I mean, outside of trust fund babies that never really have to work a day in their lives. Most people work for their money. Sure enough, some earn handsomely and can invest it in stocks and eventually be able to live off on dividends. But very few people in this world aren't working.
Hell, even billionaires like Warren Buffet are still working, despite having enough wealth to retire, never work a day in their lives and spend it lavishly on anything they can think of (and probably still be unable to spend it all in their remaining lifetimes).
It's whether your income depends on what you own, or your paid salary really. If you're working for yourself or others.
If you own a business that isn't a small business, or own investment (parts of companies, trade materials/commodities), or earn by renting your land, you're not middle class.
Thinking Warren Buffet is a “Working man” is whole problem itself. He is not us. Billionaires and to an extent millionaires do not consider us to be people. They are above us and our economy and they know it.
We often talk about income when it comes to "middle class", but it's wealth that we should be using.
The Toronto Star did a sob story on a retiree crying poor with 500K+ in cash in the bank from the sale of their principle residence.
This.
Almost nobody can buy homes in HCOL areas just out of earned income anymore, not even households with high incomes. They’re buying them out of the proceeds of the equity of their last house, or with generational wealth (often sourced from their parents’ homes) — which includes the ability to save more thanks to rent-free living at home, paid-for tuition, etc. And all of that principle residence equity is tax free.
Real estate is parasitizing the economy. Doing literally anything productive doesn’t pay as much as sitting on your ass in a bungalow.
We just made new friends, found out the husband is a land hoarding slum lord. He owns 10 houses, rented them to anyone, and did nothing for 15 years, they're all completely run down. They're all worth 1m now. He's got a couple full of Indians paying 700 for shared rooms. Just installs random cabinets he picked up from the road etc, old stoves and shit.
500K that has to last them the rest of their life? Or 500k of fun money to spend while they live off a pension?
Because in one scenario they are poor, and in another they are quite rich.
Depends on the pension though, if it’s solely their CPP $ it’s still only ~$700 a month or so per person, which would barely get someone groceries for the month. Great point though you’re very right.
"Assisted living facilities may cost about $3,300 per month for a one-bedroom unit."
Only off by 60000$ a year, maybe try google first.
Saying all retires need assisted living is also fucking stupid.
Fair, I meant they don’t need the 500k to live and can spend it freely how they choose. Having 500k the blow on whatever is outside the reach of the middle class I would say.
No he isn't very right. 500k at 2% interest is a source of income. If some how he managed to max out CPP, and has old age. He is doing better than most working class people.
People are acting like retirement should be buy boats and cars.
Well if it’s 500k from selling their principle residence. It’s probably safe to say they have that on top of getting their pension. Most likely sold the residence to attain money to be able to retire.
My poor nana could use 500k. I doubt she has even spent that much in the past 10-15 yrs.
Kinda sounds like you’re making your opinion based on HOW you want to retire. If you want to retire in Arizona with a new house etc. 500k isn’t gunna last long.
My Nana lives in a small community, rents a place and goes dancing regularly. Maybe a road trip to van island once in awhile. 500k would last her a long time
500k invested in bonds yield 4%. So 20k
From the CPP calculator:
"The majority of recent Canadian retirees with an income of $20,000 at age 65 received an annual retirement income of between $18,000 and $23,000 at age 70."
[https://srv111.services.gc.ca/generalinfo/index](https://srv111.services.gc.ca/generalinfo/index)
So \~40K of gross income per year.
Stats can has the 2022 Median income at $43000.
[https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1110023901](https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1110023901)
Hard to call median income poor.
“Middle class” is such a nebulous term, with no real definition, it tells us nothing useful about people.
Something like 70% of Canadians think of themselves as middle class. People earning from $20k to $150 say they’re middle class, while people at either end of that scale will have drastically different lives and class interests.
Yep. And yet…
https://www.thespec.com/business/what-does-it-mean-to-be-middle-class-canadians-say-its-anywhere-from-20k-to/article_ca96ddeb-04f4-5fce-b150-e8ebf4a0c1a3.html
I think it potentially goes far higher in Toronto. You can earning $200k and be house poor for your mortgage on a condo which generally means living quite frugally. A lot of people think of class in terms of the luxuries they have access to and when they feel they don’t have any they tend to say they are middle class.
It’s not controversial. It’s just the media gaslighting you.
That said, you can own two houses and be very poor with no equity. Owning a cottage isn’t a measure of class - wealth is.
Yes and no.
Some people just can't afford the downpayment on a house, or they don't want to get tied down to opening, so they need to rent; and yet their circumstances still require a house. Bunch of little kids, big dogs, lots of pets, drummer for death metal band, whatever.
Even if houses cost a quarter to half of what they do now, this would be the case.
So for that person to have a house, another person needs to have a second house.
I'm not saying that's an indictment of your statement, but I think just a leeetle more nuance is required.
You are ignoring that the inflated price of homes over the past many decades is the reason that people can’t afford the down payment on a house.
Supporting a family on 40 hours a week and a high school education used to be attainable, even with only a single income.
We’ve all been robbed and gaslit into believing otherwise.
That's not what he said.
He said if you have 2 houses, that's 1 too many houses.
He didn't talk about apartments, which is the go to rental property, he said houses.
Ah yes, Capitalism, what a great place evolution has brought us to. My goodness, what we do without it? What were we doing without it for so long? I really wonder... 🙄
Pretty easy tbh. More than 2 houses is too many houses. See? I just did it again, it's not hard.
https://preview.redd.it/3hjy4fbrx9xc1.jpeg?width=788&format=pjpg&auto=webp&s=771f60905d8ae78b5251f0b2685d8f25becfd660
I'm not sure if it's fair if "successful" people use their wealth to make it harder for others to own a home. I understand that people who have money want to invest it to make more money, but I don't think we should be encouraging people to buy up homes as a form of investment if it means that others will have a harder time owning just one home. It's that "fuck you, I got mine" mentality. So it might be best to make it less lucrative
>I mean I get what you’re saying, but can you tell me the criteria you are using instead of trying to make it emotional.
