We, at ‘Ozbuzz’, wish you and yours a happy, exciting, eventful, challenging, successful, rewarding, wondrous and above all healthy 2020
2020 the Year of Plenty
• HOT PROPERTIES – US $13,000 FOR 4-PLEX!
• QUESTIONS, QUESTIONS
• INWARD MIGRATION “A QUARTER LIKE NEVER IN HISTORY”
• THE NUMBERS = HIGHER?
• ASSESSMENT TIME – GET READY TO FIGHT!
• TAXMAN COMETH FOR BNB?
• SPECULATION TAX AND EMPTY HOME TAX – HIGHER
• BOOK OF THE WEEK “PRINCIPLES FOR SUCCESS” by RAY DALIO
• SONGS OF THE WEEK – LISTEN – FEEL
• MAJOR FORECAST ISSUE – NEXT WEEK
Oz Buzz Podcast #29: Michael Campbell, Canada’s most respected business analyst
Will that major, pivotal US dollar trend reverse?
Euro up? Down? Negative rates? What stocks to buy? Gold up or down?
World Financial Outlook Conference
Ozzie chats with well-known, well-connected, articulate and knowledgeable Michael Campbell.
Canada’s most respected business analyst who runs ‘Money Talks’ every Saturday and does daily commentaries also – all at CKNW.
He covers everything to do with money. How to make it, how to spend it, how to grow it, and how to avoid letting it get away.
PS – The World Outlook Conference is Friday Feb 7th and Saturday, Feb. 8th at the Westin Bayshore in Vancouver.
For tickets and other details CLICK HERE.
REAL ESTATE VALUES GOING HIGHER – EVERYWHERE
Several questions and follow up statements on “can it go higher again” and my long answer to “Yes”. 8 subscribers agreed (we have been there before) and 3 disagreed (this time it is different Ozzie). We will do year end numbers and a prediction and outlook issue next week…and tackle the ‘wither we go’ in more detail.
INWARD MIGRATION? YOU AINT SEEN NOTHING YET!
- Our Jurock Real Estate Insider slogan has been for 21 years: “Values grow where people go and people go where the jobs are,” (or leave, where the job are not).
- At every Outlook and Landrush conference since 2011 we predicted continued inward migration, not just from Asia, but Iran … indeed from a world in turmoil everywhere. That inflow of people together with unconscionable money creation would result in ever higher prices.
- In addition, money flows here for safety! Immigrants bring it or just send their money for … safety. Canada was rated the third safest country (by ‘Afire’) and inward migration, together with relentless money creation would bode well for our (real estate investment) futures. So, we are not surprised by ever increasing international migration numbers. But even I did not foretell this enormous new Stats Canada number:
The country’s population grew by an astounding 208,234 in the July to September 2019 period, with some 83% of that increase due to international migration, according to estimates from Statistics Canada released December 19. Growth of this magnitude from international migration “had never been seen before in a single quarter,” the agency said.
New immigrants totaled 103,751 in the quarter, while the number of non-permanent residents rose by 82,438. British Columbia saw the fastest population growth.
Major Point 1: Federally, our government was predicting and planning for an annual $350,000 immigrants … now look at one quarter! People are – as I said speech after speech – running from falling currencies, crushing debt, collapsing economies and looking for a safe place. Which? Canada is at least at the top of choices. And in Canada? BC has the highest percentage increase and Alberta ‘the best in four years’!
ACE REALTOR BRENT ROBERTS SAYS: The market is hot, there is simply no product … I got multiple offers galore … He is talking Surrey/Delta, but we hear it from several places. Can’t wait for December numbers!
Major Point: Immigrants are here already. (Hong Kong leading?)
WHEN WE HEAR ‘AFFORDABILITY’ WE WANT TO HEAR ABOUT PRODUCING MORE HOUSING
But what we get is more taxes, more delays at all government levels (particularly at local), conflicting signals and developers backing off in confusion. Add to this new requirements, new landlord regulation etc. etc. Who wants to be a landlord? Who will build into this environment?
