Saturday, March 28, 2009

How are other countries handling the financial crisis?

First Home Buyers Grant Sparks housing Boom.

THE housing industry is booming thanks to the First Home Owners Boost - and builders are having a hard time keeping up. The State Housing Minister, Jennifer Rankine, today joined other ministers in Adelaide to announce the latest statistics.

By the end of last month, 3351 South Australians had taken up the First Home Owners Boost, which in October was raised to $14,000 for existing dwellings and $21,000 for new homes.
"It's a great problem to have," Ms Rankine said. "There's so much building under way that we're worrying if we have enough builders."

Federal Housing Minister Tanya Plibersek said that the jobs created by the boom were crucial to riding out the world financial crisis. "We're talking almost a million jobs," Ms Plibersek said.
"We're keeping tradies and apprentices on the job, and putting people in homes." Ms Plibersek said that the South Australian uptake of the scheme compared favourably with other states.
Statistics from the Government show that South Australian home buyers accounted for more than 10 per cent of the 30,000 national applications.

David Pylyp; While other countries are investing in the real estate construction sector, in Ontario and specifically Toronto, in the last two years, we have added the additional Toronto Land Transfer Tax, on top of the existing Ontario Land Transfer Tax. Lot Levys (New Construction Levy) were under review for increase over four years in the City of Toronto and recently frozen due to the protest from developers. Licencing Fees for Landlords? This month the McGuinty government announced its intention to harmonize the goods and services tax with the provincial sales tax. As a result of this change, provincial sales tax will now be levied on legal fees, appraisals, real estate commissions, home inspection fees and other services related to a real estate transaction. OREA believes that this tax grab will severely hurt the resale housing market and reduce affordability for Ontarians trying to buy a home.

I encourage you to participate by clicking the following link so that you can also email your MPPS on this issue here:

Maybe we could learn a thing or two from our Australian friends. Have your say,

Your comments are always invited.

Trouble Making your Mortgage Payments?

CMHC Launches Campaign to Help Homeowners

Canada Mortgage and Housing Corporation (CMHC) launched a consumer outreach campaign to help borrowers understand the importance of working with lenders to find manageable solutions if they are facing financial difficulties in repaying their mortgage loans.

“CMHC has a long tradition of offering mortgage default management tools to lenders to help them assist homeowners whose financial circumstances have changed. We want to remind people that the best course of action is to speak to their lenders at the first sign of financial difficulty. With early intervention, cooperation and a well executed plan, you can work together with your lender to find a solution.” stated Mark McInnis, CMHC Vice-President of Insurance Underwriting, Servicing and Policy.

The campaign includes consumer information on the options available to homeowners who may be having difficulty meeting their mortgage payments. This information is also being provided to government partners and credit counseling organizations.

CMHC advises homeowners to:

  1. Talk to your lender at the first sign of financial difficulty
  2. Clarify your financial picture, both for yourself and your lender
  3. Stay informed about what options and resources might be available to you

For Approved Lenders with CMHC-insured mortgages, we provide tools and the flexibility to make timely decisions when working with homeowners to find a solution to an individual’s unique financial situation. These tools include:

  • Offering a temporary short-term payment deferral. Lenders may be prepared to offer greater payment flexibilities especially if previous lump sum prepayments have been made, or if an accelerated payment schedule has been previously chosen.
  • Extending the original repayment period (amortization) in order to lower the monthly mortgage payments.
  • Adding any missed payments (arrears) to the mortgage balance and spreading them over the remaining mortgage repayment period.
  • Offering a special payment arrangement unique to an individual’s particular financial situation.

More information and resources are available at CMHC’s website at search keywords “mortgage payment difficulties”, or at 1-800-668-2642.

David Pylyp; There is help available to you from professional people that can be consulted regarding potential refinancing options, deferral of payments.  Do not let more mortgage slip past due hoping things will improve. 

Home Energy Audit - Green Energy Act

If Ontario’s new Green Energy Act passes, Bill 150, You will be paying $300 for a home energy audit. This will be a tax only if you wait until you sell your home. The system will work in your favour if you do your audit now and make energy improvements.  

The home energy audit could be a good investment. Once your home energy audit is complete (up to 18 months), you will be on record and won’t need to pay for another audit when you eventually sell; probably years from now. The audit visit and blower-door test takes a few hours and the energy consultants are knowledgable. The resulting 13-page report details where and why your home is not energy efficient, makes suggestions for improvement and educates you about grants. That in itself is a lot of value for $300.

The province will match the federal grants in the ecoENERGY Retrofit program, so you will be getting back twice the rebates. You could rent or hire help to blow in bales of cellulose insulation into walls and attic. With both grants for which you now qualify, you will get back more than $1,600. Buying a few tubes of caulking to seal up cracks that were letting in cold air will get you another $300 in federal and provincial grants. 

You may need to replace your hot water heater soon and if you invest in an instantaneous gas water heater, you will get back another $500. And you will not have to fill out any forms to submit to either government.

The energy audit company does all the paperwork. You just sit back and wait for the cheques to arrive. 

The focus is how much you can expect to save on your energy bills as a result of upgrading your older home. Imagine, our government paying us to “go green”. And imagine the energy savings in the hundreds of dollars every year because you knew the problems to fix. 

You can bet potential homebuyers are more savvy and asking tough questions about energy efficiency. The old days of taking cheap energy for granted are over. In response to this, Royal Bank is offering a rebate on the cost of the Home Energy Audit for its Mortgage Clients.

Providing Value First; Contact David Pylyp in the west Toronto (GTA) for your buying or selling needs.

Thursday, March 26, 2009

Perfect Timing for Harmonized Tax Implementation

Well, it seems to be official. The Ontario Government has decided to harmonize the Provincial and Federal Sales Taxes.  July 01st, 2010 the tax Kicks in.

