Residency Rules Snowbirds Need to Know Avoiding Canadian winters by heading to the warmer climate of the southern United States has long been a common goal for Canadian retirees. These snowbirds look to enjoy the warm weather while maintaining their Canadian ties. For many it’s a great way to spend a part of their retirement, as long as they are aware of the potential tax consequences. Many of them are just like the parents of my friends, a healthy sun-seeking couple named Mary and James. They’re well-to-do and readily able to afford a few months in Florida’s warmth, and they think they have all the knowledge they need to avoid any tax or financial pitfalls that may be caused by their extended time in the U.S. At a gathering recently, James confidently

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Sales remain slow with only 284 total sales on MLS this January, 27% fewer sold compared to 372 sales January of 2012 while inventory of homes for sale is up marginally to 3,870 compared to 3,715 this time last year. That translates to more than a 13 month supply = Buyer’s Market. In 2012 only about 1 in 3 who listed their homes for sale succeeded in selling. From my viewpoint prices have declined substantially in some cases, more dramatically with high end, rural and properties with significant negative influences. Furthermore, in my personal crystal ball I think the market is beginning to stabilize, many who would like to sell are now frozen with high mortgage balances relative to their property values preventing a flood of new listings at adjusted…

U.S. housing starts moderate in January after the previous month’s surge; producer prices inched higher in January

• Housing starts declined by 8.5% to an annualized pace of 890,000 units in January 2013 and missed market expectations for a modest drop to 920,000 units.
• Building permits increased by 1.8% in January to an annualized 925,000, slightly stronger than market expectations for a reading of 920,000, and represented the highest level since June 2008.
• Some moderation in homebuilding was expected to kickoff 2013 after the sharp acceleration at the end of 2012, with the upward revisions to the previous month bringing the quarterly increase in starts to an annualized 84% in the fourth quarter of 2012. We anticipate that the pullback in

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The Canadian penny isn’t going to disappear quietly when the Royal Canadian Mint officially begins phasing them out on February 4th. Thanks to Free The Children and RBC, the penny is being given a week long send-off. From Monday February 4 through Friday February 9, Canadians are being invited to bring in any amount of pennies in any container to any RBC branch in Canada in support of clean water projects around the world.  Make it easy for clients to drop off pennies – have a We Create Change penny bag at the CAO desk or in a central location. As the bag reaches the $25 fill line, simply remove the bag and replace it with a new one. Before sealing the bag, ensure there are no other coins (quarters, dimes etc) mixed in with the pennies.

Stance: Slowdown, not slump Every time there’s news about a dip in Canadian housing activity it fuels frenzied speculation about an impending U.S.-style crash. While home prices in Canada are headed for a correction in the coming year or two, it would be an overstatement to liken it to the U.S. market of 2006. Canada today is very different from a pre-recession America, especially as far as borrower profiles go. Cautious optimism The extremely low mortgage delinquency rate in Canada can be considered a measure of our stability. But our southern neighbour has taught us that this sea of tranquility can turn cataclysmic overnight. In just a short 18-month period in 2007-08, the mortgage arrears rate in the U.S. surged by more than 300%. The same holds true…

The B.C. First-Time New Home Buyers’ Bonus is a one-time payment worth up to $10,000. B.C. residents who are first-time home buyers and who purchase an eligible new home on or after February 21, 2012 and before April 1, 2013 may be eligible for this bonus. A first-time home buyer is an individual who has never previously owned a primary residence anywhere in the world. A primary residence is generally a house that you own, jointly or otherwise, and that you intend to live in on a permanent basis. You may have more than one place of residence, but you are considered to have only one primary residence.

Qualifications

You may qualify for the bonus if you meet all of the following criteria:

• You purchase or build an eligible new

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U.S. existing home sales unexpectedly slip lower in December

• Existing home sales in the US unexpectedly slipped by 1.0% to 4.94 million annualized units in December 2012 from a revised 4.99 million (previously reported as 5.04 million) in November. Market expectations had been for sales to rise to 5.10 million in December.
• The drop in sales was outpaced by an 8.5% decline in the number of homes available for sale in December. With inventories falling faster than sales, the months’ supply of unsold homes declined to 4.4 from 4.8 in November. This marked the lowest months’ supply since May 2005.
• Consistent with tightening inventories as well as a declining share of distressed property sales, the median price of existing homes jumped by 11.5% on a

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A few things you need to know when Buying or Selling US Real Estate

FIRPTA FOR SELLERS: As a Canadian selling your home, the US Government takes 10% withholding tax on any home/condo that a foreigner sells... How do I prevent 10% withholding tax?

• File a 8288 form found at irs.gov
• Ask yourself these 3 questions: If yes to all 3 questions -- the Canadian seller MAY be exempt from paying the US Government 10% withholding tax
  • Is the condo/home I am selling under $300,000 US?
  • Is my condo/home a residential property?
  • Is the buyer of my condo/home going to occupy as a primary/secondary owner? (so, if the buyer is going to turn the home/condo into a rental -- you now just lost your exemption)

FIRPTA AS A BUYER: If you are a

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Home-price forecasts for 2013 are on the rise. J.P. Morgan Chase & Co. expects U.S. home prices to rise 3.4% in its base-case estimate and up to 9.7% in its most bullish scenario of economic growth. Standard & Poor’s, which rates private-issue mortgage bonds, on Friday said it expects a 5% rise in 2013. The J.P. Morgan analysts boosted their base-case estimate from 1.5% after a convincing rise in the “net demand” for housing this year has surpassed 2 million homes for the first time since 2006, said John Sim, a strategist at the investment bank. Net demand is the pace of existing home sales minus the inventory of homes available for sale. “Net demand has picked up a lot in 2012,” said Mr. Sim. “Once you get north of the 2 million territory, you are in…

Ron's candid thoughts:

While statistics indicate relative price stability, our experience continues to confirm that sellers in distress are competing for the relatively scarce ready, willing and able buyers. Increasingly while the average sale price shows only a few percentage points decline, what Buyers are actually getting for their money has changed significantly, particularly over the last six months since the mortgage rule changes. Having said that, I’m seeing an increasing sentiment of it being a good time to buy and on our team we experienced a flurry of activity finishing the year with a busy December even getting an offer together on Christmas Eve. Nationwide consumer sentiment seems to be generally optimistic according to reports from

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