Major Point 2: Existing housing is in short supply, rents getting to all-time records. Fewer new houses will result in even higher prices. We need to stop talking and start doing… Cut through the regulations, make municipal costs more predictable, don’t create new ‘revenue sources’ halfway through construction … stop blaming developers, realtors, buyers; BUILD MORE PRODUCT AND PRICE INCREASES WILL STOP.
EYEBROW RAISER – THE TAXMAN COMETH AND ASSESSES …
More and more properties are for sale at well below assessed value. Remember, the assessed value of your property provides the base for the municipality to apply their mill rate – resulting in YOUR taxes. (The date of assessment is always July 2 of the previous year.) Here are 3 of hundreds of examples of properties listed between 16% and 25% below assessed value. Well below assessments:
GILPIN CRESCENT, $1,999,000 (21% below assessed value), FINCH COURT, $849,000 (25% below), FULLERTON Ave, $299,900 (16% below assessed value). Provided by Sam Mehrbod firstname.lastname@example.org. He has a list of properties for sale below assessed value.
What it means is that many if not most homeowners will be over assessed for 2019! What to do?
Go to bcassessment.ca website. It’s a fine site!
Type in your address NOW!
It will show you what your assessment is. You will get an assessment notice in the next week. Check it out against sales in the area now! Compare! (Actually, you can scroll down from your address to see other suites in your building or neighbour’s assessments.) ALSO – and this is important – you get recent comparable sales the authority uses to arrive at yours.
When you get the notice and you disagree – immediately dispute! There will be a thousand disputes in January – the sooner you do it the better.
- The deadline to appeal your 2020 Property Assessment is January 31, 2019.
- Call assessors first – they are not the enemy – show them your comparable sales and why you need your assessment changed. May be solved right there.
- Next: If it does not work, write to the Property Assessment Review Panel (PARP). Hearings take place between February 1 and March 15 each year. PARP members are members of the public appointed by the Minister.
- The second level of appeal is to the Property Assessment Appeal Board (“PAAB” or the “Board”). Board members are appointed by Cabinet. The right of appeal is available to “any person” who is dissatisfied with a decision of the PARP.
Major Point: With the gyrations in the market it is VERY likely that you are over assessed – particularly at the high end. (Westside is down 20-25% in price.) Act now.
THE TAXMAN COMETH AND BITES FOREIGNERS AGAIN!
January 1, 2019 the BC ‘speculation tax’ became law. In many areas of BC you must pay .5% vacant and speculation tax. (Yes, you are considered a speculator having a lake cottage in Kelowna). That meant also that many Albertans (yep, they pay too) decided to go to (literally) greener fields). The Result? It changed the way absentee (foreign) owners (and a complicated formula for’ satellite families) looked at the property.
Major Point 1: This year it is up to 2%. It was .5%, now this year it is 2%. So, a $3 million house in Vancouver (vacant by July 1) costs $60,000 ‘speculation tax and 1% or $30,000 ‘Vancouver city empty home tax’. (Plus, a .2% tax addition of a property assessed between 3 million to 4 million and .4% over 4 million!).
Major Point 2: The speculation tax raised $115 million in the government’s latest forecast, but overall sales activity dropped dramatically too – reducing the property purchase tax by $300 million plus. Who is the winner? Nobody.
THE TAXMAN COMETH
Vancouver’s empty home tax to go to 1.25% then 1.5% and then to 2% in the next couple of years.
THE TAXMAN COMETH (BYE, BYE BnB?)
Canadians who rent out their homes are starting to come to grips with the reality that they can run, but not hide, from the taxman.
Never mind your building strata corp. saying “thou shalt not use BnB” or the city saying you can only rent it out if you live there … now you must worry that:
a) You must declare the income
b) By renting BnB you change the status of your private residence to investment property and lose all/some of your free capital gain exemption. HUH?
c) If you collect more than $30,000 you must pay GST!
Remember: Even if you’re renting out a part of the home you live in through Airbnb, you still must claim it.
Expect CRA to get tougher. The CRA says it’s losing billions of dollars every year through unreported income from the sharing economy, which includes Airbnb. But the agency is taking a broader approach to the problem.
