Heinrichs Developments? Mill District to take its place in Abbotsford

Michael Bernard
The Vancouver Sun

Project: Mill District

Project location:  2555 Ware St., Abbotsford

Project size/scope: A total of 82 homes, 41 units in each of two six-storey-high wood-frame buildings in the city’s Mill Lake neighbourhood. Walking distance to the 100-store Sevenoaks Shopping Centre and other amenities, including pedestrian pathways around Mill Lake

Prices: From the mid-$200,000s 

Developer: Heinrichs Developments 

Architect: David Tyrell Architecture

Interior Designer: i3 Design

Sales centre:  33323 South Fraser Way, Abbotsford

Hours: noon —5 p.m., Sat — Thurs 

Telephone: 604-621-5888

Website: http://www.MillDistrict.ca    

Occupancy: Summer 2018

If sales figures are any indication, Mill District, a multifamily project in the Fraser Valley community of Abbotsford, is tapping into an appetite for something new and somewhat different.

In the first week of sales, condo marketing firm MLA wrote up 20 deals for homes in the 82-unit complex, which is designed with bold green and yellow panels. Many of those deals involved downsizing seniors looking for an alternative to traditionally designed condo complexes, developer Gerald Heinrichs said.

“It’s fairly bold for Abbotsford, which is a traditional market,” he said. “We’ve had so much feedback from our purchasers and people who are attracted to it because it brings some excitement to living there. It’s not your plain vinyl siding and beige-and-white kind of project.”

In addition to the brightly coloured green panels and yellow soffits, the development, split into two six-storey buildings with 41 units each, features vertical corrugated panels and brick work for a decidedly more industrial take.

Heinrichs credits the Mission Group, a Kelowna-based development company in which he remains a partner while building his boutique Abbotsford-based development firm, for the outside-the-box look. Mission Group has attracted much attention over the last few years for its U1 and U2 student housing projects adjacent to the UBC Okanagan campus and its ambitious Central Green development on the old school property of the same name in Kelowna.

“The Mission Group is a forward-thinking company and a lot of that rubbed off on me,” he said.

Mill District was an easy choice for Mike Farina and his wife Beverley, who have lived in homes big and small in Abbotsford for more than 36 years.

“We had our name into every new place that went up over the last two or three years,” said Farina, a steel company sales executive. “Then we saw this and I said, ‘Hey, this looks different.’”

“I like the more modern type look to it, compared to a lot of buildings that look like they were built 20 years ago. It’s nice and fresh. Once we saw the show suite, my wife said: “’You know I could do this.’”

This past winter, when they were glad their adult son was around to shovel the significant snowfalls, they were persuaded that it was time to downsize from their 2,700-square-foot home on nearby Eagle Mountain. They purchased an 1,100-square-foot two-bedroom unit at Mill District.

Heinrichs said Mill District fills an unmet housing need in Abbotsford: townhouses and condos of a larger scale sought by downsizers and retirees selling their homes in Vancouver, Burnaby and Surrey and moving east. 

“You can sell your single-family home in Vancouver and probably buy an entire floor in this building,” he said. “I think you are going to see people pushing out of the west and moving to the east to retire and for affordability.”

Heinrichs says his architect and long-time friend David Tyrell is responsible for the building’s striking design, and that Abbotsford city council featured the building in one of its brochures.

 Tyrell, who also designs for Mission Group, said he favours a design with “structural and functional honesty”, one that is simple and minimalist, rather than decorative.

“The challenge of the site was one of proportion,” he said. “It is relatively narrow and deep and that caused us difficulty in how to create a project that would be neighbourly in one sense and was something that would be enjoyable to live in from the point of view of the residents.

“The original concept was a long narrow building that was centred on the site. But that resulted in a long double-loaded corridor that was anonymous and unfriendly with 12 to 14 doors on each side.

“So what we decided to do — and it’s a credit to the developer and the city planning department — is to break it into two more square buildings with a large gap in between. That afforded us the opportunity to create a ‘cluster’ feeling in which you were more likely to get to know your neighbours. The new design also reduced the shadow cast on adjacent buildings and protected some of their view corridors.’

Inside the homes, expansive windows and nine-foot ceilings create a sense of openness and allow in plenty of light while liberally sized covered balconies with gas barbecue fittings provide views of Mill Lake and the mountains beyond.

Main living areas feature wood-grain laminate flooring or an optional upgrade to brushed oak wide-plank engineered hardwood. Bedrooms are plush nylon carpeting.

Depending on the layout, suites come with a side-by-side Whirlpool front-loading washer and dryer.

Kitchens have premium KitchenAid stainless steel appliances with 30-inch full-depth refrigerators, 30-inch gas ranges, dishwashers with top controls and microwaves with hood fan. An upgrade to a Fisher and Paykel stainless steel package is also available.

