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Archive for the ‘Taxes’ Category

A silver lining during the holiday season

Wednesday, December 22nd, 2010 by Dan Cooper

Talk about lousy timing for depressing news. Just as consumers are flocking to the stores to do their Christmas shopping, Bank of Canada governor Mark Carney came out with a stern warning that Canadians are too far in debt. He says that household debt is so high that if there was an interest rate hike, consumers would buckle under the load.
Personally, I don’t see any reason to be an alarmist. Yes, people have been spending, but they have also been saving over the past two years. The economic meltdown in the U.S. gave us all a scare and practically halted our own economy to a standstill.

It was refreshing, therefore, to see the recent remarks by Douglas Porter, deputy chief economist with BMO Capital Markets, who said that while household debt has been “rising relentlessly,” so too have household assets. Porter calls for calm. “This singular focus on the debt side of the balance sheet really overlooks the very clear improvement under way that we’ve seen on the asset side of the ledger for the past year or so. When you take this into account, Canadian household finances are not nearly as stretched as commonly perceived.”

He said Canadians have invested rather than just spend, and most of that investment has been in real estate, thereby increasing assets. In fact, Canadians are worth more than they used to be, he says. He rightly cautions that to scare consumers into closing their wallets would be dangerous. Such action would put a serious drag on our fragile economy, which is gradually improving.

Of course, Ontarians were hit with a double whammy this year. In addition to the recession and a shrinking manufacturing base, we also had to contend with the Harmonized Sales Tax (HST), which was introduced in July. Here in Oakville, the impact on our property values were further exacerbated by the controversial power plant proposal which scared off potential buyers.

But we are recovering. Consumers are getting used to the HST and the province wiped the power plant proposal off the drawing board. I’m confident that with all this turmoil behind us, the housing market in Oakville will be booming this coming spring.

It’s a good time to start looking at properties for your next move and remember to work with a broker who knows the community and has established successful selling strategies to ensure you sell your home for top dollar – fast. In the meantime, all of us on the Dan Cooper Team wish you a happy holiday and the very best for 2011.

Dan Cooper is an award winning Broker with Royal LePage Real Estate Services Ltd., Brokerage – the Number 1 Royal LePage Team for Canada in 2009. He can be reached at 905.338.3737, direct line at 905.849.3303 or through his innovative and interactive website at DanCooper.com. Be sure to catch the Dan Cooper Real Estate Series on DailyWebTV.com. For his free booklet How To Sell Your House For Top Dollar – Fast! or his Guide to Oakville Real Estate, please call the Dan Cooper Team.

Posted in Finances, HST, Interest Rates, Mortgage, Statistics, Taxes | No Comments »

Blame the decline in home sales on the harmonized sales tax

Wednesday, August 25th, 2010 by Dan Cooper

As predicted, the pace of home sales slowed in July as consumers adjusted to the new harmonized sales tax. Coupled with the fact that interest rates were rising, the rush to buy homes prior to the HST coming into effect on July 1 resulted in an overheated market in May and June. But this current slowdown in the market is expected to be short lived.

Earlier this month Jeff Mahannah, President of the Oakville, Milton and District Real Estate Board, said, “Sales transactions are down for July, but overall for the year-to-date we are on par or are observing a slight increase in transactions when compared to 2009. What I anticipate, once the public has time to adjust to the HST and realize that interest rates are still affordable, is an increase in activity in sales transactions in September.” This is what he is talking about. Last month residential sales for Oakville were down by 48 percent compared to July 2009 and the average sale price – $505,999 – decreased by 0.2 percent. However, year-to-date sales were still up by 5 percent and the average sale price was up by 13 percent.