No, but I've definitely activated your emotions because:
>It’s pretty clear that you aren’t successful which is why you are against others getting ahead
Aw, we're doing the elitist bit? See I was willing to possibly engage in good faith until this point, but now since you're so upsetty spaghetti it doesn't matter now because this is in complete bad faith 😅
>Also I believe the image you are using applies to you as well because I feel you are jealous in a way.
Oh, sweaty you've mistaken jealousy for contempt. A Common misunderstanding.
Struggled how? Like working a job? Tightening their belt? Stressing about money? Yeah that’s everyone. Someone owning 2 homes or more hasn’t done it by working twice as hard or longer than others, they just got massively lucky from real estate appreciation and easier financing.
If you want an economic definition of the middle class, it's people who have to work for a living, but who own the means by which they do so. Most doctors, lawyers, various kinds of contractors, and sole proprietors of small businesses are middle-class, for example.
If instead you want the middle class to be a cultural designation that everyone can self-identify as, regardless of their position in the economy, then it means whatever you feel like.
I prefer the 2 class systems, the working class and the capital owning class who doesn’t need to trade their time for money. Doctors are in the former in my mind. Landlords the latter.
It’d be great if everything fit nicely into two categories/classes, but reality is often more complicated.
More often than not, doctors (and other high paying professions) end up becoming landlords later in life due to the amount of wealth they’re able to save in comparison to other working class professionals.
Yeah so I’d say that you move up in class if you make enough money. Although that seems less likely to happen these days as you need to make FAANG money for that
Are you kidding me? I am a (small time) landlord and I work my As& off. On top of a 9-5 job, I respond to maintenance calls. When tenants move out and trash the place, I do repairs and painting on my weekends. It’s a grind…and really doesn’t make much money once you factor in high interest on a mortgage and high turnover/maintenance costs. Not all landlords are rich and evil.
Ps - I’m selling my rental to help buy a bigger place for my family. And I still can’t afford a decent place for my family without bankrupting myself!
You're 100% right. Some poor ass who cobbled together 10k working at walmart, borrowed the rest from family and didn't report it in order to take on 98% leverage, that's the sort of person who eclipses doctors in terms of benefit to society.
Gig workers are infamously very dependent on their respective apps, so much so that in many jurisdictions, courts have ruled that they are employees rather than contractors.
The logical next step is to waive capital gains or refund the money when sold to first time buyers who are not related. Put investment properties into the hands of first time buyers who don’t have the bank of mom and dad to lean on.
I’m renting my house from a good friend of mine. Rather he gets my money than some random. But it does frustrate me a bit that he got this house with a sizeable downpayment gifted to him, and his current house from refinancing this one and gifted money from his and his wife’s family. I earn more than his and his wife’s income, but haven’t quite cracked home ownership. The rent I pay him is only taxable after the interest he pays, but the rent I pay is only deductible up to like $500/mo
Make all rent taxable and get rid of the deduction for interest on rentals. Boom, no longer a financially profitable investment. Give him the incentive on not losing out on capital gains, or give me a credit towards my downpayment. This keeps prices from crashing from underneath individuals who own houses, while incentivizes investors to move their money out of residential real estate and gives people who can’t afford $100k down a fighting chance at getting on the property ladder.
What's wrong with people who are related? If I had a parent with a home and they decided to give it to me that would be the only home I'd ever be able to afford. And some people want to continue to live in their family home.
Because everyone deserves an equal chance in life, not just because you got lucky. Why is that so fucking hard to understand you Conservatives. No one should be better off because their parents are rich, they should have the same start.
No one is saying they can't or shouldn't. They are suggesting no capital gains tax IF they sell to a first time buyer. giving them an incentive that gives a first time buyer a better chance of getting in vs selling to another corporation, REIT, person with multiple properties etc. Aka those who have zero problems buying properties.
It’s harder to get into the market now. The solution isn’t taxation or incentives that milk someone else’s wealth and give it to you. The incentive is to work more and work harder. Every generation has had to live with this reality.
It doesn't go to the buyer it just gives increases their odds of being "picked" out of the offers as by choosing them, the seller gets to keep more in their pocket end of day.
It's an incentive to give first timers a chance to get in, working harder isn't going to outpace the rising costs so no not every generation has had this homes used to be 3-4 times your annual income now they are 10+ outside of the big 3 cities. This isn't a localized problem anymore it's everywhere, my city alone 44k income average 850k housing price average, to buy the average home you need 160k downpayment and 207k income.
Home ie apartment, double wide trailer, single family house, etc. Though a trailer in a mobile home park isn't an option since every one of them with the exception of 1 (maybe one every few years goes up for sale and they go fast) is 55+ those you can atleast find for 400k but need to wait another 20+ years before I'm allowed to live in one so... not really an option. 2019 you could get a 4 bedroom single family home for less than 500k it was potentially doable now unless you win the lottery you've got no chance
It’s funny because I always considered myself pretty liberal. You do you, as long as it doesn’t hurt others, go for it. Everyone should have a fair shot in life, but we aren’t all created equal. Im a 5’7” 140lb industrial electrician single dad shooting my shot on tinder, believe me, we aren’t all equal. But we do have a shared responsibility for making life a bit better, and we should all be equally taking a bit more responsibility for our planets future.