Cabinetry is shaker style with soft-close doors and drawers and contemporary brushed nickel hardware. Countertops are made of polished quartz, complemented by an intricate hexagon-detailed matte tile backsplash. An island provides room for food prep and guest seating.

Bathroom floors are done in large-format 12-by-24 inch matte porcelain tile and countertops are durable laminate. Undermount sinks are available as an upgrade. Deep soaker bathtubs and frameless glass showers complete the offerings.

All homes come with air conditioning, while the secured underground parking area has spacious storage lockers.

Heinrichs Developments provides buyers with after-sales customer service and a one-year comprehensive warranty, while all homes are covered by a Travelers Insurance 2-5-10 warranty including two years for materials, five years for the building envelope and 10 years for structural elements.

© 2017 Postmedia Network Inc.

Landmark B.C. court ruling will shake real-estate industry

Douglas Todd
The Vancouver Sun

 

A B.C. Supreme Court ruling will send shock waves through the arm of the Canadian real-estate market that is powered by foreign capital, say immigration lawyers.

The ruling targets a weakness in Canadian laws that often leads foreign owners of real estate in cites such as Metro Vancouver and Toronto to claim they are “residents of Canada for tax purposes” when they are not.

The landmark B.C. decision requires notary public Tony Liu to pay his client more than $600,000 because Liu failed to adequately determine whether the Vancouver house his client was buying for $5.5 million had been owned by a tax resident of Canada.

As a result, the Canada Revenue Agency did not get paid, at the time of the sale, the 25 per cent capital gains tax it charges non-resident sellers of Canadian property on any profit they make on the sale.

So the CRA later demanded the buyer pay the $600,000 in tax. The buyer, in turn, sued Liu, arguing Liu failed to discover the seller was not a tax resident of Canada.

The CRA considers people who don’t live in the country at least six months a year and don’t pay income taxes here to be foreign property investors and speculators and thus subject to capital gains taxes.

Three Canadian immigration lawyers said the CRA tax-residency rule is often not enforced, even in over-heated housing markets in Vancouver and Toronto that are in part fuelled by offshore money.

The ruling published this month by B.C. Supreme Court Justice Kenneth Affleck strikes to the heart of a gaping hole in Canadian tax, immigration and property-transfer law, say the immigration lawyers.

The B.C. decision is a stark warning to real estate agents, notaries and lawyers who fail to ensure that sellers of properties are truly tax residents of Canada, said David Lesperance, a tax and immigration lawyer based in Toronto.

“This truly is a game changer,” said Vancouver immigration lawyer Richard Kurland.

“It’s a precedent. Real estate agents can now get a knock on the door from the taxman, asking for the (capital gains) taxes that should have been collected by Ottawa, because the agent failed to make adequate inquiries.”

Sam Hyman, a Vancouver immigration lawyer, said the judge’s decision alerts purchasers to “the dire consequences” of making offers on properties sold by people who may be trying to avoid capital gains tax by falsely declaring they are tax residents of Canada.

Many buyers and their agents, Hyman said, are not being diligent in making sure the seller is a physical or tax resident of Canada, while others are being “cavalier” or “engaging in wilful blindness” about it.

The immigration lawyers urged the B.C. government to end the “honour system” that leaves it largely up to sellers to state on real-estate-industry forms whether or not they are residents of Canada for tax purposes.  

They said the honour-system loophole could be fixed through Ottawa and Victoria agreeing to the sharing of information among the CRA, the federal Immigration Department and the arm of the B.C. government responsible for property sales.

The B.C. Liberals, Kurland said, have stubbornly refused to solve the costly problem by reforming the government’s property-transfer forms to require sellers to answer whether they are “a tax resident of Canada.”

The B.C. government, which last summer brought in a 15 per cent tax on foreign buyers to cool Metro Vancouver’s globalized real estate market, recently began to ask property sellers and buyers to answer, “What is your citizenship?”

But citizenship is irrelevant, Kurland said.

The issue that really matters to most Canadians and the CRA, he said, is tax residency, whether a home buyer or seller pays their fair share of taxes in this country.

All three lawyers say Canada is forgoing hundreds of millions of dollars in tax revenue by not enforcing the country’s tax-residency rules, which are designed in theory to give long-term residents an advantage over foreign nationals.

The lawyers said they hope the federal government – which this week pledged to “target high-risk international tax and abusive tax-avoidance cases” – will make it a priority for CRA to audit mansion owners who pay little or no income taxes.

It would be relatively easy for the CRA, Lesperance said, to conduct “lifestyle audits” on wealthy trans-national “astronauts,” also known as “ghosts,” who pay little or no income tax in Canada while financing family members to spend lavishly on expensive homes and cars in the country.