Stephen  Dupuis, president of the Building Industry and Land Development Association, pointed out that buyers of new homes would be hit particularly hard if Ontario harmonized the PST with the federal GST. See previous Posting 

On a $350,000 new home, he wrote that the consumer would have to pay an additional $17,920. But it's not just buyers of new homes who would be affected by a merging of the two taxes. Buyers and sellers of resale homes would also be hurt because a harmonized tax would apply to many services that are currently exempt from PST – including legal fees, real estate agent commission, renovation services, land survey reports, home inspections, landscaping and house cleaning services. Also affected would be the cost of labour for installations or repairs, including additions, kitchen renovations, driveways, roads, fences, swimming pools and patios. 

Assuming no change in the provincial sales tax rates, the seller of a $350,000 resale home would get hit with an additional $1,400 in tax on a real estate agent's 5 per cent commission, plus a new 8 per cent provincial tax on moving expenses, legal fees, accounting and bookkeeping fees, renovations, painting and other services which are currently exempt.

Ken Gaudet from the Canadian Taxpayers Federation is quoted as saying that according to their understanding, the Provincial Sales Tax will now permit the (additional) taxing of Gasoline.

So what will happen to buyers looking at a $ 350,000 property, condo or house, with their downpayment of 5%. Their current downpayment is $17,500.00.  As the tax would be applied to all construction, and CMHC fees, lawyers, title Insurance and including movers, Buyers could see a tax bill payable on their Mortgage Insurance fee Increase from  $865 to $1405. This brings the total closing costs on a resale home in the City of Toronto (combined with the Miller Bite) to a total of $8,870.00. (Ontario LTT $3725  Toronto Land Tax $2,200.) *Assumes that LTT rebates may not be available.

Now your total downpayment requirement is really $26,300.00

Let's get you purchased or sold prior to the implementation of the tax to make your dollars go further.Take advantage of the low interest rates!

Your comments are always invited. 

Tuesday, March 24, 2009

Interest Rate Bait and Switch

While hosting an open house, it is a standard question to ask prospects as they are viewing the home, "Are you under contract with an agent?"

One of the newest responses is that the "agent" is providing financing for a purchase a full percentage point lower than the lowest quoted rate I am aware of.

My first response was surprise.. That low?   How are they doing that?

Having been around for two decades I am familiar with interest rate buy downs that were very prevelant in the late 80's and early 90's. So I decided I needed to investigate.

I contacted the TD Bank Mortgage advisor and made the same request of the Royal Bank Mortgage Advisor. Called an independant Mortgage Broker and No One could touch or even come close to the quoted interest rate.

Maybe the consideration was blended mortgage averaging whereby 50 % of the mortgage balance would be in the (risk) variable rate calculation and the balance in the fixed rate portfolio. But that only brought me a half percentage closer to the quoted amount.

Further investigation of the asterik in the website's mortgage term was required. You know Nudge Nudge wink wink **   some conditions may apply.

Well...  Now a week later we finally have a few concrete answers. The interest rate is indeed one full percentage lower than today's rates.   So, for example a fixed rate mortgage of 4.22% could be had for as little as 3.38%. **    see the arterik?

But the interest rate is a teaser rate which contains an interest rate buy down for the first year term of a five year mortgage only.  None of the prospects I spoke understood the difference. They all assumed the rate was for the full five year period.

ING and HSBC also have interest rate teasers that induce you to take a mortgage with them. They are clearly marked as "low introductory rate" for [insert specified period] usually 6 months.  

With all the news in the media and a lack of consumer confidence in the economy, I do not agree with a Bait and Switch marketing program that leads people to a conclusion different from the Posted or Guaranteed Rates.  I have made an effort with my clients to present them with the best possible interest rates for their mortgage needs based on their credit worthiness. How would you like to be treated?

Once you have all the facts, the decisions are yours. You will be living with your choices.

From the US financing model these could be termed TOXIC loans.  Myself, I would prefer not to involve my clients or prospects in hidden fees or interest rate adjustments instantly after they move in.   They have enough on their plate with Land Transfer Tax's, rebates, First Time Buyers programs, and ultimately the selection of a home.

Lets not confuse people out there. Lets get them the best deal possible.

Monday, March 23, 2009

Living in a plastic world; Tips for managing your debt

In the early 20th century, Canadians had very little personal or consumer debt. Individuals mainly used cash to purchase products and services while universal credit cards didn’t even exist until the 1950s. In the early 1900s, banks would seldom lend money to middle and working class people so they rented their homes or paid for them as they were being built. This meant no mortgages, no lines of credit, no car loans, and no credit cards.

Most of us probably can’t imagine a life where we save up for years before making major purchases. In fact, according to the Canadian Bankers Association, there were 64.1 million Visa and MasterCard cards in circulation in Canada in November 2008. It’s safe to say that debt plays a large part in the lives of most young people these days – but that’s not necessarily a bad thing.

Good debt vs. bad debt

Debt is often made to sound like a bad word but in reality, low-interest loans that allow you to obtain a higher education or a place for your family to live can be a good thing. They make large purchases affordable to the average consumer. The problem lies in carrying high-interest-rate, non-deductible debt such as credit cards.

But what should you do if you find yourself drowning in debt?

First, let’s talk about what you shouldn’t do. You shouldn’t pay off your highinterest debt by using some of your Registered Retirement Savings Plan (RRSP) money. When you remove cash from your RRSP to pay a debt you’ll have to pay income tax on the money you withdraw, and you’ll forfeit the years of tax-deferred growth that would have contributed to your retirement lifestyle.

That being said, you must find extra money somewhere and here are a few tips to help you do so.

Consider a debt consolidation loan

Ask about combining or “consolidating” your debts into one loan that is used to pay off all your debts. In return, you make monthly payments on the loan at a lower interest rate. Then, you can use the extra money you have left over every month to pay down your debt even faster. Of course, while you are reducing your overall monthly payments, be aware that you may also be extending the length of time over which you are carrying the debt.