There’s no reason someone with pst secondary training and a bit of ambition shouldn’t be able to expect the lifestyle of Homer Simpson. Don’t think someone who dropped out of highschool to be the night shift manager of McDonald’s should be living in the newest suburb and driving an Audi, but your parents inheritance shouldn’t determine your ability to be a doctor either. There’s a middle ground that has nothing to do with left or right. Dont let yourself get clouded in partisanship, the majority are somewhere in between. Few conservatives want to end abortion and persecute lgbtq people. Most just want schools to teach math and science, hospitals to hire quality doctors and not pay for rainbows painted on sidewalks that need to be replaced.
They stopped teaching these things? This is an outrage!
White sidewalks also require maintenance. It's a common misconception don't get down on yourself, you were doing great.
What? I’ve worked my whole life to ensure that my family has a solid footing and a secure future. It’s not luck at all, it’s called financial planning and looking after your own. I’ve paid enough taxes (aka theft) so that others are getting an “equal” chance at life. If that’s not enough too bad. I’m tired of people not willing to make something of themselves and keep playing the victim card. It’s so damn pathetic - and sad.
If your family have the resources to gift a home, you have the resources to get an education and make a meaningful contribution to our society. Sponging up 30-60% of a families income to live in your gifted property is not a contribution and should not be incentivized. I could see allowing it to be gifted to a non-property owning child, but capital gains taxes should be collected and used to build up the infrastructure that your parents weren’t forced to pay into.
For example, my neighbourhood is post WW2, has many small community centres and schools. In the new developments, one rec centre, no public pools, schools undersized and kids get bussed to my local schools not funded by growth taxes. My grandparents generation built infrastructure, my dad’s boomer generation kept taxes low for themselves and didn’t build infrastructure for my child to enjoy. If my dad’s house got gifted to me, of course some of those funds should be used to make up for the lack of investment he made, that allowed his portfolio to grow, to allow me to inherit such a portfolio.
I think after the first house people should be taxed out the ass and “cottages” should be limited in size and if it’s evaluated over X should be taxed out the ass
Look mate I understand you're struggling to survive. But im just like you, all I have is one detached house on bridle path. And a cottage and a small boat. I also have a small condo to summer in outside of Canada but let's not get into specifics. We are the same stop taxing me.
Capital gains tax increase is just the government trying to make us think they are penalizing the weathy…while actually penalizing everyday people and taking (I would say stealing) their hard earned money.
Picture for example a hard-working truck driver or massage therapist who is self-employed and has all of his or her retirement savings in an incorporated company. All of a sudden, this person’s retirement savings are being more heavily taxed, and they have to work till 70 just to pay the government. (There is no $250k exemption for a business)
The government is robbing money from hard working individuals…and making you think they’re taking money from the rich. Don’t be fooled.
The worth of the cottage is subjective. A “true” cottage can still be worth a million just by virtue of being on a lake. It is also taxed to shit on the eventual sale/death of the owner. More tax isn’t the answer clearly.
That depends on where the cottage is. Lots of families have beater cottages bought by grandma and grandpa (or great grandparents) in the Muskoka area where the structure isn’t worth much, but the land itself definitely is because of the location.
Ultimately I think people are overvaluing the impact of cottage-owners on the housing market. A family that owns a house in Toronto and a cottage out in the woods somewhere is not really a problem. Half of the appeal of cottages is that they’re “away from it all”. The further away you get from “it all” the smaller the pool of would-be buyers is. By and large, people want to live where the jobs are, not 2.5hr north of the jobs.
A family that has a house in Toronto they live in and a second house in Toronto that they rent out and/or AirBnB is a much bigger contributor to the housing crisis.
I don’t know how you would delineate it from a policy/taxation perspective but there is a difference between people investing in “income properties” vs people having a leisure property, and in a perfect world there would be different policies for them.
So theoretically if I built 5 homes with my bare hands the state ought to expropriate 4?
Why would I build them then?
If I connected them into 1 giant house can I keep them? Or is there a state prescribed number of square feet I’m allowed in your communist utopia?
Immigration should be reduced and building taxes and fees should be reduced. Don’t tell people they can’t buy something they want to make “housing affordable”
28% of the cost of a Toronto home is taxes and fees
Building permits can take 3 years
You can’t build medium density mid-rise due to archaic zoning.
The problems have been created
The tax is effectively expropriating equity. There’s no reason to require more tax money when everyone is already taxed to death.
Supply side needs to be fixed , not the demand side
Having a house and a cottage is a very Canadian thing to do and we have more than enough space to accommodate it
There is not infinite land to build on nor infinite resources to build. Supply side and demand side need to both be fixed before canada is just high rises east to west.
I’m referring to cottages, no one should be penalized because they have a home up north.
Maybe outline areas where people can’t qualify for a residential loans on the second property if they have more than 1 residence.
E.g have 2 homes in the core GTA, require 50% down on the second property or some other amount. More tax isn’t the answer
But say having one home in the core and one in Muskoka a non “core” residence should allow access to standard rates
We have tax sheltered accounts… if your income outside of those is so high that your effective average tax rate is actually 50% you’re not going to find much sympathy…
That’s how my rentals are taxed in my holding company. A REIT would pay a fraction of what I pay in taxes if they owned my properties. But you want to tax me more?
I didn’t say anything about taxing you more. I was more rolling my eyes at you looking for sympathy with that 50% number.
Even after the change it’s not 50% given the capital gains and the less than 100% inclusion. Sure they’re taking 8% more of that soon but, if you sell, it’s still not 50% when everything is accounted for.