In some cases, Kurland said, dubious immigration professionals are advising clients they can “eat their cake and have it too.”

Some property owners, for instance, are claiming to real estate officials that they are Canadian residents, so they can avoid capital gains taxes while selling houses and qualify for permanent resident status.

But some of the same people, at the same time, are claiming to the CRA that they are not residents under our tax law, so they don’t have to declare their global income and property holdings, and pay income taxes on them in Canada.

© 2017 Postmedia Network Inc.

Landmark B.C. court ruling will shake real-estate industry

Douglas Todd
The Vancouver Sun

 

A B.C. Supreme Court ruling will send shock waves through the arm of the Canadian real-estate market that is powered by foreign capital, say immigration lawyers.

The ruling targets a weakness in Canadian laws that often leads foreign owners of real estate in cites such as Metro Vancouver and Toronto to claim they are “residents of Canada for tax purposes” when they are not.

The landmark B.C. decision requires notary public Tony Liu to pay his client more than $600,000 because Liu failed to adequately determine whether the Vancouver house his client was buying for $5.5 million had been owned by a tax resident of Canada.

As a result, the Canada Revenue Agency did not get paid, at the time of the sale, the 25 per cent capital gains tax it charges non-resident sellers of Canadian property on any profit they make on the sale.

So the CRA later demanded the buyer pay the $600,000 in tax. The buyer, in turn, sued Liu, arguing Liu failed to discover the seller was not a tax resident of Canada.

The CRA considers people who don’t live in the country at least six months a year and don’t pay income taxes here to be foreign property investors and speculators and thus subject to capital gains taxes.

Three Canadian immigration lawyers said the CRA tax-residency rule is often not enforced, even in over-heated housing markets in Vancouver and Toronto that are in part fuelled by offshore money.

The ruling published this month by B.C. Supreme Court Justice Kenneth Affleck strikes to the heart of a gaping hole in Canadian tax, immigration and property-transfer law, say the immigration lawyers.

The B.C. decision is a stark warning to real estate agents, notaries and lawyers who fail to ensure that sellers of properties are truly tax residents of Canada, said David Lesperance, a tax and immigration lawyer based in Toronto.

“This truly is a game changer,” said Vancouver immigration lawyer Richard Kurland.

“It’s a precedent. Real estate agents can now get a knock on the door from the taxman, asking for the (capital gains) taxes that should have been collected by Ottawa, because the agent failed to make adequate inquiries.”

Sam Hyman, a Vancouver immigration lawyer, said the judge’s decision alerts purchasers to “the dire consequences” of making offers on properties sold by people who may be trying to avoid capital gains tax by falsely declaring they are tax residents of Canada.

Many buyers and their agents, Hyman said, are not being diligent in making sure the seller is a physical or tax resident of Canada, while others are being “cavalier” or “engaging in wilful blindness” about it.

The immigration lawyers urged the B.C. government to end the “honour system” that leaves it largely up to sellers to state on real-estate-industry forms whether or not they are residents of Canada for tax purposes.  

They said the honour-system loophole could be fixed through Ottawa and Victoria agreeing to the sharing of information among the CRA, the federal Immigration Department and the arm of the B.C. government responsible for property sales.

The B.C. Liberals, Kurland said, have stubbornly refused to solve the costly problem by reforming the government’s property-transfer forms to require sellers to answer whether they are “a tax resident of Canada.”

The B.C. government, which last summer brought in a 15 per cent tax on foreign buyers to cool Metro Vancouver’s globalized real estate market, recently began to ask property sellers and buyers to answer, “What is your citizenship?”

But citizenship is irrelevant, Kurland said.

The issue that really matters to most Canadians and the CRA, he said, is tax residency, whether a home buyer or seller pays their fair share of taxes in this country.

All three lawyers say Canada is forgoing hundreds of millions of dollars in tax revenue by not enforcing the country’s tax-residency rules, which are designed in theory to give long-term residents an advantage over foreign nationals.

The lawyers said they hope the federal government – which this week pledged to “target high-risk international tax and abusive tax-avoidance cases” – will make it a priority for CRA to audit mansion owners who pay little or no income taxes.

It would be relatively easy for the CRA, Lesperance said, to conduct “lifestyle audits” on wealthy trans-national “astronauts,” also known as “ghosts,” who pay little or no income tax in Canada while financing family members to spend lavishly on expensive homes and cars in the country.

In some cases, Kurland said, dubious immigration professionals are advising clients they can “eat their cake and have it too.”

Some property owners, for instance, are claiming to real estate officials that they are Canadian residents, so they can avoid capital gains taxes while selling houses and qualify for permanent resident status.