In Burlington, the story is quite similar. “July was certainly a quiet month for sales,” said Joe Ferrante, President of the Realtors Association of Hamilton-Burlington, “but it was not at all unexpected. Despite the slower sales in July, our year-to-date sales are still up 10.7 per cent over this time last year.” The average price of freehold residential properties sold in Hamilton-Burlington in July was $329,317, an increase of 5.5 per cent over July last year. In the condominium market the average price of condominiums in July was $237,304, an increase of 1.6 per cent over July 2009. “We have a good inventory of listings,” Ferrante explains, “which makes Hamilton, Burlington and our outlying areas such a great place to buy real estate right now.”

Whether it is a slow market or an overheated market, each brings particular challenges of their own and the key to making the best deal possible is to work with a broker who has a proven track record and is a consistent top performer – someone who you are confident will be able to sell your home quickly and for top dollar. Innovative marketing and investment, knowledge about the marketplace, commitment and exemplary service differentiate the Dan Cooper Real Estate Team. The result is that we are achieving accomplishments that illustrate the Dan Cooper difference. We are the Number 1 team in Canada for Royal LePage, which is a testament to our ability to sell homes fast in the Oakville and Burlington areas. In fact, we have been the Number 1 team for seven of the past ten years. We were also named Best Real Estate Agent and Best Real Estate Team in North Oakville Today’s annual Readers’ Choice Awards. The Readers’ Choice Awards are as grassroots as you can get, and being named Number 1 for both agent and team are proof that we are having a significant impact right here in our own community.

Dan Cooper is an award winning Broker with Royal LePage Real Estate Services Ltd., Brokerage – the Number 1 Royal LePage Team for Canada in 2009. He can be reached at 905.338.3737, direct line at 905.849.3303 or through his innovative and interactive website at DanCooper.com. Be sure to catch the Dan Cooper Real Estate Series on DailyWebTV.com. For his free booklet How To Sell Your House For Top Dollar – Fast! or his Guide to Oakville Real Estate, please call the Dan Cooper Team.

Posted in Burlington Real Estate, Finances, HST, Oakville Real Estate, Real Estate, Real Estate Market, Taxes | No Comments »

Get the best price for your home during a slowdown

Friday, July 30th, 2010 by Dan Cooper

Canada’s residential real estate market will start to slow in the second half of 2010 after two quarters of strong price increases and sales activity, according to the most recent Royal LePage House Price Survey and Market Survey Forecast. While sales activity was strong in the first half of the year, it is expected to cool off for the third and fourth quarters with prices flattening.

This is how Phil Soper, President and CEO of Royal LePage Real Estate Services Ltd., Brokerage, explains the situation: “We have seen an unusual pattern of activity in the housing market over the past 12 months, with the market experiencing a surge of activity and price increases that peaked in the fall of 2009 rather than spring. Early 2010 followed a more typical seasonal pattern with prices and activity peaking in the second quarter. An expected increase in the supply of homes on the market will now bring stabilization in prices and in some cities we will see both prices and unit sales decline towards the end of the year. This should not be interpreted as a severe correction but rather a natural reaction to the market having peaked quite early this year.”

The surge of activity in the first half of 2010 in Ontario was prompted by a number of factors, including an increase in interest rates in the spring, tightening of mortgage lending rules for first-time homebuyers and investors, and the lead up to the introduction of the HST. In June, residential resales in Oakville were down by 34 per cent compared with June 2009, but on a positive note for sellers, the average price showed a healthy increase of 19 per cent – $616,907 compared with $516,681 in 2009. And the luxury market continued to heat up recording 28 sales over $1 million, with six of those sales surpassing $2 million in June.

The Burlington area resale market reported a decrease of 15 percent from the same month last year, and a decrease of 6 percent from May of this year. The total unit sales for the first six months of 2010 are being reported at 18.7 percent higher than the same period last year, while new units listed are 20.7 percent higher than last year at this time, according to the Realtors Association of Hamilton-Burlington. A slower market brings increased inventory levels and fewer bidding wars, which creates opportunities for buyers who may not have been able to find what they wanted in the spring.