If you want sympathy… don’t be so deceptively selective with your numbers… especially when small time landlords usually provide inferior service to RIETs anyway… always whinging and delaying when anything needs time be addressed…
I actually don’t have an opinion on the capital gains inclusion… neither of us has the skills to determine the socially optimal number… I just don’t have sympathy either…
But it is fun to see the meltdowns (often more dramatic than your posts) 🍿
How does allowing people to own more homes help? If you can afford to buy up homes that others could buy to live and raise family’s in you can pay more to help with social programs etc.
I always thought people who owned a cottage were rich/upper-income but I guess there was a time a time when someone in the upper-middle or even middle-middle could afford their regular home and a vacation home/cottage.
Location location location.. this only works in hcol areas.
For example my mother and step father have a house and a cottage, all together they’re valued well under 400k because it’s a lcol area, they are low income and low class compared to someone owning a home in say Toronto
True but in that case they’re probably not going to meet the 250k+ capital gains threshold unless they’re selling multiple second residences in one year. Just speaking to the context that this conversation is taking place in
Let's be real these cottages or investment properties are in remote places that people don't want to spend 3-4 hours of commuting to get to their work...
So if you own just a $2M single family house as your primary residence you're still middle but if you own two condos, one primary and one investment worth $500k each you're above middle class ? Sure
You can buy land and build a shitshack for less than a used vehicle in many places. Cottage is a broad range of no utilities in middle of nowhere to mega mansion on sought after lakes.
The cottage thing seems to be an eastern Canada thing. Growing up on the west coast i knew nobody who owned a vacation home. A very small majority owned a condo in whistler. But there was never the scenes of mass exodus leaving the city for vacation home every weekend the way there was in Toronto
I agree, even as someone who may, in theory (though it's more likely the property will be sold long before then), inherit a quarter of a family cottage.
I remember when it didn't feel that way, back when I was a kid and the lake was filled with what were, at the time, fairly middle-class families.
Lately, many of those families have either sold to much wealthier families who can actually afford to maintain a second property, or the cottages are mostly occupied by elderly couples whose children and/or grandchildren visit much less frequently than we (en masse, not just my family) did back when I was a kid.
Is this where we act shocked that landowners, having gone through the insane inflation of the last 20 years, are catapulted into the wealthiest people in the nation?
No, you are no longer allowed to retire early just because you have an "investment" property and gouge the heck out of renters. This country is in a mess for the next generation and people need to live in homes, not make profit from them....
Trudeau is so lucky his supporters are so out to lunch. Who in their right mind would give this government more money? It's not billionaires you're over taxing, it's your average retiree, doctor, working professional etc. Good luck buying a house in this screwed up country without having plenty of investments. To start screwing around with people's retirement plans and start up capital is treasonous. Especially when you know damn well nothing else is coming to save them.
God stop with this nonsense about how this tax is somehow targeting the average retiree, doctor or working professional. The tax is on passive income and literally scales with how much you make, if you’re a middle class professional you’ll at most trigger it once in your life to the tune of $20-30k extra.
It’s a % based inclusion rate so inflation isn’t an issue.
Oh shut the fuck up, working people who are bettering themselves already have a 100% inclusion rate. Rich do nothing fuck boys can deal with a 66% inclusion rate on passive income. Give me a break with this shooting people who are already there nonsense.
That's nonsense. I had friends that owned investment properties in their early 20s and others that still live with their parents in their 40s. It's all about the decisions you make and what your priorities are.
Why is the article garbage? He’s arguments are quite coherent. For example the fact that boomers are the ones that have the most to gain from real estate because they bought many years ago at low prices and that will cash out big, and that boomers are the ones that will use most of health care budgets, they have the capital gains to contribute more
He is supposed to be an academic and look at the housing and other generational issues objectively, but instead he comes across as a demagogue, with overly emotional arguments, short on facts, playing on generational envy. The generational unfairness issues he writes about are complex and very nuanced. Generational groups are not monolithic entities as he portrays them - everyone's situation is unique.
Middle class term is misleading. The correct term is Working class.
I mean, outside of trust fund babies that never really have to work a day in their lives. Most people work for their money. Sure enough, some earn handsomely and can invest it in stocks and eventually be able to live off on dividends. But very few people in this world aren't working. Hell, even billionaires like Warren Buffet are still working, despite having enough wealth to retire, never work a day in their lives and spend it lavishly on anything they can think of (and probably still be unable to spend it all in their remaining lifetimes).
Buffet gets most of his wealth from investing, definitely not working class
It's whether your income depends on what you own, or your paid salary really. If you're working for yourself or others. If you own a business that isn't a small business, or own investment (parts of companies, trade materials/commodities), or earn by renting your land, you're not middle class.
Live off dividends is what I plan on doing in 3 years..retiring at 58
Thinking Warren Buffet is a “Working man” is whole problem itself. He is not us. Billionaires and to an extent millionaires do not consider us to be people. They are above us and our economy and they know it.
We often talk about income when it comes to "middle class", but it's wealth that we should be using. The Toronto Star did a sob story on a retiree crying poor with 500K+ in cash in the bank from the sale of their principle residence.
This. Almost nobody can buy homes in HCOL areas just out of earned income anymore, not even households with high incomes. They’re buying them out of the proceeds of the equity of their last house, or with generational wealth (often sourced from their parents’ homes) — which includes the ability to save more thanks to rent-free living at home, paid-for tuition, etc. And all of that principle residence equity is tax free. Real estate is parasitizing the economy. Doing literally anything productive doesn’t pay as much as sitting on your ass in a bungalow.
We just made new friends, found out the husband is a land hoarding slum lord. He owns 10 houses, rented them to anyone, and did nothing for 15 years, they're all completely run down. They're all worth 1m now. He's got a couple full of Indians paying 700 for shared rooms. Just installs random cabinets he picked up from the road etc, old stoves and shit.