But some of the same people, at the same time, are claiming to the CRA that they are not residents under our tax law, so they don’t have to declare their global income and property holdings, and pay income taxes on them in Canada.

© 2017 Postmedia Network Inc.

Landmark B.C. court ruling will shake real-estate industry

Douglas Todd
The Vancouver Sun

 

A B.C. Supreme Court ruling will send shock waves through the arm of the Canadian real-estate market that is powered by foreign capital, say immigration lawyers.

The ruling targets a weakness in Canadian laws that often leads foreign owners of real estate in cites such as Metro Vancouver and Toronto to claim they are “residents of Canada for tax purposes” when they are not.

The landmark B.C. decision requires notary public Tony Liu to pay his client more than $600,000 because Liu failed to adequately determine whether the Vancouver house his client was buying for $5.5 million had been owned by a tax resident of Canada.

As a result, the Canada Revenue Agency did not get paid, at the time of the sale, the 25 per cent capital gains tax it charges non-resident sellers of Canadian property on any profit they make on the sale.

So the CRA later demanded the buyer pay the $600,000 in tax. The buyer, in turn, sued Liu, arguing Liu failed to discover the seller was not a tax resident of Canada.

The CRA considers people who don’t live in the country at least six months a year and don’t pay income taxes here to be foreign property investors and speculators and thus subject to capital gains taxes.

Three Canadian immigration lawyers said the CRA tax-residency rule is often not enforced, even in over-heated housing markets in Vancouver and Toronto that are in part fuelled by offshore money.

The ruling published this month by B.C. Supreme Court Justice Kenneth Affleck strikes to the heart of a gaping hole in Canadian tax, immigration and property-transfer law, say the immigration lawyers.

The B.C. decision is a stark warning to real estate agents, notaries and lawyers who fail to ensure that sellers of properties are truly tax residents of Canada, said David Lesperance, a tax and immigration lawyer based in Toronto.

“This truly is a game changer,” said Vancouver immigration lawyer Richard Kurland.

“It’s a precedent. Real estate agents can now get a knock on the door from the taxman, asking for the (capital gains) taxes that should have been collected by Ottawa, because the agent failed to make adequate inquiries.”

Sam Hyman, a Vancouver immigration lawyer, said the judge’s decision alerts purchasers to “the dire consequences” of making offers on properties sold by people who may be trying to avoid capital gains tax by falsely declaring they are tax residents of Canada.

Many buyers and their agents, Hyman said, are not being diligent in making sure the seller is a physical or tax resident of Canada, while others are being “cavalier” or “engaging in wilful blindness” about it.

The immigration lawyers urged the B.C. government to end the “honour system” that leaves it largely up to sellers to state on real-estate-industry forms whether or not they are residents of Canada for tax purposes.  

They said the honour-system loophole could be fixed through Ottawa and Victoria agreeing to the sharing of information among the CRA, the federal Immigration Department and the arm of the B.C. government responsible for property sales.

The B.C. Liberals, Kurland said, have stubbornly refused to solve the costly problem by reforming the government’s property-transfer forms to require sellers to answer whether they are “a tax resident of Canada.”

The B.C. government, which last summer brought in a 15 per cent tax on foreign buyers to cool Metro Vancouver’s globalized real estate market, recently began to ask property sellers and buyers to answer, “What is your citizenship?”

But citizenship is irrelevant, Kurland said.

The issue that really matters to most Canadians and the CRA, he said, is tax residency, whether a home buyer or seller pays their fair share of taxes in this country.

All three lawyers say Canada is forgoing hundreds of millions of dollars in tax revenue by not enforcing the country’s tax-residency rules, which are designed in theory to give long-term residents an advantage over foreign nationals.

The lawyers said they hope the federal government – which this week pledged to “target high-risk international tax and abusive tax-avoidance cases” – will make it a priority for CRA to audit mansion owners who pay little or no income taxes.

It would be relatively easy for the CRA, Lesperance said, to conduct “lifestyle audits” on wealthy trans-national “astronauts,” also known as “ghosts,” who pay little or no income tax in Canada while financing family members to spend lavishly on expensive homes and cars in the country.

In some cases, Kurland said, dubious immigration professionals are advising clients they can “eat their cake and have it too.”

Some property owners, for instance, are claiming to real estate officials that they are Canadian residents, so they can avoid capital gains taxes while selling houses and qualify for permanent resident status.

But some of the same people, at the same time, are claiming to the CRA that they are not residents under our tax law, so they don’t have to declare their global income and property holdings, and pay income taxes on them in Canada.

© 2017 Postmedia Network Inc.