Budget, budget, budget

Take a critical look at your income and expenses. Do you know where your money goes every month? Small changes in your spending habits can yield big returns – and every extra cent you save can be used to pay down your debt. Remember to plan a budget reasonably. If your goals are too lofty, chances are you won’t stick to them at all.

Pay close attention at tax time

Another way to free up cash flow is to take advantage of every possible tax deduction and tax credit that may apply to you – including items like moving expenses, child-care expenses, tuition fees, medical expenses and charitable donations.

It’s true that the average household debt has increased during the last few decades; however, this doesn’t have to mean financial crisis for your family. By taking a serious look at your debt and finding small ways to reduce it, you can improve your financial situation and still save for your future. For more ideas on how to trim your debt, give us a call.

JOHN SCHOLL, B. Math, CGA, EPC   John's Home Page

Sunday, March 22, 2009

Secondary smoke is grounds for action by board

Q: Can anything be done about a heavy smoker if smoke is permeating the next-door unit? Second-hand smoke is a health hazard.

A: The number of second-hand smoke queries sent to me warrants revisiting this question.

The Condominium Act specifies that no person shall permit a condition to exist or carry on an activity in a unit or in the common elements that is likely to damage the property or cause injury to an individual. Injury must be considered as including injury to one's health.

A condominium corporation, under the act, has a duty to take all reasonable steps to ensure that the owners and occupiers of units comply with the act and with the corporation's declaration, bylaws and rules.

If the board is satisfied that second-hand smoke is entering the unit of a complaining occupant, it should demand that the offending owner take steps to deal with the issue, perhaps by limiting his or her smoking or confining it to rooms vented to the outside of the building. If the owner refuses to co-operate or if those steps do not solve the problem, the corporation may be obliged to instruct the owner not to smoke within the unit.

If necessary, the corporation should discuss a court application for a compliance order under section 134 of the Condominium Act with the corporation's lawyer.

David Pylyp; In a previous related post we also talked about a woman suing for damage to her suite by a tenant.  

Would the condominium board be able to PROVE it's case in a court of law?  Who would be responsible for the legal costs of mounting such an action?  How are cooking odours any different in the hallways from second hand smoke? 

Your comments are invited.

Toronto's "Hidden Jem"

South Etobicoke has a lot going for it, but dismal Lake Shore stretch tarnishes it  By ROB GRANATSTEIN

Councillor Mark Grimes' $2 tour of south Etobicoke starts with a million-dollar view from Eden Trattoria, one of the few lakeside restaurants in the city.

"Look at that view, it's phenomenal," Grimes said, sitting down for a meal of veal panini at the water's edge.

When waterfront planners want to show off a perfect Toronto setting, they should use this spot -- a fresh, modern restaurant with a patio that's jammed in the summer, overlooking the blue water of Lake Ontario, with Toronto's skyline close enough to touch.

In between, runners, in-line skaters and walkers use the paths and sidewalks to enjoy Toronto's shoreline.

In addition to the already completed buildings, applications for four more buildings on this stretch were filed this past December.

It's no wonder this is the start of a dizzying Grimes tour.

An hour later, we've zig-zagged through both the great, and the greatly disappointing, between the Humber River and Mississauga -- a tour Grimes has probably given 200 times.

It includes million-dollar homes featured in House and Home magazine, the new, nearly-complete four-pad Lakeshore Lions Arena, where the Leafs and Marlies will practice, the new police college, the growing Humber College, state-of-the-art industrial locations, two GO Train stations and brilliant vista after brilliant vista along the lake.

So much building has gone on in the past five years, Grimes keeps a collection of shovels from groundbreakings in his office.

But most of Toronto doesn't know much about south Etobicoke. We hear about the Beach and send tourists to walk the boardwalk and shop along Queen St. E.

And yet Etobicoke's shoreline has a better view and tons of parks, although it lacks the sandy beaches and the thriving retail stretch.

And don't call it Beaches West.

This hugely disappointing stretch of Lake Shore Blvd. is what Grimes is determined to bring to life, but is still largely dead.

The Etobicoke councillor is a master wheeler-dealer for his area, but this is one tough nut to crack.

While a few new stores and eateries have opened up, the strip is still a combination of horrible planning, lacklustre architecture and parking lots (not to mention a grow-op that caused a fire late last week in one of the buildings).

Grimes can't get people to walk up the street to dine at their local restaurants. Instead, they drive to Bloor West, Port Credit, Sherway Gardens or downtown. Goodbye Starbucks, hello dollar stores.

"The money is here," he said. "We just have to get them up from the shore."

Toronto Life just named Long Branch, the stretch east of Mississauaga, as one of the city's next hot 'hoods, featuring well-priced houses young couples are discovering and buying.

It also points out the stretch of Lake Shore Blvd. evokes memories of the Junction, just before all the organic grocers and fair trade cafes moved in.

Patricia Zisis chose Lake Shore Blvd. for her new restaurant, Kalamata, and is happy with the results, so far.

"I think it has lots of potential," said Zisis, who opened her doors four months ago. "I'm hoping people will say 'let's go to the Lakeshore for dinner.' It's not happening now.

"This area is a hidden gem, so close to downtown, so close to the highway."

Zisis said the locals are delighted to have another good restaurant and hopes others will follow.

David Pritchard, who co-owns Birds and Beans cafe and coffee roaster with his wife Madeleine, loves his Lake Shore location, near the water, but admits this is part of Toronto time forgot.

"It's quite isolated, and a lot of people don't know about it," Pritchard said. "We're trying to overcome the reputation there's nothing good on Lake Shore."

The 13,000 new residents in the new condos along Marine Parade Drive, at the east end of the ward, have the bucks to make Lake Shore Blvd. viable, but they don't make it far enough west to see what's going on. The lack of population density across the rest of the stretch is also problem.

"It's a bit of a fortress," he notes.

Rather than shopping locally, people drive away. The local businesses are working to overcome that.