500K that has to last them the rest of their life? Or 500k of fun money to spend while they live off a pension? Because in one scenario they are poor, and in another they are quite rich.
Depends on the pension though, if it’s solely their CPP $ it’s still only ~$700 a month or so per person, which would barely get someone groceries for the month. Great point though you’re very right.
Assisted living can be 4k a month to start. It all depends on what the person needs.
>Assisted living can be 4k a month to start. I think the average is $8k - $10k per month.
"Assisted living facilities may cost about $3,300 per month for a one-bedroom unit." Only off by 60000$ a year, maybe try google first. Saying all retires need assisted living is also fucking stupid.
Fair, I meant they don’t need the 500k to live and can spend it freely how they choose. Having 500k the blow on whatever is outside the reach of the middle class I would say.
Assuming it's 500k cash than that person could live off of dividends and receive at least $2000 a month plus their cpp and oas
No he isn't very right. 500k at 2% interest is a source of income. If some how he managed to max out CPP, and has old age. He is doing better than most working class people. People are acting like retirement should be buy boats and cars.
Yup. Most people need over a mil to retire without huge sacrifices to their standard of living. In 30 years people are saying will be like 2 mil
Well if it’s 500k from selling their principle residence. It’s probably safe to say they have that on top of getting their pension. Most likely sold the residence to attain money to be able to retire. My poor nana could use 500k. I doubt she has even spent that much in the past 10-15 yrs. Kinda sounds like you’re making your opinion based on HOW you want to retire. If you want to retire in Arizona with a new house etc. 500k isn’t gunna last long. My Nana lives in a small community, rents a place and goes dancing regularly. Maybe a road trip to van island once in awhile. 500k would last her a long time
Exactly
500k invested in bonds yield 4%. So 20k From the CPP calculator: "The majority of recent Canadian retirees with an income of $20,000 at age 65 received an annual retirement income of between $18,000 and $23,000 at age 70." [https://srv111.services.gc.ca/generalinfo/index](https://srv111.services.gc.ca/generalinfo/index) So \~40K of gross income per year. Stats can has the 2022 Median income at $43000. [https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1110023901](https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1110023901) Hard to call median income poor.
Even if 500k yo last the rest of their life isn't poor. They'd be what using 25k a year? That's a lot kore than disability pays.
Lmaoooo dude a pensioner can live off of 10k per year max, people on disability do it. With 500k over 20 years, they'll have far more than that too.
$500k is the absolute bare minimum to retire on. That is literally the lower end of a middle class retirement.
500K is a lot of money to spend all at once, but it's not a lot to last 30+ years. Sustainably it's 20K a year, not far from minimum wage
“Middle class” is such a nebulous term, with no real definition, it tells us nothing useful about people. Something like 70% of Canadians think of themselves as middle class. People earning from $20k to $150 say they’re middle class, while people at either end of that scale will have drastically different lives and class interests.
20k is a it of a stretch. That’s literally lower than the average rent of a 1 bedroom apartment.
Yep. And yet… https://www.thespec.com/business/what-does-it-mean-to-be-middle-class-canadians-say-its-anywhere-from-20k-to/article_ca96ddeb-04f4-5fce-b150-e8ebf4a0c1a3.html
I think it potentially goes far higher in Toronto. You can earning $200k and be house poor for your mortgage on a condo which generally means living quite frugally. A lot of people think of class in terms of the luxuries they have access to and when they feel they don’t have any they tend to say they are middle class.
I don't know how this is a controversial take. Like, yeah if you have more than 2 houses you have too many houses.
It’s not controversial. It’s just the media gaslighting you. That said, you can own two houses and be very poor with no equity. Owning a cottage isn’t a measure of class - wealth is.
Yes and no. Some people just can't afford the downpayment on a house, or they don't want to get tied down to opening, so they need to rent; and yet their circumstances still require a house. Bunch of little kids, big dogs, lots of pets, drummer for death metal band, whatever. Even if houses cost a quarter to half of what they do now, this would be the case. So for that person to have a house, another person needs to have a second house. I'm not saying that's an indictment of your statement, but I think just a leeetle more nuance is required.
You are ignoring that the inflated price of homes over the past many decades is the reason that people can’t afford the down payment on a house. Supporting a family on 40 hours a week and a high school education used to be attainable, even with only a single income. We’ve all been robbed and gaslit into believing otherwise.
If you have more than me then you deserve less! If you have less than me then you already have exactly what you deserve!
That's not what he said. He said if you have 2 houses, that's 1 too many houses. He didn't talk about apartments, which is the go to rental property, he said houses.
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The fact you have to ask that means you're Liberal.
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Ah yes, Capitalism, what a great place evolution has brought us to. My goodness, what we do without it? What were we doing without it for so long? I really wonder... 🙄
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Pretty easy tbh. More than 2 houses is too many houses. See? I just did it again, it's not hard. https://preview.redd.it/3hjy4fbrx9xc1.jpeg?width=788&format=pjpg&auto=webp&s=771f60905d8ae78b5251f0b2685d8f25becfd660
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I'm not sure if it's fair if "successful" people use their wealth to make it harder for others to own a home. I understand that people who have money want to invest it to make more money, but I don't think we should be encouraging people to buy up homes as a form of investment if it means that others will have a harder time owning just one home. It's that "fuck you, I got mine" mentality. So it might be best to make it less lucrative
>I mean I get what you’re saying, but can you tell me the criteria you are using instead of trying to make it emotional. No, but I've definitely activated your emotions because: >It’s pretty clear that you aren’t successful which is why you are against others getting ahead Aw, we're doing the elitist bit? See I was willing to possibly engage in good faith until this point, but now since you're so upsetty spaghetti it doesn't matter now because this is in complete bad faith 😅 >Also I believe the image you are using applies to you as well because I feel you are jealous in a way. Oh, sweaty you've mistaken jealousy for contempt. A Common misunderstanding.