Landmark B.C. court ruling will shake real-estate industry

Douglas Todd
The Vancouver Sun

 

A B.C. Supreme Court ruling will send shock waves through the arm of the Canadian real-estate market that is powered by foreign capital, say immigration lawyers.

The ruling targets a weakness in Canadian laws that often leads foreign owners of real estate in cites such as Metro Vancouver and Toronto to claim they are “residents of Canada for tax purposes” when they are not.

The landmark B.C. decision requires notary public Tony Liu to pay his client more than $600,000 because Liu failed to adequately determine whether the Vancouver house his client was buying for $5.5 million had been owned by a tax resident of Canada.

As a result, the Canada Revenue Agency did not get paid, at the time of the sale, the 25 per cent capital gains tax it charges non-resident sellers of Canadian property on any profit they make on the sale.

So the CRA later demanded the buyer pay the $600,000 in tax. The buyer, in turn, sued Liu, arguing Liu failed to discover the seller was not a tax resident of Canada.

The CRA considers people who don’t live in the country at least six months a year and don’t pay income taxes here to be foreign property investors and speculators and thus subject to capital gains taxes.

Three Canadian immigration lawyers said the CRA tax-residency rule is often not enforced, even in over-heated housing markets in Vancouver and Toronto that are in part fuelled by offshore money.

The ruling published this month by B.C. Supreme Court Justice Kenneth Affleck strikes to the heart of a gaping hole in Canadian tax, immigration and property-transfer law, say the immigration lawyers.

The B.C. decision is a stark warning to real estate agents, notaries and lawyers who fail to ensure that sellers of properties are truly tax residents of Canada, said David Lesperance, a tax and immigration lawyer based in Toronto.

“This truly is a game changer,” said Vancouver immigration lawyer Richard Kurland.

“It’s a precedent. Real estate agents can now get a knock on the door from the taxman, asking for the (capital gains) taxes that should have been collected by Ottawa, because the agent failed to make adequate inquiries.”

Sam Hyman, a Vancouver immigration lawyer, said the judge’s decision alerts purchasers to “the dire consequences” of making offers on properties sold by people who may be trying to avoid capital gains tax by falsely declaring they are tax residents of Canada.

Many buyers and their agents, Hyman said, are not being diligent in making sure the seller is a physical or tax resident of Canada, while others are being “cavalier” or “engaging in wilful blindness” about it.

The immigration lawyers urged the B.C. government to end the “honour system” that leaves it largely up to sellers to state on real-estate-industry forms whether or not they are residents of Canada for tax purposes.  

They said the honour-system loophole could be fixed through Ottawa and Victoria agreeing to the sharing of information among the CRA, the federal Immigration Department and the arm of the B.C. government responsible for property sales.

The B.C. Liberals, Kurland said, have stubbornly refused to solve the costly problem by reforming the government’s property-transfer forms to require sellers to answer whether they are “a tax resident of Canada.”

The B.C. government, which last summer brought in a 15 per cent tax on foreign buyers to cool Metro Vancouver’s globalized real estate market, recently began to ask property sellers and buyers to answer, “What is your citizenship?”

But citizenship is irrelevant, Kurland said.

The issue that really matters to most Canadians and the CRA, he said, is tax residency, whether a home buyer or seller pays their fair share of taxes in this country.

All three lawyers say Canada is forgoing hundreds of millions of dollars in tax revenue by not enforcing the country’s tax-residency rules, which are designed in theory to give long-term residents an advantage over foreign nationals.

The lawyers said they hope the federal government – which this week pledged to “target high-risk international tax and abusive tax-avoidance cases” – will make it a priority for CRA to audit mansion owners who pay little or no income taxes.

It would be relatively easy for the CRA, Lesperance said, to conduct “lifestyle audits” on wealthy trans-national “astronauts,” also known as “ghosts,” who pay little or no income tax in Canada while financing family members to spend lavishly on expensive homes and cars in the country.

In some cases, Kurland said, dubious immigration professionals are advising clients they can “eat their cake and have it too.”

Some property owners, for instance, are claiming to real estate officials that they are Canadian residents, so they can avoid capital gains taxes while selling houses and qualify for permanent resident status.

But some of the same people, at the same time, are claiming to the CRA that they are not residents under our tax law, so they don’t have to declare their global income and property holdings, and pay income taxes on them in Canada.

© 2017 Postmedia Network Inc.

Landmark B.C. court ruling will shake real-estate industry

Douglas Todd
The Vancouver Sun

 

A B.C. Supreme Court ruling will send shock waves through the arm of the Canadian real-estate market that is powered by foreign capital, say immigration lawyers.

The ruling targets a weakness in Canadian laws that often leads foreign owners of real estate in cites such as Metro Vancouver and Toronto to claim they are “residents of Canada for tax purposes” when they are not.

