originally Posted by O-tacular

Please tell us more about your tax dodging

I already told you everything there is to know about it (and I'd insist that the word "dodging" needs to be in quotation marks): real estate wealth in this country is not taxed beyond annual property taxes.

[Architype]

Originally Posted by lio45

I already told you everything there is to know about it (and I'd insist that the word "dodging" needs to be in quotation marks): real estate wealth in this country is not taxed beyond annual property taxes.

What about capital gains taxes? What about vacancy taxes? What about taxes on rental income? I assume you think it is unfair in some way (most people do), so you would like it to be tougher, to be fair.

[theman23]

Originally Posted by Architype

What about capital gains taxes? What about vacancy taxes? What about taxes on rental income? I assume you think it is unfair in some way (most people do), so you would like it to be tougher, to be fair.

Do real estate investors get away with paying capital gains tax rate? If so, its a bit weird that you can make all your money off real estate and only have to pay the capital gains rate but if make your money off another investment class (say, stocks) you have to pay the personal tax rate.

[Architype]

Originally Posted by theman23

Do real estate investors get away with paying capital gains tax rate? If so, its a bit weird that you can make all your money off real estate and only have to pay the capital gains rate but if make your money off another investment class (say, stocks) you have to pay the personal tax rate.

I am no expert, but 50% of your capital gains on investment properties (not occupied residence) are added to your personal income to be taxed at the normal rate. Corporate ownership is on another level, which I assume is full of loopholes. Perhaps the ostensible risk of the capital investment is rewarded in this way. Rental income is taxed at a higher rate than employment income AFAIK. However, if you are receiving income from dividends / shares it is lower. My question is whether any of these discrepancies are unfair or not?

[theman23]

Originally Posted by Architype

I am no expert, but 50% of your capital gains on investment properties (not occupied residence) are added to your personal income to be taxed at the normal rate.

That's just how the capital gains tax works.
My question is can you make a living flipping houses and get the preferential tax treatment of the capital gains rate, or do you have to start treating your gains as personal or business income as is the case with other assets (i.e. stocks)? And if it does get treated as persona/business income, how often is that actually enforced?

[Al Ski]

Originally Posted by theman23

That's just how the capital gains tax works.
My question is can you make a living flipping houses and get the preferential tax treatment of the capital gains rate, or do you have to start treating your gains as personal or business income as is the case with other assets (i.e. stocks)? And if it does get treated as persona/business income, how often is that actually enforced?

The less you make the more attention the CRA will pay to you - we've known this for a long time. There is ample data.

The harder you work the more scrutiny you'll attract. Again.. ample data..

Better to be a parasite in this economy. Flip houses, play the market, be a middleman .. contribute absolutely nothing to society and you will be rewarded.

This is what the Financialisation Of Everything has done to us - turned us from productive people in profit-making psychopaths who contribute nothing at all. Complete wastes of skin.

We're heading into the next recession/depression and a lot of these clowns will be culled but not the top 1% - they'll make out like bandits, once again. "Too big to fail"

It's been clear for a while now that our system is completely fucked. I don't know what more evidence is needed.

I guess a complete collapse, which is coming.

Too bad it it had to get to this after the 'lesson' of 2008.

[yaletown_fella]

The problem with a wealth tax is it will hit the lower middle-middle class renters/savers the hardest. The wealthy have the ability to buy a primary residence outright. Not to mention it's easier for the CRA to shake down people who can't afford to navigate complex tax loopholes.

So a renter who's spent a decade to accumulate $100,000 in the bank will get slaughtered by wealth/interest/dividend taxes, while someone who's only inherited exempt assets including a $6,000,000 house,, will get a free lunch.


Scrapping the TE for primary residence would be a great move to help deflate overheated real estate markets, especially in big cities. It would kill the incentive to one-off flip a SFH (which is extremely inflationary in a market with too much demand and limited supply), and instead there would be more incentive towards subdividing existing properties into multi-unit apartment houses.

[rbt]

Originally Posted by yaletown_fella

So a renter who's spent a decade to accumulate $100,000 in the bank will get slaughtered by wealth/interest/dividend taxes, while someone who's only inherited exempt assets including a $6,000,000 house,, will get a free lunch.

Neither of those people would get hit by the proposed wealth tax which has been proposed to begin at $10M of net-worth.

[casper]

Originally Posted by Architype

I am no expert, but 50% of your capital gains on investment properties (not occupied residence) are added to your personal income to be taxed at the normal rate. Corporate ownership is on another level, which I assume is full of loopholes. Perhaps the ostensible risk of the capital investment is rewarded in this way. Rental income is taxed at a higher rate than employment income AFAIK. However, if you are receiving income from dividends / shares it is lower. My question is whether any of these discrepancies are unfair or not?

Revenue Canada tries to design the rules so there is little tax advantage to being incorporated or not. In a specific situation there might be an slight advantage one way over the other but it is not significant.

Corporations have to pay corporate tax on profits before that cash becomes available to be issued as a dividend. For the owner of a company if you take the tax paid on the dividend and the tax paid by the corporation it should be close to the same tax as if the corporation were not there.