Plus, the bank pushed back the date at which it expects the Canadian economy to close its output gap — to the end of next year from mid-2011. Still, it opted for a rate hike as the “underlying dynamics” for inflation are little changed, with both headline and core inflation expected to remain near the bank’s preferred 2% target up until the end of 2012.

The central bank’s benchmark rate now stands at 0.75%, an increase of 25 basis points, and marks the second straight rate hike. The Bank of Canada remains the only central bank among its Group of Seven peers to raise rates following the recession.

Read the  Announcement.

What is Assignment?
A common question raised during the pre-construction process is assignments. For those who are not familiar with assignments, it is simply a sales contract entered into by two parties at an earlier date. It is essentially a transfer of the right to purchase that property from the original purchaser to a new purchaser prior to the unit closing. Assignments of sale are very common during the construction stage of new developments by allowing the original purchaser to resell their unit before the sale is completed for the property. Since units in pre-construction are purchased sometimes 3-4 years prior to occupancy, sellers often choose to assign their units before they occupy as their lives may take on a different path. On the flip side, a lot of purchasers may look for assignments to buy before the building is complete. Once construction has started, there are always many assignment agreements floating around as occupancy dates become more accurate. There are however many stipulations that are involved when selling or buying an assignment.

They are as follows:

Selling an Assignment
The first step that should be taken when considering assigning your condo is whether you are indeed allowed to assign your contract. In most cases the developers will have certain rules that must be followed. For example, some new developments in Toronto stipulated that at $2,500-$5,000 administration fee must be paid, 80% of the building must be sold out, the floor plan that you have purchased must be sold out, it cannot be advertised on MLS, and the builder must give permission for assignments to take place. Once all the criteria have been met, it is recommended that you speak to your lawyer to assist you with assigning your condo.

Buying an Assignment
The first step that should be considered when purchasing an Assignment Agreement is that the assignor is indeed allowed to assign his condo. There can be serious ramifications from the builder if units are assigned without the builder’s permission. The process of purchasing an assignment is quite different than your standard real estate transaction as you are purchasing a contract from the original owner of that contract and assuming all of their rights and obligations. Here is an example of how an Assignment works:

Original Purchase Price: $400,000 put down 15% deposit

New Purchase Price: $460,000

*Difference: $60,000 + $60000 (15% deposit) = $120,000 – This amount is paid to the original purchaser of the Agreement of Purchase and Sale

Once the assignment fee is paid to the original purchaser, the new owner is obligated to pay the original purchase price of the property as per the terms of the original Agreement of Purchase and Sale to the developer.

When dealing with assignments, it is extremely important for both the assignor and assignee to seek legal advice as these transactions can sometimes become very challenging. When handled correctly, assignment can have a mutual benefit to both parties involved.

Beginning July 1, 2010, there will be sales tax in Ontario of 5% + 8% = 13% (12% in British Columbia) replacing the former 5% GST (Goods and Services Tax) and the  former 8% PST (Provincial Sales Tax).

1) HST and  Mortgage Brokerage Fees (to arrange a mortgage, if one uses a Mortgage Broker)HST will not apply since mortgage brokerage services are exempt as part of the financial services industry.

2) HST on Real Estate Commissions

Generally, HST will be payable on commissions for any real estate sale closed after July 1, 2010.  However, the
general transitional rule (for sale contracts entered into before July 1, 2010), is if at least 90% of the services
were performed prior to July 1, 2010, only 5% GST is payable (no PST).  If an offer to purchase real estate was
accepted prior to July 1, 2010, then the realtor services were performed prior to July 1, 2010, and only 5% GST
should be payable even though the realtor’s commission is not due for payment until the sale has closed after July
1, 2010. Warning to sellers: If, prior to July 1, 2010, a seller is about to accept an offer to purchase (which will
close after July 1, 2010), the seller should clarify in writing with the realtor that only GST will be payable on commissions due on a sale closing after July 1, 2010.