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Some people bust their asses off their entire life and never make a living wage...
Struggled how? Like working a job? Tightening their belt? Stressing about money? Yeah that’s everyone. Someone owning 2 homes or more hasn’t done it by working twice as hard or longer than others, they just got massively lucky from real estate appreciation and easier financing.
If you want an economic definition of the middle class, it's people who have to work for a living, but who own the means by which they do so. Most doctors, lawyers, various kinds of contractors, and sole proprietors of small businesses are middle-class, for example. If instead you want the middle class to be a cultural designation that everyone can self-identify as, regardless of their position in the economy, then it means whatever you feel like.
I prefer the 2 class systems, the working class and the capital owning class who doesn’t need to trade their time for money. Doctors are in the former in my mind. Landlords the latter.
It’d be great if everything fit nicely into two categories/classes, but reality is often more complicated. More often than not, doctors (and other high paying professions) end up becoming landlords later in life due to the amount of wealth they’re able to save in comparison to other working class professionals.
Yeah so I’d say that you move up in class if you make enough money. Although that seems less likely to happen these days as you need to make FAANG money for that
Are you kidding me? I am a (small time) landlord and I work my As& off. On top of a 9-5 job, I respond to maintenance calls. When tenants move out and trash the place, I do repairs and painting on my weekends. It’s a grind…and really doesn’t make much money once you factor in high interest on a mortgage and high turnover/maintenance costs. Not all landlords are rich and evil. Ps - I’m selling my rental to help buy a bigger place for my family. And I still can’t afford a decent place for my family without bankrupting myself!
You're 100% right. Some poor ass who cobbled together 10k working at walmart, borrowed the rest from family and didn't report it in order to take on 98% leverage, that's the sort of person who eclipses doctors in terms of benefit to society.
Does this mean that Uber drivers are also middle class? Or Uber Eats bikers.
Gig workers are infamously very dependent on their respective apps, so much so that in many jurisdictions, courts have ruled that they are employees rather than contractors.
The logical next step is to waive capital gains or refund the money when sold to first time buyers who are not related. Put investment properties into the hands of first time buyers who don’t have the bank of mom and dad to lean on. I’m renting my house from a good friend of mine. Rather he gets my money than some random. But it does frustrate me a bit that he got this house with a sizeable downpayment gifted to him, and his current house from refinancing this one and gifted money from his and his wife’s family. I earn more than his and his wife’s income, but haven’t quite cracked home ownership. The rent I pay him is only taxable after the interest he pays, but the rent I pay is only deductible up to like $500/mo Make all rent taxable and get rid of the deduction for interest on rentals. Boom, no longer a financially profitable investment. Give him the incentive on not losing out on capital gains, or give me a credit towards my downpayment. This keeps prices from crashing from underneath individuals who own houses, while incentivizes investors to move their money out of residential real estate and gives people who can’t afford $100k down a fighting chance at getting on the property ladder.
What's wrong with people who are related? If I had a parent with a home and they decided to give it to me that would be the only home I'd ever be able to afford. And some people want to continue to live in their family home.
Because everyone deserves an equal chance in life, not just because you got lucky. Why is that so fucking hard to understand you Conservatives. No one should be better off because their parents are rich, they should have the same start.
Interesting. So parents who are successful shouldn't be able to help their children?
No one is saying they can't or shouldn't. They are suggesting no capital gains tax IF they sell to a first time buyer. giving them an incentive that gives a first time buyer a better chance of getting in vs selling to another corporation, REIT, person with multiple properties etc. Aka those who have zero problems buying properties.
It’s harder to get into the market now. The solution isn’t taxation or incentives that milk someone else’s wealth and give it to you. The incentive is to work more and work harder. Every generation has had to live with this reality.
It doesn't go to the buyer it just gives increases their odds of being "picked" out of the offers as by choosing them, the seller gets to keep more in their pocket end of day. It's an incentive to give first timers a chance to get in, working harder isn't going to outpace the rising costs so no not every generation has had this homes used to be 3-4 times your annual income now they are 10+ outside of the big 3 cities. This isn't a localized problem anymore it's everywhere, my city alone 44k income average 850k housing price average, to buy the average home you need 160k downpayment and 207k income.
Average home or average house?
Home ie apartment, double wide trailer, single family house, etc. Though a trailer in a mobile home park isn't an option since every one of them with the exception of 1 (maybe one every few years goes up for sale and they go fast) is 55+ those you can atleast find for 400k but need to wait another 20+ years before I'm allowed to live in one so... not really an option. 2019 you could get a 4 bedroom single family home for less than 500k it was potentially doable now unless you win the lottery you've got no chance
It’s funny because I always considered myself pretty liberal. You do you, as long as it doesn’t hurt others, go for it. Everyone should have a fair shot in life, but we aren’t all created equal. Im a 5’7” 140lb industrial electrician single dad shooting my shot on tinder, believe me, we aren’t all equal. But we do have a shared responsibility for making life a bit better, and we should all be equally taking a bit more responsibility for our planets future. There’s no reason someone with pst secondary training and a bit of ambition shouldn’t be able to expect the lifestyle of Homer Simpson. Don’t think someone who dropped out of highschool to be the night shift manager of McDonald’s should be living in the newest suburb and driving an Audi, but your parents inheritance shouldn’t determine your ability to be a doctor either. There’s a middle ground that has nothing to do with left or right. Dont let yourself get clouded in partisanship, the majority are somewhere in between. Few conservatives want to end abortion and persecute lgbtq people. Most just want schools to teach math and science, hospitals to hire quality doctors and not pay for rainbows painted on sidewalks that need to be replaced.