The landmark B.C. decision requires notary public Tony Liu to pay his client more than $600,000 because Liu failed to adequately determine whether the Vancouver house his client was buying for $5.5 million had been owned by a tax resident of Canada.

As a result, the Canada Revenue Agency did not get paid, at the time of the sale, the 25 per cent capital gains tax it charges non-resident sellers of Canadian property on any profit they make on the sale.

So the CRA later demanded the buyer pay the $600,000 in tax. The buyer, in turn, sued Liu, arguing Liu failed to discover the seller was not a tax resident of Canada.

The CRA considers people who don’t live in the country at least six months a year and don’t pay income taxes here to be foreign property investors and speculators and thus subject to capital gains taxes.

Three Canadian immigration lawyers said the CRA tax-residency rule is often not enforced, even in over-heated housing markets in Vancouver and Toronto that are in part fuelled by offshore money.

The ruling published this month by B.C. Supreme Court Justice Kenneth Affleck strikes to the heart of a gaping hole in Canadian tax, immigration and property-transfer law, say the immigration lawyers.

The B.C. decision is a stark warning to real estate agents, notaries and lawyers who fail to ensure that sellers of properties are truly tax residents of Canada, said David Lesperance, a tax and immigration lawyer based in Toronto.

“This truly is a game changer,” said Vancouver immigration lawyer Richard Kurland.

“It’s a precedent. Real estate agents can now get a knock on the door from the taxman, asking for the (capital gains) taxes that should have been collected by Ottawa, because the agent failed to make adequate inquiries.”

Sam Hyman, a Vancouver immigration lawyer, said the judge’s decision alerts purchasers to “the dire consequences” of making offers on properties sold by people who may be trying to avoid capital gains tax by falsely declaring they are tax residents of Canada.

Many buyers and their agents, Hyman said, are not being diligent in making sure the seller is a physical or tax resident of Canada, while others are being “cavalier” or “engaging in wilful blindness” about it.

The immigration lawyers urged the B.C. government to end the “honour system” that leaves it largely up to sellers to state on real-estate-industry forms whether or not they are residents of Canada for tax purposes.  

They said the honour-system loophole could be fixed through Ottawa and Victoria agreeing to the sharing of information among the CRA, the federal Immigration Department and the arm of the B.C. government responsible for property sales.

The B.C. Liberals, Kurland said, have stubbornly refused to solve the costly problem by reforming the government’s property-transfer forms to require sellers to answer whether they are “a tax resident of Canada.”

The B.C. government, which last summer brought in a 15 per cent tax on foreign buyers to cool Metro Vancouver’s globalized real estate market, recently began to ask property sellers and buyers to answer, “What is your citizenship?”

But citizenship is irrelevant, Kurland said.

The issue that really matters to most Canadians and the CRA, he said, is tax residency, whether a home buyer or seller pays their fair share of taxes in this country.

All three lawyers say Canada is forgoing hundreds of millions of dollars in tax revenue by not enforcing the country’s tax-residency rules, which are designed in theory to give long-term residents an advantage over foreign nationals.

The lawyers said they hope the federal government – which this week pledged to “target high-risk international tax and abusive tax-avoidance cases” – will make it a priority for CRA to audit mansion owners who pay little or no income taxes.

It would be relatively easy for the CRA, Lesperance said, to conduct “lifestyle audits” on wealthy trans-national “astronauts,” also known as “ghosts,” who pay little or no income tax in Canada while financing family members to spend lavishly on expensive homes and cars in the country.

In some cases, Kurland said, dubious immigration professionals are advising clients they can “eat their cake and have it too.”

Some property owners, for instance, are claiming to real estate officials that they are Canadian residents, so they can avoid capital gains taxes while selling houses and qualify for permanent resident status.

But some of the same people, at the same time, are claiming to the CRA that they are not residents under our tax law, so they don’t have to declare their global income and property holdings, and pay income taxes on them in Canada.

© 2017 Postmedia Network Inc.

Blame BC government for real estate market

Barry Magee
The Vancouver Sun

The never-ending anger toward real estate in Vancouver can be very intense sometimes. For first-time buyers, getting priced out of the market brings with it a range of emotions and a never-ending gamut of blame. Blame the foreigners! Blame the speculators! Blame real-estate agents! Blame the City of Vancouver! Blame Christy Clark! Blame the rich! Blame the poor! One thing that seems to be ignored in the discussion is that B.C. real estate owners are the most taxpayer subsidized in all of Canada.

And it’s not even close.