3) HST and Rents Paid by Tenants

For residential tenancies, HST will not apply to such rents.  For commercial tenancies (industrial, office or retail), HSTwill be charged on rents paid after July 1, 2010 (but most commercial tenants qualify to recover such HST payments through input tax credits).

4) HST and Condominium Monthly Maintenance Fees

For residential condominiums, HST will not apply on monthly common expenses,  but HST is payable for
commercial (retail), office, industrial) condo common expenses paid on or after July 1, 2010 (most commercial
condo owners  qualify to recover such HST payments through input tax credits).

5) HST on HOME RENOVATIONS

For any part of services (labour and materials) provided after July 1, 2010 (no matter when a contract for
renovations of a residence was signed), the part performed or provided after July 1, 2010, will be subject to HST.

6) HST and RESALE COTTAGE / VACATION PROPERTY PURCHASES

HST will not be payable on the price if the property sold by the seller and bought by the buyer is personal use
property.  However, if the seller had been renting out the property more than 50% of the time during the seller’s
ownership, the price will likely be subject to HST.  If the  property being sold was part of a rental pool, HST will
apply.  Consult your tax accountant.

7) HST and RESALE RESIDENTIAL PROPERTY PURCHASES

There will be no HST on the price of resale residential purchases.  Note: Resale residential purchases will
therefore become a much more attractive investment (rather than buying from a builder) particularly when one
considers that builder prices will result in 13% HST (whether built into the price or being structured in addition to the price by some builders in Ontario).  Builder prices also must include higher increased current costs of labour, materials and land costs as well as substantial municipal levies and educational levies plus sizable closing adjustments (often being hidden by builders in the fine print of many pages in a builder’s agreement), all of which are not payable by a buyer / investor who purchases resale residential property. (Think about it!)

8) HST on a PURCHASE OF A SUBSTANTIALLY RENOVATED HOME

If a residence being purchased has been “substantially renovated”, it will be treated in the same manner as buying new construction from a builder and HST will generally apply to the price paid.  See Canada Revenue Agency (CRA) Bulletin B-092 which states that a “substantial renovation”, in  effect, refers to a renovation where at least 90% of the interior of a building (excluding the foundation, external walls, internal supporting walls, roof, floors and staircases) has been
removed or replaced.

9) HST and PURCHASE of RESALE APARTMENT BUILDINGS (Multi-Unit Residential)

No HST will be payable on the price of a resale apartment building (multi-unit residential).  If part of such a building is commercial, the purchase price must be reasonably apportioned between the part of the building that is residential resale (HST exempt) and the other part of the building that has a commercial component, which part will be subject to HST.

10) HST on PURCHASE OF COMMERCIAL PROPERTIES (new or resale commercial properties closing after July 1, 2010 no matter when an offer was signed)

HST will apply to the purchase price; however, typically, buyers who obtain a GST registration prior to closing
(must be registered for GST in the same manner as ownership will be taken) will not need to pay the HST on
closing provided:

(a) a GST registration is obtained prior to the closing date, and

(b) the buyer signs an appropriate undertaking in thelawyer’s office to become self-assessed.

Note: Watch out for the purchase of office condominiums, industrial condominiums, and retail condominiums, the price for which will be subject to HST (being subject to only GST on the price for closings prior to July 1, 2010).

11) HST and the PURCHASE OF VACANT LAND

(a) FarmlandHST will typically apply to the price of such land if farm land is sold alone; however, if the land is sold as part ofa farming business, it can be treated differently.  Consult your tax accountant.

(b) Building Lot
HST will typically apply to the price when the seller is involved in a commercial real estate activity; however,
some lot sale prices might be exempt from HST if the seller is not engaged in a real estate commercial activity.

(c) Personal Use Of Vacant Land
No HST is payable if an individual sells personal use vacant land (which would have been exempt from GST).

