No doubt you have heard talk of speculation tax the NDP Government imposed in their recent budget. Adam Olsen, MLA for Saanich and the Gulf Islands says his constituency office has received more emails about this issue than any other, a sampling of them are available in his blog.
Says Olsen, “For a retired fixed-income couple or individual, assuming the fact they can pay (an) upfront tax, the unknown of whether they’d get money back at the end of the year when they file their income taxes is problematic.”
Indeed, Mr. Olsen’s comments are a reality for at least one client couple who have already been forced to list their Victoria condo, and a deep concern for another client who wrote the eloquent letter below.
If you face the same choice or have concerns, join the 9,000 people have signed the petition to stop this tax. You can also write your MLA, or the Hon. Carol James, Minister of Finance and Deputy Premier.
The Hon. Carole James
Minister of Finance and Deputy Premier
MLA for Victoria – Beacon Hill
Dear Minister James:
I am writing to strongly oppose the real estate speculation tax, in particular how this will affect home owners in the affected areas who use their home as a personal residence, but also reside in another Canadian province and under the Income Tax Act must consider the latter as primary residence.
Although I am required to list Quebec as my primary residence because I earn a salary there, I have built a life in Victoria over a period of 20 years. Thirteen years ago, I purchased a new town home in Victoria, in your riding, as part of my long term plan to relocate. I now spend about 40% of my time in residence in my townhouse and I am working towards 49% (the maximum to keep Quebec health insurance benefits) before completing the move in 2021. I am here every month and for extended periods over the summer and Christmas period. My social network is here, including my partner, many friends and relatives.
Applying this tax to people in my circumstances would impose undeserved and significant hardship. We are not the problem. We are not speculators; we are not leaving our homes empty; we are not laundering money; we are not hiding our money offshore. We are hard working, middle class Canadians who love the life that we are building here and who are contributing to the community and to the economy.
As a Canadian, I do pay for BC services through:
Property tax: I pay the full assessed amount, not being eligible for discounts for a primary residence or age.
Provincial sales tax and general contributions to the local economy: I purchased a home, complete furnishings, a new automobile, original artwork, kayaks, bicycles, etc., as well as paying the expenses of daily living locally. I frequent local businesses and buy locally grown food.
Federal transfer payments and federal investments in BC: I pay considerable income tax to Revenue Canada, and thus indirectly contribute to BC. For example, federal transfers to BC were $6.680 billion in 2017-18 and are estimated at $6.925 billion in 2018-19 https://www.fin.gc.ca/fedprov/mtp-eng.asp#notes.
With this new real estate tax, I am being told that I must pay a hefty annual premium if I want to keep this life I have built and complete my plan. What are my options?
Rent my townhouse: I am here every month. So, I would have to rent somewhere else and give up living in my beautiful home. Oh, then I would have to declare the rental income, meaning I would pay more anyway. If I would have to pay the tax upfront, even if renting, the tax rebate would come through filing BC provincial income tax. How would that work?
Sell my townhouse: I have put money and effort into making this a beautiful home. The idea of not living in it is heartbreaking – I have never intended to sell, but to make it my permanent home. Thus, either I couldn’t come here or I would need to rent somewhere else to live, which would be a zero sum game in the number of available housing units. Also, I would have to pay capital gains on this property and then more taxes to purchase another property should the time come to be a permanent resident – i.e., start over. This is a money losing proposition as well as personally distressing.
Quit my job and fully move to BC ahead of schedule: I am a research scientist working on treatments for ALS and employing several people in my laboratory. So, this option has consequences beyond me personally.
Just pay a premium of over $40,000 in tax: I would have to pay the BC government over $1000/month to keep what I lawfully own. This just seems unfair and exorbitant for my circumstances. It would also strongly curtail my disposable income to spend at local businesses.
None of these options is palatable. In fact, they look and feel like extortion.
I do understand the concern about affordable housing in popular places to live like Victoria (It’s a world-wide issue), but I urge you to think carefully if the plan you have proposed really addresses that problem. I, as well as many analysts, think not. Rather there would be a domino effect, with detrimental consequences to the economy. Aside from not serving many BC residents fairly, this tax would impose undeserved hardship on Canadians such as myself who have planned and worked hard to participate in this life, who spend our money in BC and who contribute to the community.