Let’s start with the Home Owner Grant. Every January there is a media storm wondering how much the government will change the exemption to. You know why this is big news every year? It’s because this is a component for a lot of homeowners trying to decide whether or not they sell their property or keep it. So every year the B.C. taxpayer pays some of its citizens $570 toward their property taxes, whereas in an unsubsidized market these owners could be inclined to sell. In a market where the lack of supply is often argued as a reason for high prices, the provincial government puts an unwarranted restraint on the property market’s natural supply of listings with this program.

Yes, some homeowners might be forced to sell their properties and that is a horrible thing when someone is in that situation. That’s also how it plays out in every other real estate market in Canada, North America and the rest of the world. And let’s not forget that the owner could, in theory, be sitting on $1.6 million worth of real estate. Downsizing or losing your property is a natural order of a free, real estate market, and our government currently actively interferes with this occurrence.

The Home Owner Grant will cost B.C. taxpayers $857 million during the coming fiscal year, and was introduced by the Social Credit government of WC Bennett in 1957, and amended by his son Bill Bennett in 1980. At the time the market was in a serious downturn with homes that were recently bought underwater, meaning their value was less than what was owed on the mortgage. Interest rates were also pushing 21 per cent, so the measure was likely needed to help a large number of property owners avoid foreclosure. Currently, B.C. is the only province in Canada that provides immediate tax relief simply based on an owner living in their home.

Now onto the property-tax deferral program. This program is increasing in popularity every year. In B.C., when you turn 55, you can apply to have all of your property tax deferred until you sell your home. Not only does the provincial government pay these taxes for you, but they charge you an extraordinarily low interest rate of 0.7 per cent for the benefit. We aren’t the only province in Canada to offer a program of this nature, but our program is by far the most lucrative for homeowners.

B.C. is the only province in Canada to allow application for this deferral at 55 (all other provinces who offer it you need to be 65 to apply), offers an interest rate at almost one-quarter its closest comparable (Alberta at 2.7 per cent), and is the only province that doesn’t qualify applicants based on having a low income. According to the recent budget, about $154 million in property taxes are currently deferred as part of this program. If B.C. was to make a simple change and charge the same interest rate as Alberta, our government’s assets would increase by $3 million this year. A small amount, but again this is another program that interferes with the real estate market’s natural supply of listings.

In other parts of Canada, if you want to retire early at 55, you sell your home and downsize. In our province, taxpayers subsidize you so you can stay in your current home. After all, $8,000-$10,000 a year pays a lot of bills. The provincial property-tax deferral program was introduced by the NDP government of Dave Barrett in 1974.

In January, Clark’s Liberal government introduced another taxpayer-funded program into the real estate market, the B.C. Home Owner Mortgage and Equity Partnership. Now I believe it’s in every person’s financial interest to own their primary residence at the very least, but should the ability to do so come at a cost to other taxpayers? This program is set to cost B.C. taxpayers $728 million over the next three years, and is estimated to add 1,400 buyers to the B.C. market in each of those years. While the loans will be repaid as long as the equity in the property remains in the red, the loans are interest free for the first five years.

So the provincial government subsidizes the real estate market to the tune of somewhere around $1.25 billion every year. Two programs affect supply by offering an incentive not to sell, and the other creates demand by encouraging people to buy. Just another three ingredients in the perfect recipe for higher prices and lower affordability for first-time buyers.

Of these programs, the most equitable program is the property-tax deferral program, but is still likely too generous and should be tightened. The Home Owner Grant is a classic example of a regressive tax break that favours those who already have means. It was likely needed in 1980, but in 2017 it isn’t. The mortgage and equity partnership is a classic example of a government stimulating demand and interfering with the economics of the free market. If the government put the money from these two programs into eliminating the Medical Services Plan premium they could eliminate about two-fifths of everyone’s fees with a simple transfer of this priority.

This would be a progressive way to evenly distribute B.C.’s wealth, and would also be a tax break for businesses who pay their employees’ fees — to stimulate employment growth. The effect on the real estate market also shouldn’t be ignored or minimized. Eliminating these tax breaks would increase the supply of available properties for sale. If you want stability in an out-of-control real estate market, one step to take would be to stop subsidizing homeowners with these financial incentives.

© 2017 Postmedia Network Inc.

The Vancouver Sun

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G. MARION JOHNSON
The Vancouver Sun

If there’s one subject that dominates local headlines in Metro Vancouver, it’s real estate. With so much happening in the market, it can be hard to make sense of it all.

That’s especially true for home buyers, who may be as overwhelmed as they are excited about making the biggest purchase of their lives.

The long-term effects of last year’s government interventions into the market won’t be fully known for some time. And despite those efforts to temper escalating prices, demand remains consistent with long-term trends while supply is limited.