12) HST on PURCHASES OF NEWLY CONSTRUCTED RESIDENTIAL PROPERTY

(a) Builder’s Agreement Prior to June 19, 2009
No HST is payable if an offer to purchase from a builder was accepted prior to June 19, 2009 (only GST willapply; however, most builders include GST inside the sale price).  Note: Buying by way of an assignment (where the builder sale agreement was signed prior to June 19, 2009) becomes attractive!

(b) Builder’s Agreement Accepted after June 18, 2009
If an offer to purchase from a builder was accepted after June 18, 2009 and either occupancy closing (for a new
condo purchase) or final closing occurs prior to July 1, 2010, HST is not payable;  HST  is payable  if both
occupancy (in a new condo purchase) and final closing occur after July 1, 2010.

(c) If Builder’s Agreement Silent about HST
If an offer to purchase from a builder was accepted after June 18, 2009 and failed to make reference to HST, the
sale price includes Ontario’s 8% PST component of the HST if it is payable (which means that the builder must
pay the PST and cannot charge it to the buyer).

(d) GST Rebate (calculated on the 5% GST part of the 13% HST)
Typically, most builders include the GST component of HST (being 5%) in the sale price based on the government
GST rebate being assigned from the buyer to the builder (such GST rebate being 36% of the GST payable on the
first $350,000.00 which is reduced to NIL as the price  increases from $350,000.00 to $450,000.00, there being
no GST rebate after $450,000.00).

Note: In order for the GST rebate to be assigned to the builder by the buyer, the buyer must qualify by the buyer
or an immediate family member living in the unit.  If not qualifying (such as an investor who will be renting out the
unit), the rebate cannot be assigned to the builder and the builder will charge the cost of such unassignable rebate to the buyer on closing in addition to the purchase price, which results in the buyer being forced to make a separate
application to the federal government to recover such rebate.  To qualify for recovery of such rebate, the investor
must own the unit for at least one year and reasonably expect to rent the unit to the initial tenant for one year.
An investor need not wait the year to apply for and obtain the rebate but if the government later discovers that
ownership was less than one year, the government might seek to recover the rebate paid to the investor.

(e) PST Rebate (calculated on the 8% PST Component of the 13% HST)
Warning: All builder agreements should be reviewed by a lawyer either before a buyer signs an offer or during
any available cooling off period since some builder agreements require buyers to pay the 8% PST (or the
Net PST) component of the HST in addition to the purchase price.

Regarding a PST rebate, only 75% of the 8% PST component of the HST is refundable to a buyer on
the part of the purchase price that is up to $400,000.00 (being newly constructed from a builder since there is
no HST on resale residential property).  There is no government rebate on the 8% PST for the part of
any price that exceeds $400,000.00!  This means that 75% of 8% (being 6%) is refundable by the government
and 25% of 8% (being 2%) is not on the first $400,000.00 of price.

Example: If the price from a builder is $500,000.00, the gross 8% PST component of the HST would be $40,000.00, but since the government offers a rebate of 75% of the 8% PST on the first $400,000.00, this
will effectively (for a qualifying buyer whose immediate family member will be living in the unit) reduce the PST
to 2% on the first $400,000.00 to $8,000.00.  Since there is no PST rebate for that part of the price over
$400,000.00, 8% is charged on the next $100,000.00 being a further $8,000.00 which means (for a qualified
buyer who can assign the rebate to the builder) that the total net PST payable is $16,000.00.  If the net PST is
not included in the price of $500,000.00, the price plus net PST payable becomes $516,000.00.  The gross 8%
PST on $500,000.00 is $40.000.00 but (due to the rebate of $24,000.00 on the first $400,000.00) the net
PST payable is $16,000.00.