The other barrier is that the waterfront's linear park doesn't connect the new condos to that part of the Lakeshore because a couple of buildings refuse to give up their lakefront land for the pathway. That stops bike and pedestrian traffic -- and leaves a couple of parking lots steps from the lake.

That's the awful Toronto of old.

To make the $2 tour sparkle, Grimes needs a little help from residents and from businesses that believe this is a gem waiting to shine.


David Pylyp There will be a noticeable improvement in pedestrian and vehicle traffic with the new Lakeshore Rail Transit improvements from the TTC.  Hope fully the final opening of the Mark Goodman Trail will bring people further out to the west end and connect with the waterfront in Longbranch and Port Credit.

Saturday, March 21, 2009

Toronto proposing property tax relief for elderly, disabled

Toronto is trying to spread the word about the property tax relief for low-income seniors and the disabled proposed in the 2009 operating budget.

While the programs have existed, city manager Joe Pennachetti said there hasn’t been much take-up in the past and Toronto wants to make sure those eligible are aware of the help being extended. Contingent on council approval of the budget, the city wants to enhance both it’s property tax cancellation and deferral programs.

Households with an income of $30,000 or less living in a home with an assess value of under $525,000 can apply to have their property taxes cancelled.

That’s up from a household income of $26,000 or below in a dwelling of less than $464,000, which was the criteria last year.

Mr. Pennachetti said the city wants to sweeten the program by 15%, so 19,150 Toronto households can qualify in 2009, up from 16,750 last year.

But he said the offer was only taken up by 20% of eligible seniors and disabled people last year. (Families or individuals in similar situations who are under-age 65 and who are able-bodied do not qualify.)

The take-up for the interest-free property tax deferral program was only a paltry 1-2% last year, Mr. Pennachetti added.

This year the city wants to expand eligibility to 82,000 households with an income under $50,000, up 35% from 62,000 households with an income below $40,000 last year.

The city will be sending out a brochure about the program enhancements when property tax bills are mailed out in May – as long as the measures receive council approval at the end of this month.

Related Posts: Reassessment + shifting of property tax burden = 4% hike for homeowners by Allison Hanes

Thursday, March 19, 2009

February Inflation Rises to 1.4%

Canada's annual inflation rate rose in February to 1.4 per cent from the 1.1 per cent rate seen in January, Statistics Canada reported Thursday.

Economists had been looking for 12-month inflation to cool a bit to one per cent for February.

Higher prices for food and shelter were the primary reasons for the increase, Statistics Canada said.

Food prices increased 7.4 per cent during the 12-month period to February, following a 7.3 per cent increase in January. The main contributors to the overall jump in food costs were a 25.8 per cent hike in the price of fresh vegetables, a 9.7 per cent rise in the price of bakery and cereal products, and a 6.1 per cent increase in meat prices.

Shelter costs, the second-largest factor, increased 3.0 per cent, which was slightly less than the 3.3 per cent rise in January.

Holding inflation back was a year-over-year decline in the price Canadians were paying at the gasoline pumps. Gasoline prices in February were 19.7 per cent below levels in February last year.

Excluding gasoline, the annual inflation rate rose 2.5 per cent in the 12 months to February.

The Bank of Canada's core inflation rate — which factors out many volatile influences and is used by the central bank for the purpose of setting monetary policy, such as lending rates — advanced 1.9 per cent over the 12 months to February, identical to the increase posted in January.

David Pylyp: With declining prices in real estate, and all the talk of recession, many of the talking heads on TV (Media) are discussing deflation.  Things should be going down in price in a recession. During a recession, there should be no inflation, as we are in recession. the Bank of Canada usually increases interest rates to combat inflation. Right?

Yet here are the same people discussing the fact that although real estate values are down slightly in Toronto, vehicle prices are down, the financing options, product availability and pricing make this a good time to buy large ticket items.

What I do see happening, is a strong pend up demand from buyers that still need a place to live in Toronto and are continuing with their property search albeit carefully and with a little more prudence. Neighbourhood and indeed condominium complexes are becoming more balanced in pricing as buyers compare square footage, amenities and neighbourhood localism.

Your comments are always invited.

Wednesday, March 18, 2009

Save or Spend your Tax Refund?

What could be better than getting a tax refund?

The answer is - not getting one. You see, a tax refund cheque is not a gift from the Canada Revenue Agency (CRA). It’s money you overpaid during the year that you are now getting back – but without interest.

You could spend it – it is yours after all. Or you could explore some other options including making that money grow and not getting a refund next year. Here’s how:

Make your 2009 RRSP contribution right now. You get the benefit of almost an extra year of potential long-term RRSP tax-deferred growth, plus a tax deduction against your taxes next year.

Contribute to a TFSA. Starting in 2009, you are able to save up to $5,000 a year in a Tax-Free Savings Account, or TFSA. While the contributions are not tax-deductible, you will not be taxed on any of the investment income generated by the TFSA. As well, the tax-free withdrawals can be re-contributed to the TFSA in a future year.

Increase your non-registered investments. If your RRSP and TFSA are topped up, add to your non-registered investments. Plan to hold stocks and equity mutual funds outside an RRSP or TFSA because any gains on these investments are taxed at the more favourable capital gains inclusion rate. As well, Canadian dividends received from these types of investments qualify for the dividend tax credit.

Get a grip on education costs. Establish a Registered Education Savings Plan (RESP) to fund your children’s future education costs. RESP contributions are not tax deductible, but their growth is tax deferred and they qualify for Canada Education Savings Grants* of up to 20 per cent of your contribution.

Pay down your most costly debt. The interest on credit card debt often ranges from 15 to 29 per cent so you should reduce or eliminate that debt first.

Pay down your long-term debt. Once you’ve taken care of your high-cost debt, pay down non-deductible debt such as your mortgage. A pre-payment will chop months or years off your repayment schedule and could save you hundreds or thousands of dollars in interest payments.
Park your refund for a rainy day. If your refund is large, park some cash in a short-term investment where you can access it without penalty. You’ll have a ready source of cash for a new car or emergency home repairs without having to borrow or use your credit card to meet unexpected expenses.(Some individuals may use the TFSA for their emergency fund).