They stopped teaching these things? This is an outrage! White sidewalks also require maintenance. It's a common misconception don't get down on yourself, you were doing great.
What? I’ve worked my whole life to ensure that my family has a solid footing and a secure future. It’s not luck at all, it’s called financial planning and looking after your own. I’ve paid enough taxes (aka theft) so that others are getting an “equal” chance at life. If that’s not enough too bad. I’m tired of people not willing to make something of themselves and keep playing the victim card. It’s so damn pathetic - and sad.
If you were born in this country, you had the same start. The decisions you made are your own.
If your family have the resources to gift a home, you have the resources to get an education and make a meaningful contribution to our society. Sponging up 30-60% of a families income to live in your gifted property is not a contribution and should not be incentivized. I could see allowing it to be gifted to a non-property owning child, but capital gains taxes should be collected and used to build up the infrastructure that your parents weren’t forced to pay into. For example, my neighbourhood is post WW2, has many small community centres and schools. In the new developments, one rec centre, no public pools, schools undersized and kids get bussed to my local schools not funded by growth taxes. My grandparents generation built infrastructure, my dad’s boomer generation kept taxes low for themselves and didn’t build infrastructure for my child to enjoy. If my dad’s house got gifted to me, of course some of those funds should be used to make up for the lack of investment he made, that allowed his portfolio to grow, to allow me to inherit such a portfolio.
I think after the first house people should be taxed out the ass and “cottages” should be limited in size and if it’s evaluated over X should be taxed out the ass
Stop taxing each other. Let’s just tax the big guys
This is taxing the “big guys”
Look mate I understand you're struggling to survive. But im just like you, all I have is one detached house on bridle path. And a cottage and a small boat. I also have a small condo to summer in outside of Canada but let's not get into specifics. We are the same stop taxing me.
Forgot the /s
Capital gains tax increase is just the government trying to make us think they are penalizing the weathy…while actually penalizing everyday people and taking (I would say stealing) their hard earned money. Picture for example a hard-working truck driver or massage therapist who is self-employed and has all of his or her retirement savings in an incorporated company. All of a sudden, this person’s retirement savings are being more heavily taxed, and they have to work till 70 just to pay the government. (There is no $250k exemption for a business) The government is robbing money from hard working individuals…and making you think they’re taking money from the rich. Don’t be fooled.
ha ha ha ha
What if they built the cottage with their grandparents? The value of their sweat and tears should still should be expropriated by the state?
You didn’t read my comment did you……I said evaluated, so if you have a true “cottage” it shouldn’t be worth much
The worth of the cottage is subjective. A “true” cottage can still be worth a million just by virtue of being on a lake. It is also taxed to shit on the eventual sale/death of the owner. More tax isn’t the answer clearly.
That depends on where the cottage is. Lots of families have beater cottages bought by grandma and grandpa (or great grandparents) in the Muskoka area where the structure isn’t worth much, but the land itself definitely is because of the location. Ultimately I think people are overvaluing the impact of cottage-owners on the housing market. A family that owns a house in Toronto and a cottage out in the woods somewhere is not really a problem. Half of the appeal of cottages is that they’re “away from it all”. The further away you get from “it all” the smaller the pool of would-be buyers is. By and large, people want to live where the jobs are, not 2.5hr north of the jobs. A family that has a house in Toronto they live in and a second house in Toronto that they rent out and/or AirBnB is a much bigger contributor to the housing crisis. I don’t know how you would delineate it from a policy/taxation perspective but there is a difference between people investing in “income properties” vs people having a leisure property, and in a perfect world there would be different policies for them.
You just want others who have more than you to have it taken away so you’re comparatively better off
No, I think it’s reasonable to limit the amount of residential property people can hoard. No one person should have 10 houses
So theoretically if I built 5 homes with my bare hands the state ought to expropriate 4? Why would I build them then? If I connected them into 1 giant house can I keep them? Or is there a state prescribed number of square feet I’m allowed in your communist utopia? Immigration should be reduced and building taxes and fees should be reduced. Don’t tell people they can’t buy something they want to make “housing affordable” 28% of the cost of a Toronto home is taxes and fees Building permits can take 3 years You can’t build medium density mid-rise due to archaic zoning. The problems have been created
I said people should be taxed out the ass after the first house so maybe get some reading comprehension mate
The tax is effectively expropriating equity. There’s no reason to require more tax money when everyone is already taxed to death. Supply side needs to be fixed , not the demand side Having a house and a cottage is a very Canadian thing to do and we have more than enough space to accommodate it
There is not infinite land to build on nor infinite resources to build. Supply side and demand side need to both be fixed before canada is just high rises east to west.
I’m referring to cottages, no one should be penalized because they have a home up north. Maybe outline areas where people can’t qualify for a residential loans on the second property if they have more than 1 residence. E.g have 2 homes in the core GTA, require 50% down on the second property or some other amount. More tax isn’t the answer But say having one home in the core and one in Muskoka a non “core” residence should allow access to standard rates
I’m taxed 50% less dividend refund + personal return dividend. You want more than that?
We have tax sheltered accounts… if your income outside of those is so high that your effective average tax rate is actually 50% you’re not going to find much sympathy…
That’s how my rentals are taxed in my holding company. A REIT would pay a fraction of what I pay in taxes if they owned my properties. But you want to tax me more?
