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Vancouver Off-Topic / Current EventsThe off-topic forum for Vancouver, funnies, non-auto centered discussions, WORK SAFE. While the rules are more relaxed here, there are still rules. Please refer to sticky thread in this forum.
Why would u set up as a corp, or do u mean an LLC (as a cdn, llc's aren't a good idea - a better idea is an LP with a 1% LLC blocker)
Tax and withholding burden is that, a burden.
Easy money is gone, 70% appreciation in 2.5 yrs has been nice, but now prices are relatively flat in real terms, and rents are ok, but too risky with a high mortgage from the US.
The risk/reward isn't there as an absentee owner anymore
But LP limits the involvement of the limited partner (assuming you, the owner)in the management in many states. Unless one is planning to have a full management company to do everything for them.
Problem with LLC is that CRA doesn't recognize its status and see it as a foreign corporation entity and it's taxed as such; making its benefits null for Canadian who still has a status in Canada (if you live abroad and claim non-resident status, that's another topic)
For CDN without a green card or US passport, if the state your property is located allows painless LLP setup, that's the way to go. You get similar benefits of a LLC and CRA has no problem with it as long as you file your own taxes accordingly.
But LP limits the involvement of the limited partner (assuming you, the owner)in the management in many states. Unless one is planning to have a full management company to do everything for them.
Problem with LLC is that CRA doesn't recognize its status and see it as a foreign corporation entity and it's taxed as such; making its benefits null for Canadian who still has a status in Canada (if you live abroad and claim non-resident status, that's another topic)
For CDN without a green card or US passport, if the state your property is located allows painless LLP setup, that's the way to go. You get similar benefits of a LLC and CRA has no problem with it as long as you file your own taxes accordingly.
LP with an LLC blocker - LLC is the GP, GP manages the LP. a limited partner can own an LLC too... you're just managing it with your LLC hat on rather than your limited partner hat on
LLC's become inefficient at 15% tax rate, i believe it is, below that you're fine - been a while since i set up my structures
I don't like LLPs as they're relatively new structures and technically could be broken, unlike an LP which is fucking bullet proof! do i think an LLP will be broken? not really, am i willing to take that risk? no - i don't risk my capital at all, especially if the difference is 1 extra tax return a year (my blocker LLC).
LP with an LLC blocker - LLC is the GP, GP manages the LP. a limited partner can own an LLC too... you're just managing it with your LLC hat on rather than your limited partner hat on
LLC's become inefficient at 15% tax rate, i believe it is, below that you're fine - been a while since i set up my structures
I don't like LLPs as they're relatively new structures and technically could be broken, unlike an LP which is fucking bullet proof! do i think an LLP will be broken? not really, am i willing to take that risk? no - i don't risk my capital at all, especially if the difference is 1 extra tax return a year (my blocker LLC).
The thing is, according to my lawyer, that if you use a LLC as the GP (general partner I assume, right?) in a LP, you, the limited partner cannot involve in the day2day operation of the property if you want to keep the protection.
Sure that from a tax perspective, it's ok. But if someone were to sue you or more precisely, your property holding entity, an experience lawyer will list everyone in the lawsuit. And, if they find that the LLC is operated by you (either in its entirety or partial), they can claim to nullify your limited partnership protection as you are ACTUALLY involved in the operation and the decisions that the property management makes.
The whole idea of LP's limited partner protection is based on the fairness to the limited partner who does not involve in making any decision for the LP. Hence its assets in the LP should be fully protected. Once the limited partner is involved in the decision making, the whole point is lost.
In a LLP, all partners share their respective amount of liability UP TO their ownership to the LLP. But it is structured as a partnership and hence offering the pass-through ability in the eye of IRS and CRA. So, while the asset itself is at risk... the most you can lose is the asset itself. And with a proper insurance policy in place (i.e: my property has an 2M insurance coverage against liability, while the value is roughly 1M), you can basically protect yourself and/or partners assets.
The thing is, according to my lawyer, that if you use a LLC as the GP (general partner I assume, right?) in a LP, you, the limited partner cannot involve in the day2day operation of the property if you want to keep the protection.
Sure that from a tax perspective, it's ok. But if someone were to sue you or more precisely, your property holding entity, an experience lawyer will list everyone in the lawsuit. And, if they find that the LLC is operated by you (either in its entirety or partial), they can claim to nullify your limited partnership protection as you are ACTUALLY involved in the operation and the decisions that the property management makes.
The whole idea of LP's limited partner protection is based on the fairness to the limited partner who does not involve in making any decision for the LP. Hence its assets in the LP should be fully protected. Once the limited partner is involved in the decision making, the whole point is lost.
In a LLP, all partners share their respective amount of liability UP TO their ownership to the LLP. But it is structured as a partnership and hence offering the pass-through ability in the eye of IRS and CRA. So, while the asset itself is at risk... the most you can lose is the asset itself. And with a proper insurance policy in place (i.e: my property has an 2M insurance coverage against liability, while the value is roughly 1M), you can basically protect yourself and/or partners assets.
i appreciate what you're saying, but this stuff is my bread and butter.