Eliminate next year’s refund by having less tax withheld from your paycheque. You’ll have a little more money for your own use every pay period. To lower your withholding tax, use File Form T1213, available from your local CRA office or from the CRA Website,

With the right tax strategy, you won’t necessarily get a refund cheque but you will get the most out of what you earn and invest. Talk to your professional financial advisor to find out what works for you.

John Scholl B. Mathematics, CGA,
Wealth Management & Financial Planning

I strive to continually improve my wealth management practice to be worthy of the referrals received. I build my business one introduction at a time, and would consider it a great compliment to be introduced to one of your business associates, friends or family.

Investors Group 200 - 24 Queen Street East, Brampton, Ontario L6V 1A3
(905) 450-2891 X529 (866) 799-2223 (416) 731-3660

Sunday, March 15, 2009

Chicago Home sellers will need to be finger printed

To help combat real estate fraud the city of Chicago is requiring starting June 1st that homesellers provide a fingerprint.

With rampant fraud occurring in the city, this is not a bad idea. But being a libertarian, the idea of a government official taking my fingerprint disturbs me. I would like to see that these fingerprints be destroyed after a period of time.

Fingerprinting is something we often associate with crime. So the fact that Cook County home sellers will soon have to provide a thumb print left some people shocked.

“I wouldn’t like that at all. I don’t think that’s necessary,” said Chicagoan Donald Hayes.

“I don’t know what I think about that. Not very good, I think, said Jenny Armstrong of Lake Villa.

The new law, which is set to go into effect June 1, 2009, will force anyone selling property in Cook County to provide a thumbprint from their right hand. via CBS2 Chicago

From the comments section;
Comment by Curtis Van Carter on 15 March 2009:
In California they have been requiring a thumb print for notarizing a deed of trust for about 4 years and just upped the requirement to any document regarding real estate this year. I don’t remember the stats, but it eliminated the vast majority of fraud as to those seller something they didn’t have the right to. The other commenters may be right about the civil rights part of this, but being a notary, there have never been a complaint!

David Pylyp Given the potential for fraud and the abuse of Power of Attorney documents, and the cash tenants that sell your house while you are not looking; I can see this type of technology coming to the Toronto (GTA) in the very near future.

What are your thoughts?

Friday, March 13, 2009

Home Renovation Tax Credit - Tango Kitchens

The recently announced Home Renovation Tax Credit may be of interest to people considering the renovation or upgrade of their kitchen. The kitchen is not only the focal point for all your family gatherings but is the most identified feature about your property that buyers are looking at when considering your home as a purchase.

I recently came across a business, Tango Kitchens, in Woodbridge that is using the Home Renovation Tax Credit to their advantage. They are offering to match the Tax Credit as a rebate to those who are hesitating to spend money to improve their homes.

The Rebate is for a limited time only.

Tango Kitchen's has a spacious and well displayed showroom if their kitchen cupboards, styles and trim, in addition to many counter top (granite and others) selections. There is an exquisite example of old world craftsmanship with the bullnose edging on their island in granite display that just does not appear to its potential in a short "videotorial". The showroom is conveniently located at Highway 427 immediately at the Highway 7 exit.

I invite you to contact Jagdish Bajaj Tango Kitchens to have a quote for your new renovation and tax credit.

Creative people with innovative marketing programs will thrive in this economy.

Thursday, March 12, 2009

First Time Buyers Eye Bargains

Skittish purchasers still cautious, ReMax says, but new affordability spurs fresh interest

If there is an upside to a recession, it's the inevitability that stuff gets cheaper.

Falling home prices may be hard on developers, but they can spark opportunity for first-time buyers – if the price is right.

According to figures released yesterday by Statistics Canada, Canadian new home prices declined by 0.8 per cent in January from the same month a year earlier, the first year-over-year decrease since January of 1997.

"Years of frenzied construction activity had left the market overdue for a correction," said Valerie Poulin, an economist with the Conference Board of Canada, in a report yesterday. "With demand for new homes waning across Canada due to poor economic conditions, the market drop off appears to be more severe than expected."

Declining housing starts will cut builders' profits by almost 20 per cent this year, to $3.2 billion, according to a report by the board. Residential construction industry growth is also expected to fall drastically, recording the biggest decline since 1995.

"Consumers are postponing expenses such as renovations or buying a home," the Conference Board said. "Tighter credit conditions are further dampening demand."

With prices falling, buyers in the existing home market can find detached homes for what some Toronto homeowners spent on their kitchens during the boom years. Prices start as low as $75,000 in Windsor, $119,000 in Niagara Falls and $125,000 in St. Catharines – the top three cheapest cities for first-time home buyers identified by a ReMax Ontario Atlantic Canada report yesterday.

"You're not getting the Ritz at these prices, and a lot will need some elbow grease, but they will be liveable first-time properties," real estate investor Mike Sergeant said.

An ailing auto industry in devastated Windsor means average prices have dipped 10 per cent this year alone. Buyers seeking entry-level homes can find houses for $75,000 in Windsor's East and Central neighbourhoods.

"While skittish purchasers remain cautious ... there are those who are venturing into the market," ReMax said.

And the price of entry is remarkably low: There were 24 sales under $60,000 in the downtown core. One property sold for $25,000.

"Affordability has greatly improved and buyers are firmly in the driver's seat in just about every market surveyed," said ReMax executive vice-president Michael Polzler.

Though affordability is improving, it's another thing to convince first-time home buyers to commit when they think housing prices are set to fall further. The Canadian Real Estate Board is forecasting an 8 per cent drop in home prices by the end of this year.

During the last quarter of 2008, first-time buyers "largely checked out," said Royal LePage CEO Phil Soper. "They're sitting at home, or renting. They don't have to buy."