A Very Concerned Part-time Resident of Victoria
Welcome to February, and all the Daffodils poking their heads out of the ground.
Meanwhile it is Valentines Day, and while we tried everything to find a reservation at one of our favourite places for dinner, with no luck, we came up with an even better idea. We decided to call our favourite caterer “Nicholas Waters, owner of Toque Catering,” who helped us capture the romance of Valentines Day in our own home, with our “Boy Cooper.”
New Mortgage Rules and You
With all the chatter about qualifying for a mortgage these days it may feel impossible to the first time buyer, who has saved hard, to own your own home. But don’t fret, these measures were implemented to protect you over the long term. It may mean you purchase a condominium, or an older home, or simply broaden your search on the map. If you are willing to be flexible, I can find a home for you.
A trustworthy mortgage broker has experience, knowledge, access to all lenders, and can get you the best mortgage for your situation.
Victoria Mortgage Broker, John Wallace from Invis Mortgage Experts agrees, “ The new rules have made the mortgage landscape significantly more confusing, and getting good, solid advice is critical.”
While 2017 was rewarding in so many ways, there’s nothing like a brand new year to mark a fresh start.
Many of you know that the charities I have supported over the years have raised more than ten million dollars for people in need, and my work as a REALTOR and PHILANTHROPIST has ‘OPENED DOORS’ in ways I could not have imagined.
One of my fresh starts in 2018 was being selected by Boulevard Magazine to appear in their upcoming “Influencers” issue. They asked what I believe it takes to be a visionary. A leader. An influencer.
Steve Jobs said, “The people who are crazy enough to change the world are the ones who often do.” While I think being a little crazy helps, I also believe it requires: kindness, passion, determination, and being open to the opportunities that are often right in front of us but are sometimes difficult to see. Most important of all, it’s being aware of the great responsibility in the choices you make.
May all your fresh starts take you to places you’ve never dreamed of before. All the best for 2018.
Are you looking to sell? I have clients looking for properties in most areas of Victoria, and when they find them, expect to see five new executive listings come to market. We’re looking for:
– Condo in Bayview One – Up to 1.25 M
– Waterfront or Water View Townhouse Cordova Bay
– End Unit Condo in Sayward Hill with large patio – Not yet listed
– Rancher in Matticks Wood under 1.2
– Townhouse in Wedgewood Estates with Master on the Main
106 – 75 Songhees Road
Approximately 2500 square foot, three bedroom, luxury town home at Mariner’s Landing on Victoria’s historic inner harbour, This stunning home has been renovated by Griffen Designs to ultimate standards. Up to 1.2 million.
Click here for photos, floorplans, and a virtual open house: http://uplist.ca/h/DeedrieBallard-106-75-Songhees-Rd
A total of 462 properties sold in the Victoria Real Estate Board region this December, 1.9 per cent fewer than the 471 properties sold in December last year.
A grand total of 8,944 properties sold over the course of 2017, 15.8 percent fewer than the record breaking 10,622 that sold in 2016. 2017 sales came in at 21.7 per cent over the ten year average of 7,349 properties sold.
“Early in 2017 we discussed how the Victoria area housing market would be different than the record breaking year we had in 2016 and that over the course of the year we’d probably see a gradual return to a more balanced market. We did see evidence of this change come early in the year, as multiple offers and rapid price increases leveled out,” says Victoria Real Estate Board President Ara Balabanian. “However, the ongoing low inventory of properties for sale meant that buyers continued to experience competitive situations in high demand areas, and multiple offers were still a common occurrence as buyers negotiated in a tighter market. What we couldn’t anticipate were outside factors such as changes to mortgage qualifying rules that may have pushed people into the market early. The pending mortgage stress test in particular is likely to have caused much of the increased activity we’ve seen in November and December.”
2017 was a rewarding year in so many ways. The charities I support raised many Hundreds of Thousands of Dollars for Palliative, Homeless, Veterans, Children’s Miracle Network, and the Arts. Without a doubt, volunteering has opened many doors for me, and allowed me to meet people I would never have had the opportunity to meet, from the Her Majesty Queen to our street’s homeless; they have all left a tremendous mark on my life.
As 2017 draws to a close, I feel grateful for my family and for friends like you. I wish you a magical Holiday Season, and a happy new year.