In fact, February 2017 had the lowest number of homes listed for sale compared to the same month since 2003. New listings for detached, attached and apartment properties in Metro Vancouver totalled 3,666, a decrease of nearly 37 per cent compared to February 2016.

Residential home sales in the region in February 2017, meanwhile, were down by close to 42 per cent from the record-breaking activity one year earlier, but remained in line with the long-term historical average for the month.

To gain a competitive edge when it comes to making a successful offer, you need to be prepared going in and work with your local Realtor.

“You want to have your ducks lined up: be pre-approved for a mortgage so you know what price point you’re looking at and be crystal clear on financing, what’s available to you and what you can afford,” says Dan Morrison, president of the Real Estate Board of Greater Vancouver (REBGV). “The important thing for buyers is to find a Realtor who specializes in your neighbourhood and in the type of product you’re looking for. A Realtor who’s acting for you understands the nuances of your situation and will help you manage expectations and get the home you want at the price you can afford.”

Although finding a house with a white- picket fence within a five- minute commute downtown is simply not a reality for most buyers, it’s important to understand that Metro Vancouver is not the homogenous market it’s often portrayed as being in the media.

“Every neighbourhood is different, every buyer and seller is different, every product is different,” Morrison says. “There are lots of opportunities within Metro Vancouver.”

For example, the price of condominiums today ranges between $375,000 and $650,000 depending on size and location.

Townhomes range between $500,000 and $900,000 in the region.

Detached homes in the City of Vancouver are at the high end of the market. Recent activity has pushed homes on Vancouver’s Westside above $3.4 million.

It’s a different story in neighbouring communities. The benchmark price of a detached home in Maple Ridge is $710,400; in Ladner the benchmark price is $947,900; in Port Coquitlam the benchmark price is $860,000.

The region appears to be heading into a more typical spring market compared to the past two atypical years, says REBGV President-Elect Jill Oudil. However, it’s still not uncommon for buyers to find themselves up against multiple offers, particularly on condos and townhomes.

Realtors are trained negotiators who can help buyers who may be swayed by the emotional aspect of purchasing a home and the intensity of bidding wars.

“Especially for the first- time buyer, it can be quite stressful,” says Oudil. “A Realtor can guide you through that process. It doesn’t always work out the way the buyer wants it to, but you’ve just got to keep plugging away at it.”

Realtors have exclusive information and resources to help buyers put together a winning offer. While the public has access to www.realtor.ca (formerly mls.ca) to view basic property information for any property listed on the Multiple Listing Service ® ( MLS® ), the most extensive real estate listing website in Canada, only Realtors have access to MLS ® itself and the detailed historical housing information it contains.

Planning ahead helps the process tremendously. If you’re contemplating buying a home next year, now is the time to start looking.

“Start going online and dropping by open houses, so that when you’re ready to begin the process, you’re knowledgeable already,” Morrison says.

Word of mouth remains a reliable way of finding a Realtor to work with. “Talk to your friends, family, neighbours and coworkers and get the names of Realtors they would recommend,” Morrison says. “Interview them; get them to give you a full presentation of how they work with their buyers and make sure they’re available when you’re available. Make sure they understand your situation, your requirements, and be totally honest with them.”

That last point is something Oudil can’t emphasize enough. As she tells her own clients, there’s no such thing as a stupid question.

“I think it’s important to work with someone you’re really comfortable with, who can guide and advise you through the whole process,” Oudil says. “Realtors care about their clients and are in it with you for the long term.”

© 2017 Postmedia Network Inc

Steve Randall
REP

While some of the measures outlined this week in the federal government’s budget have been welcomed by the real estate industry, there is still room for criticism.

The Greater Montreal Real Estate Board says that it would have liked to have seen concrete commitments on tax measures related to housing, particularly the Home Buyers’ Plan.

“There is no clear commitment from the government regarding the HBP, particularly in terms of an increase in eligible amounts or in terms of using the HBP during significant life changes, as promised in the Liberal Party’s platform for the October 2015 election,” said Daniel Dagenais, President of the GMREB Board of Directors.

“In 1992, the maximum eligible amount of $20,000 represented more than 13 per cent of the average property price in Canada, whereas today, the eligible amount of $25,000, increased in 2009, represents barely 5 per cent of the average property price,” he added.

The board also wanted to see more incentives for first-time buyers who have been affected by changes to mortgage rules.

The budget has also been criticized by housing advocates behind the Generation Squeeze campaign.

In a blog post, the campaign highlights that Ottawa’s National Housing Strategy spoke of vulnerable seniors while having “no mention of young Canadians struggling with the rising costs of rent and ownership.

It says that many seniors have benefitted from housing wealth while young Canadians are left with a burden of deficits which could have been reduced by taxing the capital gains from the housing wealth of seniors.

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