Note: If the builder’s agreement requires the Net PST to be paid by the buyer, the buyer pays $16,000.00 on top
of the price.  If the builder’s agreement states that the NetPST is included in the price (as GST is typically with most

builders), the price remains $500,000.00.  Watch out!Caution: An investor-buyer who will rent out the unit will
not qualify for assignment of PST rebate to the builder and, therefore, on closing, must pay the purchase price
of $500,000.00 plus the gross PST of $40,000.00 (being a total of $540,000.00) and then, after closing
apply to the government for the rebate of $24,000.00 to be received if the investor qualifies (must be owning
for one year and rent to a tenant who is reasonably expected to live in the unit for one year, although the
rebate application can be made as soon as the purchase from the builder is closed).

(f) Qualifying  for a Rebate (GST or PST) whenBuying from a Builder
In order to qualify for GST or PST rebates, the property purchased from a builder must be intended to be a
primary place of residence, which means that if a person has more than one residence in the world, (in order to
qualify for the rebate) the unit must be the main place of residence and not a secondary residence.

Also, the residence purchased must be used as a primary place of residence (as stated above) by the buyer or a
relation of the buyer.  Relation of the buyer includes an individual who is related by blood, marriage, adoption or
common law (including a former spouse or a former common law partner).  Blood relation is limited to parents,
siblings, children, grandchildren but does not include cousins, uncles or aunts.

(g) Additional Transitional PST rebate for NON-CONDOMINIUM Builder Purchase (where
part of construction was done as of July 1, 2010)
If HST is payable on a newly constructed home (not a condominium) and if construction of the residence was at least 10% complete as of July 1, 2010, a transitionalPST rebate of up to 2% of the sale price can be claimed on the PST component of the HST as follows:

% Completed As Of July 1, 2010     Portion Of 2% Of Price To Be Refunded
10% – 24%     25%
25% – 49%     50%
50% – 74%     75%
75% – 89%     90%
90% – 100%     100%

Example: If buying a freehold townhouse, a semi-detached or a detached from a builder for $500,000.00 where
construction was 95% complete on July 1, 2010 and closing occurs on July 15, 2010, PST rebate for qualified
buyer will be:

(i) 75% of 8% on the first $400,000.00 =  $24,000.00
(ii) 100% of 2% on $500,000.00  =  $10,000.00
Total rebates      $34,000.00

Instead of paying a gross PST of 8% on $500,000.00 being $40,000.00, the rebates of $34,000.00 would
reduce the net PST payable to $6,000.00.  The question is whether such Net PST is included or not included in the
purchase price from the builder according to the terms of the builder’s agreement!

Note: The PST transitional rebate of up to 2% of the purchase price can only be obtained if:

(i) HST is payable on the price where the builder’s agreement was accepted after June 18, 2009 andcloses after July 1, 2010;(ii) the purchase is for new residential construction which is not a condominium;

(iii) construction is at least 10% complete as of July 1, 2010;

(iv) a certificate is obtained on closing from the builder stating the percentage of completion of construction as
of July 1, 2010.  Note: the builder is not required to provide this to a buyer unless the terms of the purchase agreement with the builder requires such a certificate to be provided; and

(v) an application for a transitional PST rebate is filed with the government by July 1, 2014.

(h) CONTACT  TELEPHONE NUMBERS FOR HST TRANSITIONAL RULES
Ontario has proposed transitional rules that assist businesses in the transition to a Harmonized Sales Tax (HST).  Formore information on the transitional rules for the HST, please call Canada Revenue Agency (CRA):

I received this great article from Stephen H. Shub, Barrister &  Solicitor,  1 (800) 959-5525.

Today’s home builders offer a wide variety of energy efficient options. These range from certified Built Green or R2000 finished homes, to individual features such as high efficiency heating systems, upgraded insulation and ENERGY STAR appliances.

Whether you’re building or buying a new home, ask your builder about the following energy efficiency features: High Efficiency Heating Systems; Air Sealing; Upgraded Insulation; High-Performance Windows; Energy Efficient Appliances and Lighting; Water Conserving Toilets, Faucets and Showerheads; and High Efficiency Water Heaters.