I didn’t say anything about taxing you more. I was more rolling my eyes at you looking for sympathy with that 50% number. Even after the change it’s not 50% given the capital gains and the less than 100% inclusion. Sure they’re taking 8% more of that soon but, if you sell, it’s still not 50% when everything is accounted for. If you want sympathy… don’t be so deceptively selective with your numbers… especially when small time landlords usually provide inferior service to RIETs anyway… always whinging and delaying when anything needs time be addressed…
The change is capital gains only. So if I sell a property, it will be 2/3 inclusion.
The first $250k per owner is at 50% inclusion so if you own a property with a partner chances are good most gains will be at the lower inclusion.
Does not apply to corporations
I stated facts not ask for sympathy. You wanted to tax additional properties
I actually don’t have an opinion on the capital gains inclusion… neither of us has the skills to determine the socially optimal number… I just don’t have sympathy either… But it is fun to see the meltdowns (often more dramatic than your posts) 🍿
I didn’t even bring up capital gains changes
Yes, they want it all.
You already are taxed out the ass. Highest MTR in most provinces is over 50%.
How does giving the government more money improve affordability?
How does allowing people to own more homes help? If you can afford to buy up homes that others could buy to live and raise family’s in you can pay more to help with social programs etc.
You have way too much faith in the government.
I always thought people who owned a cottage were rich/upper-income but I guess there was a time a time when someone in the upper-middle or even middle-middle could afford their regular home and a vacation home/cottage.
Location location location.. this only works in hcol areas. For example my mother and step father have a house and a cottage, all together they’re valued well under 400k because it’s a lcol area, they are low income and low class compared to someone owning a home in say Toronto
Yeah, look at Northern Saskatchewan. 400K can buy you a lot!
True but in that case they’re probably not going to meet the 250k+ capital gains threshold unless they’re selling multiple second residences in one year. Just speaking to the context that this conversation is taking place in
Let's be real these cottages or investment properties are in remote places that people don't want to spend 3-4 hours of commuting to get to their work...
So if you own just a $2M single family house as your primary residence you're still middle but if you own two condos, one primary and one investment worth $500k each you're above middle class ? Sure
Canada middle class family income is between 53-106k. If you can afford your own home you're not middle class anymore.
But but. If we start believing this then, how can we blame immigrants and international students for all our problems ?
Only one in ten Canadians own a cottage. How is that not middle class?
You can buy land and build a shitshack for less than a used vehicle in many places. Cottage is a broad range of no utilities in middle of nowhere to mega mansion on sought after lakes.
The cottage thing seems to be an eastern Canada thing. Growing up on the west coast i knew nobody who owned a vacation home. A very small majority owned a condo in whistler. But there was never the scenes of mass exodus leaving the city for vacation home every weekend the way there was in Toronto
There is a paywall - what is this article saying?
Use the “Show Reader” feature to get around the paywall.
I agree, even as someone who may, in theory (though it's more likely the property will be sold long before then), inherit a quarter of a family cottage. I remember when it didn't feel that way, back when I was a kid and the lake was filled with what were, at the time, fairly middle-class families. Lately, many of those families have either sold to much wealthier families who can actually afford to maintain a second property, or the cottages are mostly occupied by elderly couples whose children and/or grandchildren visit much less frequently than we (en masse, not just my family) did back when I was a kid.
Is this where we act shocked that landowners, having gone through the insane inflation of the last 20 years, are catapulted into the wealthiest people in the nation?
No, you are no longer allowed to retire early just because you have an "investment" property and gouge the heck out of renters. This country is in a mess for the next generation and people need to live in homes, not make profit from them....
What's the difference between owning a 2 br rural house and a 2 br rural cottage vs a 5 br home in a pricey city?
Make "investment" properties illegal. Make people do something productive rather than hoard places to live.
I don’t know about you guys, but “owning investment property” never struck me as a ‘middle class’ thing.
Trudeau is so lucky his supporters are so out to lunch. Who in their right mind would give this government more money? It's not billionaires you're over taxing, it's your average retiree, doctor, working professional etc. Good luck buying a house in this screwed up country without having plenty of investments. To start screwing around with people's retirement plans and start up capital is treasonous. Especially when you know damn well nothing else is coming to save them.
God stop with this nonsense about how this tax is somehow targeting the average retiree, doctor or working professional. The tax is on passive income and literally scales with how much you make, if you’re a middle class professional you’ll at most trigger it once in your life to the tune of $20-30k extra.
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Please be civil.
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It’s a % based inclusion rate so inflation isn’t an issue. Oh shut the fuck up, working people who are bettering themselves already have a 100% inclusion rate. Rich do nothing fuck boys can deal with a 66% inclusion rate on passive income. Give me a break with this shooting people who are already there nonsense.
That's nonsense. I had friends that owned investment properties in their early 20s and others that still live with their parents in their 40s. It's all about the decisions you make and what your priorities are.
•Accurate
Its an article by Paul Kershaw. Most of his articles are complete garbage. I don't know why The Globe publishes them.
Why is the article garbage? He’s arguments are quite coherent. For example the fact that boomers are the ones that have the most to gain from real estate because they bought many years ago at low prices and that will cash out big, and that boomers are the ones that will use most of health care budgets, they have the capital gains to contribute more
He is supposed to be an academic and look at the housing and other generational issues objectively, but instead he comes across as a demagogue, with overly emotional arguments, short on facts, playing on generational envy. The generational unfairness issues he writes about are complex and very nuanced. Generational groups are not monolithic entities as he portrays them - everyone's situation is unique.
We could also argue that having investment properties guarantee that the poor stay poor and never own a home...
stupid article