The key, especially during a slow market, is to deal with a broker who has a proven track record and is a consistent top performer – someone who you are confident will be able to sell your home quickly and for top dollar. Innovative marketing initiatives and investment, knowledge about the marketplace, commitment and exemplary service differentiate the Dan Cooper Real Estate Team. The result is that we are achieving accomplishments that illustrate the Dan Cooper difference. We are the Number 1 team in Canada for Royal LePage, which is a testament to our ability to sell homes fast in the Oakville and Burlington areas. In fact, we have been the Number 1 team for seven of the past 10 years. This is an accomplishment that does not happen by accident, but rather by design. Our dedication and commitment to selling your home, along with superior marketing strategies, have time and time again helped our clients sell their homes quickly and for top dollar.

We were also named Best Real Estate Agent and Best Real Estate Team in North Oakville Today’s annual Readers’ Choice Awards. The Readers’ Choice Awards are as grassroots as you can get, and being named Number 1 for both agent and team are proof that we are having a significant impact right here in our own community.

Dan Cooper is an award winning Broker with Royal LePage Real Estate Services Ltd., Brokerage – the Number 1 Royal LePage Team for Canada in 2009. He can be reached at 905.338.3737, direct line at 905.849.3303 or through his innovative and interactive website at DanCooper.com. Be sure to catch the Dan Cooper Real Estate Series on DailyWebTV.com. For his free booklet How To Sell Your House For Top Dollar – Fast! or his Guide to Oakville Real Estate, please call the Dan Cooper Team.

Posted in Best Real Estate Agent in North Oakville, Best Real Estate Team in North Oakville, Burlington, Burlington Real Estate, Finances, Oakville, Oakville Real Estate, Reader's Choice Awards, Real Estate, Real Estate Market, Statistics, Taxes | No Comments »

What the future holds according to Canada Mortgage and Housing

Friday, May 21st, 2010 by Dan Cooper

Bank economists have been releasing their latest predictions about the economy, but it is perhaps the Canada Mortgage and Housing Corporation’s recent release that is most pertinent to anyone selling, buying or building a home. While a home influences our emotional senses, we still want to know we made a wise investment. And it is in times of economic uncertainty that our financial know-how is tested.

So, what does the future hold according to CMHC? The experts there say a gradually improving Ontario economy, increasing household formation, improved financial market conditions and declining new home inventories will support housing activity. They also predict that we will see stronger economic growth in 2011, although the impending harmonized sales tax and higher interest rates will temper housing activity as strength trickles into other sectors of the provincial economy.

Ontario will be among the leading provinces fuelling the economic recovery across Canada in the next few years, according to CMHC. Strong provincial and federal government spending will support the provincial economy. Consumer spending is also on the rise and bankruptcies have dipped in recent months, further pointing to a recovery. Similarly, recent business outlook surveys indicate firms are optimistic about their business prospects in the next 12 months and will soon boost inventories to satisfy growing demand. This growth will mean more jobs. CMHC, however, cautions that a high Canadian dollar, productivity enhancing business investments and cautious U.S. consumer spending will temper employment growth in goods producing sectors of the economy.

The corporation sees new home starts continuing to lead the recovery and expects single detached homes starts will increase by more than 37 per cent this year and multi-family home construction will grow by more than 15 per cent. “Ontario existing home sales have remained remarkably resilient and will reach new highs this year… The strong pace in sales seen in recent quarters reflects households taking advantage of low mortgage carrying costs,” the CMHC report says.

While CMHC claims home sales are likely to cool during the second half of 2010 and into 2011 as rising mortgage carrying costs dampen demand among first-time buyers, Oakville and Burlington have always bucked the provincial and national trends. Our pocket of affluence has sheltered us from the wild price swings we have witnessed elsewhere in the country and our homes, while seeing some cooling in price during the recession, have always maintained their value and continued to support a wise investment. This is borne out by the latest local real estate board releases. Residential resales were up by 20 per cent in Oakville and 38 per cent in Burlington in April compared to April 2009 and prices were 11 per cent higher in both communities this year compared to the same month last year. The luxury market continues to heat up in Oakville, recording 22 sales over a $1 million last month compared to 10 in April 2009. Whether you are ready to sell, buy or build, Oakville and Burlington have proven time and time again to be among the best communities to invest in – both financially and for quality of life.