However, as affordability improves, Soper expects first-time buyers to return in increasing numbers this year. In the Toronto market, almost 50 per cent of all February sales occurred under the $300,000 price point, compared to 43 per cent a year ago.

First-time buyers who are secure in their jobs are still favouring condos priced in the $200,000-plus range, despite warnings the sector may be overbuilt.

Detached homes in the city's east end start at $350,000 and are still out of reach for many. Starter detached homes in the city's central core start at $550,000.

While supply is up across the board, with a 19 per cent increase in listings, there is more demand in the lower end of the market.

With home prices and starts falling, builders are concerned about an Ontario Chamber of Commerce initiative that calls on the province to blend the provincial sales tax and Goods and Services Tax into a single tax. The chamber said streamlining could save $100 million.

That didn't sit well with developers, who shot back yesterday in a report by housing economist Frank Clayton for the Building, Industry and Land Development Association. Clayton concludes harmonization would result in a $46,676 increase in tax on an average new home in Toronto. "The adverse consequences ... would be excessive," he said.

David Pylyp The graph pictured about pretty well sums up the entire article. If you are in good shape financially, lending practices have not changed or been restricted. Mortgage Blending of fixed and variable rates can help reduce your debt faster than the allowed 35 year maximum.

Call for an appointment to get you started. Rebate Programs Available.

If you want your property profiled to first time buyers, give me a call to show you what can be done.

Wednesday, March 11, 2009

Addictions to Toronto Real Estate Porn

I must admit that even in my spare time I am looking for the ultimate voyeuristic thrill, almost hearing the voice of "Lifestyles of the Rich and Famous" and Robbin Leach.

Leslie Roberts recently ran a piece in the National Post about his visions of and endless hours of self indulgence.

I can across just such a trill that I must share.

Toronto's Tallest building is currently the highest construction of a North American residential condo complex. This 75 storey structure located at the corner of Yonge and Gerrard will comprise two separate condo corporations contained with a single vertical structure.

Property Details.

The Addiction for me is the 11,000 square foot Penthouse with 360 degree views of downtown Toronto, no decision about north, east, south or sunset views.

Imagine my surprise when I came across a 2140 square foot penthouse remaining at the Collee Park II complex that has a west and south view from the 46th floor. I just have to share that as well. Details

Maybe you would like to share where you made your purchase choice, when you will be moving in or What was the final criteria for your choice?

Your comments are always welcomed.

To view this prestigious suite on the 46th floor give me a ring and we'll schedule an appointment.

Monday, March 9, 2009

Bill 150 Home Energy Audit

Bill 150 targets long-suffering homeowner

Imposing mandatory energy reports will further depress prices and sales volumes
If it was the intention of the Ontario government to do as much damage as possible to the Toronto real estate market, then it has succeeded admirably in its goals. In fact, it has also succeeded even if that was not its intention.

First came the new City of Toronto Act, which allowed the city to impose the dreaded municipal land transfer tax.

Effectively doubling the provincial land transfer tax, the "Miller Bite" acted as a tsunami of ice water on Toronto's previously healthy real estate market.

Home sales have gone down every month since the tax came into force last year.

Next came Premier Dalton McGuinty's announcement in January of this year that the government is taking a "long hard look" at implementation of a harmonized sales tax, which would see provincial tax imposed on many items which are currently exempt.

If it is approved, buyers and sellers would have to pay provincial sales tax on newly built homes, legal fees, real estate commission, renovation services, land survey reports, home inspections, repairs and improvements.

Now comes the third blow to the real estate market – Energy Minister George Smitherman's proposed legislation to require an energy audit for residential units.

Bill 150, the Green Energy and Green Economy Act, 2009, would make an energy audit compulsory for the sale and some leases of every residential property in Ontario, including houses, apartments, and condominiums. The proposed audit would report on the "energy consumption and efficiency" of a residence.

Commercial, agricultural, institutional, educational and industrial properties are all exempt. The government's message, of course, is that energy conservation applies only to residential properties and not businesses.

The introduction of mandatory energy audits marks a government intrusion into the free marketplace, which is unprecedented in Canadian history.

No government in this country has ever required mandatory inspections of any home component at the time of sale.

I find it strange that the government wants to impose energy audits, but not mandatory inspections of house components, which can be matters of life and death, such as propane storage tanks, carbon monoxide leaks from furnaces, significant non-compliance with building codes, or dangerous electrical panels.

Frankly, it makes me question the government's motives in all this.

At present, energy audits are optional and I have yet to have a client perform one on his or her house purchase.

Obviously, the federal and provincial governments have done a poor job of promoting their availability or desirability.

I'm told there are only about 450 federally licensed energy auditors for the whole province.
The government's announcement implies that there are not enough of them.

What happens, I wonder, in the meantime, when housing sales come to a standstill for lack of an energy auditor? Who polices this profession? Are the auditors adequately trained, insured, and regulated?

Many of the areas in a house that will be examined by the proposed mandatory energy assessment – such as the insulation, windows, and furnace – are already examined in standard home inspections, so the Smitherman proposal is a needless waste of resources.

I believe that imposing mandatory energy reports will further depress prices and sales volumes. Purchasers will use the assessments to drive prices down and simply pocket the resulting "discount" without doing any of the recommended work.

Properties built in compliance with the government's own Building Code in recent years will still require a new energy audit which, in my view, would be a complete waste of time and money.
If Smitherman truly wanted to encourage energy conservation and efficiency, he would adopt a meaningful program of incentives, education and encouragement – and make it apply across the board to commercial and industrial real estate as well as residential.

Bill 150 only targets the long-suffering homeowner. It just doesn't make sense.

Bob Aaron is a Toronto real estate lawyer and a director of the Tarion Warranty Corporation. He can be reached by email at, phone 416-364-9366 or fax 416-364-3818. Visit the column archives at for articles on this and other topics.

Apartment Building Evicts Tenants

No, this is not in Ontario, or even Canada.