A limited partner that is also a partner in the LLC is fine, as LONG as he's signing as a member of the LLC is COMPLETELY protected. you aren't acting as an LP. Technically, they can't look through an LLC, so it's a non-issue.
The LLP issue isn't that you're not meant to get past the 'corporate veil' or LLP veil as it is - it's that the LLC and LP have 100's of years of court precedence supporting it, the LLP doesn't, and the LLP isn't in every state, which raises questions.
i'm not interested in debating the merits of my or other ppls' structures, i'm very experienced in this field (structuring corporate and other investments into the US from Canada) - the LLP is fine - but i prefer my structure for my own reasons
All that money is based on the price of the rezoning permit though, which is obvious. Part of me wants to buy one and be the asshole that refuses to sell right in the middle of the block, but we all know I don't have enough money to buy a home even to live in, never mind just out of spite.
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Originally Posted by boostfever
Westopher is correct.
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Originally Posted by fsy82
seems like you got a dick up your ass well..get that checked
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Originally Posted by punkwax
Well.. I’d hate to be the first to say it, but Westopher is correct.
All that money is based on the price of the rezoning permit though, which is obvious. Part of me wants to buy one and be the asshole that refuses to sell right in the middle of the block, but we all know I don't have enough money to buy a home even to live in, never mind just out of spite.
this is my problem, they've priced in the rezoning value, but haven't done the rezoning... but becuase we know local politicians are on the lamb, that when one of the local builders buys up, then it's as good as done and rezoned.
i hate people! especially politicians / bureaucrats!
I live in rezoned area and I am happy as heck! a couple of neighbors have sold their properties to developers for approx. 20%+ higher than if they were to sell their houses as a stand alone property. Developers needs land to develop and will make money regardless when they convert 1 single family home to 3 townhouses.
As absurd as it sounds, it makes buying in Vancouver West more affordable! townhouse price pt Vs single family home.
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I live in rezoned area and I am happy as heck! a couple of neighbors have sold their properties to developers for approx. 20%+ higher than if they were to sell their houses as a stand alone property. Developers needs land to develop and will make money regardless when they convert 1 single family home to 3 townhouses.
As absurd as it sounds, it makes buying in Vancouver West more affordable! townhouse price pt Vs single family home.
sure, if you want to live with shared wood walls, without owning a defined plot of land, with an inability to rebuild or make changes - then it's awesome!
making an area 'more affordable' by making them live in worse conditions isn't the kind of answers I'd be looking for!
sure, if you want to live with shared wood walls, without owning a defined plot of land, with an inability to rebuild or make changes - then it's awesome!
making an area 'more affordable' by making them live in worse conditions isn't the kind of answers I'd be looking for!
it's called sell house to developer for a good profit and buy in a different neighborhood that has not been rezoned....does that make sense to you?
for a guy that hates vancouver and vancouverites you sure spend allot of time bashing our city. haha!
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only looked at 3, but they're ALL currently for sale, and all in the same street?! >$2M for those pieces of crap? god i hate vancouverites!
Priced for perfection. It's like buying Facebook at 100+ P/E. There might still be another idiot out there that would pay 120 P/E for it. However, if FB's quarterly results come out even at 5% below consensus estimate, watch out, stock might fall 10 or 20%. The deverlopes might still be able to make money out of this counting on the greater fool theory. But it's like picking up pennies before a steamroller when you are acquiring the land at such a high price.
The notion people who rent are bums and have nothing to show for is completely nonsense. If you rent and spend all your money on unnecessary consumptions with no regards for your futures, then I say yes you'll have nothing to show for. But the people who rent and save their money and invest wisely can outperform the Canadian real estate over the long run. The long term return for stocks over the last 65 years since the end of WWII is about 10%, where real estate over the long haul is pretty much just the rate of inflation.
This whole Rent vs Buy question comes down to self-control. I hear all the time people tell me that by buying it forces you to save. Don't people have any discipline and control over their actions? Why do I have to get a mortgage from the banks to force myself to save? News flash, I can rent and save my money at the same time. Holy crap what a concept. The guy in the video only give you one side of the story. His side. Yes there is an alternative to buying and it is renting. It makes perfect sense in this overheated Vancouver market so you don't get locked down in big mortgage for the next 25 years.
The guy who've rented and failed in life is the one who don't have self-restraint and did not save & invest. The whole buy a house to built up equity is built on a false premise because it assumed people have little ability to control themselves otherwise. If you are sensible and rational, renting and investing can outperform real estate. And by investing in stocks wisely I don't feel like I'm missing any upside in canadian housing, in fact, I sleep pretty sound at night knowing I have no exposure to this city's real estate market.
Last edited by Carl Johnson; 04-08-2014 at 06:16 PM.
I really want to know what's supporting vancouver's economy? We really have nothing except for some mining, some resources, real estate, some tourism, some film, and foreign money (from people with rich families in asia). But these are not really huge industries except for Real estate.