“The Canada Revenue Agency has identified the sharing economy as an area of risk for non-compliance,” reportedYahoo Finance Canada, who added that the agency is “identifying the highest risk files for compliance action” to ensure that hosts are paying their fair share. “The CRA will continue to monitor this sector, focusing our efforts on hosts that are providing short-term accommodations as a business.”
How do they go after the culprits? CRA has now an additional $66 million to target non-compliance in the digital economy!
1. POINT GREY OWNER wins against the empty home tax! A unique example, but it demonstrates the need to stick to your guns! Look it up here: https://vancouversun.com/news/local-news/point-grey-homeowner-wins-battle-for-review-of-249000-empty-homes-tax-bill
2. MICHEL GELLER ASKS: Where are the promised empty homes coming into the rental market (10,000 to 25,000 were promised.) Look up the great summary of Geller’s MUST READ columns in the ‘Vancouver Courier’: https://www.vancourier.com/opinion/where-are-the-thousands-of-empty-homes-returning-to-rental-market-like-b-c-politicians-promised-1.24036284
HOT PROPERTIES – FORECLOSURES
- Chilliwack Foreclosure
Foreclosure At: $529,900.00 (TAX $581,000.00)
LOT 8801sq ft, SQ FT HOUSE 2960 sq ft, 4 beds, 2.5 baths easy to suite.
Bidding and waiting involved.
- Connersville, Indiana, 4 plex, 4 x 1-bedroom units, needing renovation $13,000 US, could produce US $2000 a month once fixed up.
- Connersville, Indiana, 1 x Single family home, Minor TLC and ready to rent Price US $15,000 will rent for $650 a month.
- Pine Bluff, Arkansas, 3,600 sq ft, Mansion stye 4 baths, US $40,000
BOOK OF THE WEEK
Use to set your stage for 2020!
I recommended Ray Dalio’s “Principles” before. A Fab book. This week I recommend you read Principles for Success which distills the former. ‘Principles’ sold more than two million copies worldwide.
In this book Ray Dalio’s gives the key elements of the unconventional principles that helped Dalio become one of the world’s most successful people—and that have now been read and shared by millions worldwide—including how to set goals, learn from mistakes, and collaborate with others to produce exceptional results. Whether you’re already a fan of the ideas in Principles or are discovering them for the first time, this illustrated guide will help you achieve success in having the life that you want to have.
OZZIE SONGS OF THE WEEK
LIVE LIFE LARGE
First, we create internally
Then it manifests itself
My thoughts create my happiness
My dominant thoughts create my life
Every day I bring my thoughts
Into happy clarity
Look up all the
“Grow into your future best” cards at: www.commitperformmeasure.com
Jurock Real Estate Insider Holiday Special
Listen to Ozzie Jurock’s 25 Money Making Principles in the comfort of your home or car, as well as his two books, ‘Real Estate Action 2.0’ & ‘What, Where, When & How to buy Real Estate in Canada’ – now available on USB!
Choose from one of our three great holiday specials
WANT TO PARTICIPATE?
Go to www.realestatetalks.com – Some 2,500 members (47,009 posts) talk real estate. Ozzie created this bulletin board in 1998!
If you are in a real estate related industry of any sort (realtor, appraiser, lawyer, home inspector, etc.) list yourself in Ozzie’s free British Columbia real estate directory at www.bcred.ca.
OZZIE’S YOUTUBE CHANNEL
You can watch all videos and podcasts on my YouTube channel at https://www.youtube.com/jurockvideo. It is a great way to check on what I said 10 years ago.
Ozzie is on air with Michael Campbell on the fabulous MONEYTALKS every Saturday sometime between 8:30AM – 10 AM. The radio station is CKNW and the best way to listen to it is WHEREEVER YOU ARE IN THE WORLD, just visit www.cknw.com at 8:30 am every Saturday (PST), click on live and you’re good to go. The Hot Property that we discuss there, is available by subscribing to the Oz Buzz Dispatch at Jurock.com
Why subscribe if I can just go to the website at Ozbuzz.ca? Hot properties and the latest podcasts are DISTRIBUTED TO SUBSCRIBERS FIRST– posted 2 weeks later on website.
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