But this is a huge example of the different protection that is offered to Tenants in both rental units and condominium owners in situations where the Landlord/ Building is in mortgage default.

I would be very surprised to see a situation like this in Toronto.

We love to hate government control but the Rental Tribunals and Banks follow Canadian law which is built on the concept of precedent (previous historic decisions).

Maybe thats why we have so few situations (less than 1% default on mortgages) that make the news in this fashion.

Your comments and contributions are appreciated

Thursday, March 5, 2009

Market Observations Toronto Real Estate

While everyone is concerned about job losses and the declining number of sales a curious thing is happening.

Greater Toronto REALTORS® Reported 4,120 Resale Housing Transactions in February

March 05, 2009 -- Toronto Real Estate Board Members reported 4,120 sales in February 2009 compared to 6,015 sales recorded in February 2008. The average home price was $361,305 last month compared to $382,048 during the same month last year.

That's not a very long banner.

BUT the details are what is interesting;

In the West section ( that I serve) Last year Feb 08, we had 7,359 listings with 2,358 sales. A ratio of approximately one in four that sold or 32.04%

This Feb. 09, we had 7,944 listings with 2544 sales. A ratio of approximately one in four that sold or 32..02%

Complete table for last 14 month period of West Toronto Sales.

There are two vastly different perspectives I wish to draw your attention to;

While everyone is screaming at the top of their lungs that things are bad, it is exactly as it was statistically as was last year at this time.

The number of available listings and the number of sales during that month period are almost identical.

There has been no dramatic increase in the number of for sale signs, There have been no huge upswings in Power of Sales or foreclosures, and indeed families are not living in the streets.

Yes, it would apprear that the average price of homes has trended slightly downward; but if eleven Million dollar homes sold into that same average calculation the numbers would be displayed (spin would be different). The headline I heard tonight was average homeowner lost $20,000.

OR the sold prices are averaging 5% difference from last year. Which headline sounds better to keep you on the edge of your seat?

Complete Download of the Market Watch Report is available here

While out in Markland Wood this past Wednesday with Steven D'Sousa, CBC Videographer, I was asked "Where are all the For Sale Signs?" I tried to explain, that in mature (40 + Years) neighbourhoods there are an average of 3.7 to 4.2% of homes sold in any given year. Given that ratio, a given neighbourhood will have only 37 to 42 listings in one year. Those buyers that want these desireable locations in the west end of Toronto, will decide to buy them or wait.

When asking prices are adjusted (reduced) they will at some point find a buyer. We are currently in a buyer's market with Purchaser's being able to negotiate incredible deals. This may change while the talking heads and pundits are bickering on the evening news and in the fall you may see a change in the ratios. By the time you realise the change your negotiation opportunity has passed you by.

If you are considering the sale of your home in west Toronto / Etobicoke / Mississauga I would like to hear from you. Contact me at 647 218 2414.

My money is still on real estate, I would never fit into a safety deposit box.

Home Renovation Tax Credit Update

In a recent conversation with Henry Kordowski Tax Accountant (he) brought to my attention the fact that condominium owners are also eligible for the Home Renovation Tax Credit.

The units, condominium suites, in older buildings will have a component from the maintenance fees that are allocated to capital improvement and renovations.

So.. In fact, the maintenance fees that are applicable to the inprovement portion would thereby become deductible.

"When preparing the tax returns, Condominium owners may not realise they are entitled to deduct a portion of the maintenance fees, into bnext years tax return." Henry Kordowski said in a recent interview.

Henry Kordowski is a Tax Accountant in the Bloor west Village neighbourhood and may be contacted at 416 767 7554

Wednesday, March 4, 2009

RBC study finds home purchasing intentions rebound

Majority say it's a buyer's market

HALIFAX, March 4 /CNW/ - Homebuying intentions in Atlantic Canada have increased over last year surpassing 2007 levels, according to the 16th Annual RBC Homeownership Survey.

The poll found that 25 per cent of Atlantic Canadians were likely to purchase a home within the next two years, up from 20 per cent in 2008 and 24 per cent in 2007. "We're likely to see increased home buying activity in Atlantic Canada over the next two years, with purchase intentions springing back from last year," said Craig Bannon, regional manager, Mortgage Development RBC.

"The change in sentiment may be due to more favourable mortgage rates and housing prices, which have many in the region convinced it's a buyer's market."

The survey, conducted by Ipsos Reid, found that a majority (58 per cent) believe it is a buyer's market right now. Given current housing prices and economic conditions, most Atlantic Canadians (56 per cent) believe it makes more sense to buy now, rather than wait until next year.

An overwhelming 84 per cent of those polled in Atlantic Canada said that buying a home is a good or very good investment. On average, homeowners in the region approximate the value of their home at $181,555. They also estimate that the market value of their homes increased by 14 per cent over the last two years.

Among those who plan to purchase this year or next, 26 per cent said they will do so because their current home does not meet their needs. Sixty-four per cent said they plan to purchase resale and most (84 per cent) will opt for a detached house. Future Atlantic Canadian homebuyers also said that environmental considerations would weigh on their purchase decision.

Almost all respondents (98 per cent) indicated that buying a home with low energy consumption was important to them and 82 per cent said the same about environmentally-friendly features. Further, 94 per cent of those surveyed were interested in having standardized energy ratings for their homes.