But we don't have any well paying jobs. Even the low paying jobs are being taken by the Temp workers programs. A lot of my younger friends, along with friends of my younger brother and sister are moving to Alberta or Sask. Even highschool kids have a tough time finding retail or fast food jobs. I see a lot of people in their mid 20's working in retail than back when I was growing up.
This is an honest question here, I really don't see our economy sustainable in the long run. Maybe I'm underestimating some of our industries or underestimating how much foreign money impacts Vancouver.
i have to say, affordable housing is much better for an economy than high housing prices.
Look at Germany, and for that, most of mainland europe - ownership of what, approx. 50%, maybe less. Most rent, it's the social norm. Rents are very affordable. It means people have more to invest, and more to enjoy life with, to consume (read: stimulate the economy), they're not spending all their take home pay on their over sized mortgage.
I'm glad I don't give two shits what people think of me - I'll happily be a renting bum for a long time... people may 'see' that i rent, but they won't see me retiring at 50 or so, because they'll still be in debt with a shite retirement fund, whilst I'll be on a beach somewhere, or exploring a city i haven't fully experienced yet, etc.
it's all attitude, which is scary, b/c attitudes change REAL fucking quick!
I'd say the local high tech industry is doing ok. Not particularly well as the provincial government would like you to believe, but it is looking after itself.
Prior to the port strike, the cargo / import / export industry is probably doing ok as well. But now a lot of containers are not coming through the port because businesses are pissed off by the strike. In this case, I certainly sympathize with truckers. At the same time, I recognize how the strike has negatively impacted our economy as well.
I'd also say the healthcare industry is more or less managing, but it is only managing because it is getting stretched every possible direction, and sooner or later, something is gonna give.
Do these industries contribute a lot to the local economy? The high tech sector used to be quite big, but I don't really know anymore. And I can't tell what the other industries are like either.
I really want to know what's supporting vancouver's economy? We really have nothing except for some mining, some resources, real estate, some tourism, some film, and foreign money (from people with rich families in asia). But these are not really huge industries except for Real estate.
But we don't have any well paying jobs. Even the low paying jobs are being taken by the Temp workers programs. A lot of my younger friends, along with friends of my younger brother and sister are moving to Alberta or Sask. Even highschool kids have a tough time finding retail or fast food jobs. I see a lot of people in their mid 20's working in retail than back when I was growing up.
This is an honest question here, I really don't see our economy sustainable in the long run. Maybe I'm underestimating some of our industries or underestimating how much foreign money impacts Vancouver.
I was just thinking the same question recently too. Did Vancouver's underlying fundamentals have improved so dramatically the past decade to justify the price increases? Or what we are seeing is simply a short term phenomenon. A temporary boost in home prices because people's psychology have changed. Higher prices attract more people to participate. We all know how many people love Vancouver this beautiful city. Well the more you love something the more you are willing to pay for it and many times that decision can be irrational and emtional.
But we don't have any well paying jobs. Even the low paying jobs are being taken by the Temp workers programs. A lot of my younger friends, along with friends of my younger brother and sister are moving to Alberta or Sask. Even highschool kids have a tough time finding retail or fast food jobs. I see a lot of people in their mid 20's working in retail than back when I was growing up.
This is an honest question here, I really don't see our economy sustainable in the long run. Maybe I'm underestimating some of our industries or underestimating how much foreign money impacts Vancouver.
I'm in my 30s. Most of my friends who were brought up in East Van in typical Asian immigrant families have become modestly successful. Some have gone on to big things abroad, while others have settled for comfortable lives in various professions such as engineering, finance, health care, and the like. I look at the rest of my cohort and they've also settled into similar lives with children and homes (whether they be condos in the city, or detached homes in the burbs). I'm still a Gen-Y person, but an old one at that. I feel for the people in their 20s because they have a long and tough road ahead (unless of course, they're engineers or doctors). Posted via RS Mobile
you can be unemployed even if you are a doctor or engineer. be the top 5% in any field and you'll have no problem landing jobs and getting promotion. diligence and persistence matters. the fails in life talk a lot but do very little.
I'm still a Gen-Y person, but an old one at that. I feel for the people in their 20s because they have a long and tough road ahead (unless of course, they're engineers or doctors). Posted via RS Mobile
remove engineers from that list. it's not easy to be an engineer in this city.
and expect to make less here than in canadian cities east of here, unless you're top in your field like carl said.
you can be unemployed even if you are a doctor or engineer. be the top 5% in any field and you'll have no problem landing jobs and getting promotion. diligence and persistence matters. the fails in life talk a lot but do very little.
Just because you are not the top 5 does not mean you are a failure. What about the other 95%? Not all of us can be superstars, the majority of people will be average, thats why its called average. With economics not improving, along with globalization, i think the average person will continue to get worst or poorer. Lack of jobs will mean more labour competition, thus reducing wages. Most of the money is spent paying mortgages or sending their money back to Philippines, mexico, or any other country so there is no demand for goods and services, no demand for goods means less manufacturing and services. Even non mortgage debt is at an all time high.
Like i said, we may be in for a tough fall if something acts as a catalyst to start it all. Posted via RS Mobile
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