The other day, I heard a report on CBC that housing sales are down an overall 3%, primarily due to the B.C. housing market. Although this is a very busy time for real estate deals, the number of deals our office is handling is leveling off compared to same time last year.
In my unqualified opinion, housing prices are not declining. Instead, they are stabilizing which means that the gross competition and bidding wars experienced in recent past is now tailing off. As an aside, two months ago, I was successful in having CMHC reverse a refusal to extend coverage by presenting them with a 3rd party valuation substantiating the fair market value at $80,000 over list. This saved the deal and ensured that the client did not lose their $10,000 deposit.
The new reality is that the recent boom and fierce competition has helped many, who held onto their home, to increase their equity intended for retirement. Good for you and good for the many that got into the housing market before the boom.
Interest rates? Again, in my unqualified opinion, I don’t see a large shift over the next 24 months. Interest rates are tied to multiple economic factors but the simplest I see is that our economy is still transitioning to the new reality of high tech – we are not entirely there yet. In fact, I have a lot to say about this growth area but that is for politicians and economists to solve. I enjoy leaving this for “nice” dinner conversation.
If you have had a car accident, even if you don’t think you have been injured, there are certain things you need to do to protect your own rights and to protect yourself from claims from other people involved in the accident.
Always call the police even if it is just a “fender bender”. A police report is essential to making any sort of insurance claim yourself for damage to your vehicle or for accident benefits which are available regardless of fault to all insured motorists. A police report is also essential if you want your insurance company to defend you against a claim from another person involved in the accident.
Your next call, after the police investigation is completed, should be to your insurance agent if you have one or to your insurance company directly.
Late reporting of an accident may allow your insurance company to deny you coverage if you are sue d as a result of a car accident or create scepticism if you are making an accident benefits claim.
If there is even a hint of you being injured and you haven’t gone to the hospital from the scene, go and see your family doctor for assessment and appropriate treatment as soon as you can. If you can’t get an appointment right away, go to a walk-in clinic for initial treatment. Car accident injuries, such as whiplash injuries, can take days or weeks to develop and documenting the initial complaint as soon as possible after the accident creates a good foundation for a damages claim.
Then, feel free to call Earl Taylor at Green Germann Sakran at 905-639-1222 x245 for a free consultation about your rights after an accident. There are no upfront legal fees and no legal fees at all unless you recover a settlement or judgment.
Why Incorporate – a lawyer can discuss the benefits with you
My father was a grocer and he was always a sole proprietor. He did very well and it worked for him. He never bothered to consider the benefits of incorporating. Even when he bought a grocery store for my brother and revenues doubled, there was never any discussion around our home on whether we should incorporate.
Times have changed and I now believe that my father should have considered incorporating for a variety of reasons, like:
The lifetime capital gains exemption on sale of an active business (up to $800,000 per individual shareholder);
Protecting personal assets from creditors and personal injury claims;
Getting the benefit of lower corporate tax rate, income splitting, dividends and retained earnings;
Estate & Succession planning – ie. a trust to own holdco – holdco to own the realty and opco.
Easy to say, however there are many things to consider on whether or not to incorporate. For example, if you own a rental property that is considered “passive income” and therefore incorporating does not entitle you to a lifetime capital gains exemption. Only “ongoing concerns” are entitled, like retail or sales business, manufacturing – something that involves doing something to earn money rather than sitting back and waiting for it to collect in your bank. Of course, I am using a simplistic analogy. However, if you had at least 5 employees in a rental property business, then all of a sudden, it is no longer considered “passive income” and you would be qualified for a lifetime capital gains exemption in the event of sale of shares of the corporation.