Regional Differences

Own a home
67% 69% 69% 70% 68% 60% 67%

Percentage of homeowners who have a mortgage
61% 56% 46% 62% 64% 66% 60%

Percentage who believe it is a buyer's market
65% 78% 72% 34% 73% 52% 58%

Owners and renters who are 'likely' or 'very likely' to purchase a home in the next two years 27% 26% 35% 25% 30% 22% 25%

Believe mortgage rates will be higher in one year's time
33% 28% 26% 35% 33% 33% 46%

Believe housing prices will be higher in one year's time
25% 20% 23% 27% 26% 25% 36%

Believe buying a home is a good investment
83% 81% 86% 83% 84% 79% 84%

Homebuyers planning to purchase a detached home
68% 76% 63% 63% 69% 60% 84%

Homebuyers planning to buy a bigger home
47% 42% 40% 69% 52% 49% 20%

Homebuyers planning to buy a resale home
74% 83% 71% 60% 76% 75% 64%

Homebuyers planning to buy a new home
26% 17% 29% 40% 24% 25% 36%

These are some of the findings of an RBC poll conducted by Ipsos Reid between January 6 and 9, 2009. The online survey is based on a randomly selected representative sample of 2,026 adult Canadians. With a sample of this size, the results are considered accurate to within +/-2.2 percentage points, 19 times out of 20, of what they would have been had the entire adult Canadian population been polled. The margin of error for residents of Atlantic Canada is +/-7.8 per cent (N(equal sign)160) and the margin of error for Atlantic Canadian homeowners is +/-9.4 per cent (N(equal sign)108). The margin of error will be larger for other sub-groupings of the population. These data were statistically weighted to ensure the sample's regional and age/sex composition reflects that of the actual Canadian population according to the 2006 Census data. For full tabular results, please see the Ipsos Reid website at 03/04/2009 /For further information: Lori Smith, RBC, (902) 421-8121; Sean Simpson, Ipsos Reid, (416) 572-4474/ (RY RY.) CO: RBC; RBC Royal Bank ST: Nova Scotia IN: FIN SU: SVY

David Pylyp Not only does the survey reflect my own feelings and experience with the market, it bares out the response that I have had, in the last month, at open houses and with clients when out shopping. There is a definite sense of renewed optimism.

I was contacted by Steven D'Souza, a Video Journalist with the CBC News at 6, in Toronto, to share my views about the market. In the half hour to forty five minutes we spent together answering his questions, I look forward to see the show will be edited and how the video will display when paired down to one minute and thirty seconds.

Does this count towards my 15 minutes of fame?

Tax Preparation is NOT tax planning

Here comes that dreaded tax filing deadline – and maybe a late night of tax preparation along with it. But don’t confuse your last minute tax prep dash with real tax planning.

Tax planning means taking the right financial steps throughout the year to reduce the taxes you pay. And the time to start is now – using strategies like these:

Keep a record. Use home finance or tax preparation software to track finances for tax purposes. If you don’t have a computer, use a good filing system.

Plan now to make your maximum RRSP contribution for 2009 and beyond. A Registered Retirement Savings Plan (RRSP) is the biggest tax break available to most Canadians. The sooner you get your cash into your RRSP, the longer it has to grow.

Add a spousal RRSP. Whether married or common-law, if one of you is likely to generate more income in retirement, the other should consider contributing to a spousal RRSP – a strategy that can equalize income streams during retirement and lower your combined income tax bill.

Initiate an investment strategy that takes taxation levels into account. Some types of investment income, such as capital gains and dividends, receive preferential tax treatment, while others, such as interest, are taxed at normal rates. Hold heavily taxed investments in an RRSP, where they will grow on a tax-deferred basis. You should also consider investing in a Tax-Free Savings Account that allows your after-tax investment to grow without further tax liability being incurred.

Invest child tax benefit payments in the child’s name. The income earned will then be taxable in the hands of the child, who may not have enough income to generate a tax bill.

Consider borrowing for business or investment purposes. The interest may be tax deductible.
Set aside money to make quarterly personal income tax payments on time. Lateness can result in penalties and interest. Installments are due the 15th of March, June, September and December.

Don’t get a tax refund. A large refund means you’ve loaned your money to the government interest-free. Request a reduction in taxes withheld at source.

If you expect a refund this year and are confident the same thing will happen next year, you can apply to have your employer reduce the amount of tax deducted from your paycheque.

When you were first hired, your employer had you complete a Personal Tax Credits Return form (TD1) that included all the deductions and credits you normally claim in a year. If your circumstances have changed since then, making you eligible for additional deductions (child care expenses or spousal maintenance, for example), your taxable income and your tax bill will be lower now. So reduce the amount withheld from your paycheque each month by filing a T-1213 form. (Available from your local CRA office or from the CRA Website,

Are you turning 71 in 2009? If so, you must wind up your RRSP by December 31. Be sure to investigate your retirement income options well in advance, otherwise you could end up paying a huge tax bill.

Planning to move to a province with a lower tax rate? Make it by the end of the 2009 and you’ll pay taxes for the entire year to the province in which you live on December 31.

Tax planning reduces the taxes you pay. Financial planning makes it possible to achieve your life and retirement dreams. Discuss these and other steps with your professional advisor.

John Scholl B. Mathematics, CGA,
Wealth Management & Financial Planning
I strive to continually improve my wealth management practice to be worthy of the referrals received. I build my business one introduction at a time, and would consider it a great compliment to be introduced to one of your business associates, friends or family.
Investors Group
* Tel. : (905) 450-2891 X529
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Tuesday, March 3, 2009

Will you rent that condo? Who do you tell..

Great! Now you have possession of that condo.

You will be paying phantom rent (Mortgage) until the unit is registered, so you are considering placing a tenant into the property for a few years to pay it down.

That seems easy enough, but there are some other practical and legal considerations.

Stan Gelman is a local lawyer for Etobicoke and Mississauga. Stan can be reached at 905 270 5110 or through his website

Your comments and remarks are appreciated and respected.

Flipping Condos in Toronto

So many people have bought condos that are not yet built, and are trying to flip them by assuming they can merely assign the contract from the builder.

Yes, there may be an assignment fee but there are other considerations.

Stan Gelman is a local lawyer for Etobicoke and Mississauga. Stan can be reached at 905 270 5110 or through his website

I welcome your comments and questions.

More about Pets in Toronto Condos

This topic is gaining a readership of its own.

Please feel free to add or share your stories to the comments section below. I would appreciate hearing from you.

Stan Gelman is a local lawyer for Etobicoke and Mississauga. Stan can be reached at 905 270 5110 or through his website