Dan Cooper is an award winning Broker with Royal LePage Real Estate Services Ltd., Brokerage – the Number 1 Royal LePage Team for Canada in 2009. He can be reached at 905.338.3737, direct line at 905.849.3303 or through his innovative and interactive website at DanCooper.com. Be sure to catch the Dan Cooper Real Estate Series on DailyWebTV.com. For his free booklet How To Sell Your House For Top Dollar – Fast! or his Guide to Oakville Real Estate, please call the Dan Cooper Team.

Posted in Finances, Real Estate, Real Estate Market, Statistics, Taxes | No Comments »

Is there still time to voice your opposition to the HST?

Monday, May 17th, 2010 by Dan Cooper

While it might appear to be too late to bring about change, there continues to be a growing protest against Ontario’s Harmonized Sales Tax which comes into effect July 1. In fact, businesses have already started charging the HST for goods, services and large ticket items like new homes that are scheduled to be delivered after July 1.

Why should you care? Because things that were not subject to the 8 per cent Provincial Sales Tax will now be taxed at 13 per cent under the HST. Essentially, the province is marrying the existing PST of 8 per cent and the Goods and Services Tax (GST) of 5 per cent to create one tax of 13 per cent known as the HST.

Under the HST, home buyers and sellers will have to pay extra tax on a range of services associated with real estate transactions such as mortgage insurance premiums, title insurance, legal fees, moving costs, real estate commissions and home inspection fees. Currently, consumers only pay the 5 per cent GST on these services. But it doesn’t stop there. We are talking about everything you purchase – electric bill, gas bill, water bill, condominium fees, insurance premiums and every other product and service you purchase. There are almost no exemptions.

The current PST does not apply to services, nor does it apply to the purchase of certain goods. The new 13 per cent tax will therefore extend the old 8 per cent PST tax rate to the purchase of all goods and services. The HST will apply to the purchase of new homes. If a person were to purchase a new $1 million home in Toronto, they would pay roughly $200,000 in taxes as a result of the Ontario land transfer tax, the new city of Toronto land transfer tax and the new HST. A tax like that could cause property values to fall and put the new home industry into a downward spiral, taking thousands of construction jobs with it. The fear among some is that in time, politicians will start looking at extending the HST to existing homes to mitigate the damage to the new home industry.

Canadians have two things they have been able to count on as being tax free – things that they can use to save money and accumulate wealth. Those are your primary home and RRSPs. That’s it. The extension of the HST to homes is simply a tax assault by the government. On top of that there are a myriad of fees and taxes that will now carry the HST – city property taxes, garbage fees, water fees, parking permit fees, vehicle licence plate fees, gasoline taxes, liquor taxes, entertainment taxes and the list goes on and on.

There is a group that still wants to fight back, even though this may seem to be a hopeless 11th hour pitch. If you take this issue seriously and still want your voice to count, you can sign a province-wide petition at www.unfairtaxgrab.com. If you don’t speak out … you won’t be heard.

Dan Cooper is an award winning Broker with Royal LePage Real Estate Services Ltd., Brokerage – the Number 1 Royal LePage Team for Canada in 2009. He can be reached at 905.338.3737, direct line at 905.849.3303 or through his innovative and interactive website at DanCooper.com. Be sure to catch the Dan Cooper Real Estate Series on DailyWebTV.com. For his free booklet How To Sell Your House For Top Dollar – Fast! or his Guide to Oakville Real Estate, please call the Dan Cooper Team.

Posted in Finances, Real Estate, Taxes | No Comments »