An energy efficient home is healthier and more comfortable. Using the features above will reduce your energy costs by up to $1,000 per year, provide a higher resale value and reduce your greenhouse gas emissions by five to seven tonnes per year.

“The strong rebound in the existing home market was one of the initial drivers of economic recovery,” said TREB President Tom Lebour. “While we don’t expect to see the same rates growth moving forward, GTA households will remain confident in ownership housing as a quality long-term investment, especially as economic recovery expands across all industries.”

The annual rate of growth for new listings continued to accelerate in March. The number of new listings grew by 42 per cent compared to March of 2008. “The average home price in the GTA will continue to grow this year, but the pace will slow as we move through the spring,” said Jason Mercer, TREB’s Senior Manager of Market Analysis. “As growth in new listings starts to outstrip growth in sales, buyers will experience more choice, resulting in more sustainable single digit rates of average price growth.”

- In order to qualify for an insured mortgage, borrowers will have to meet the standards for a five-year fixed-rate mortgage — up from the current standard of three years.

This does not mean that a consumer will no longer be able to receive a variable rate mortgage or a term less than 5 years.  What this means is that a consumer must be able to afford the payments and interest of a 5 year mortgage product, in order to qualify for the lower Payment and Interest typically associated with a shorter term or variable rate.

- If prospective home buyers want to purchase a property where they will not be living, they will have to come up with a 20% down payment.

The 20% down-payment is aimed at the real estate speculation market.  It will help prevent people from buying 5 or 6 condo apartments in the hopes that they will sell quickly once the unit is completed.  This should not affect the person buying a second home or cottage.  It specially targets the investor who will not be living in the property, and has no intention of living in the property. As a consumer, you can still expect the standard 5% (residential dwelling) down payment.  Commercial Mortgages are unchanged.

- Instead of being able to borrow 95% of a property’s value, the limit will now be 90 %.

This is not a bad thing; in fact, a good mortgage broker/agent should be making this recommendation regardless of a new law being passed.   This rule means that consumers will need a borrowing strategy that goes beyond just getting a chunk of money.  You should now consider paying your high interest debt (Trust Company Loans, Pay Day Loans, High Interest Credit Cards, Department store cards) and leaving low interest products (line of credits, premium credit cards) as is.  You will still save on your monthly payments.

I will be a good person to work with –I will not be territorial — I will not be a jerk.

A great organization should consist only of people who absolutely love what they do, and have the utmost respect for individuals in a collaborative, egalitarian, and meritocratic environment. So, no blind copying, no politics, no parochialism, no silos, and so on. But we don’t live in a perfect society, therefore we’re bound to run to jerks every now and then. There are alls sort of jerks: the credit grabber jerk, the weakling jerk, the shylock jerk, etc. etc. etc… but in my experience, the charismatic a**hole is the worst jerk ever. They tend to be in senior positions, and are  pretty darn seductive: smart, charming, capable on occasion of making you feel like you too, are smart and charming and the most important person in the whole world. Some of the most interesting people I’ve worked for/with have been charismatic a**holes. Even though I didn’t trust any of them, I was still on occasion sucked in to their orb by sheer magnetic force. :-)

Hopefully at days end there will be less ferks I mean jerks in the world and ultimately we will all live in a better place. Let me end this with what the Borg say: “Strength is irrelevant.Your GCI is irrelevant. Your resistance is futile. We will strip off your jerkness (is there such a word?). We will add your biological and technological distinctiveness to our own. We wish to improve ourselves. Your culture will adapt to service ours.”

:-)

In our line of business, we need to be successful — there are many ways to avoid success in life, but the most sure-fire just might be procrastination. From time to time I procrastinate and believe you me, if we procrastinate, then we are sabotaging ourselves. This puts obstacles in our own path, and this hurts our performance.

So why do we procrastinate? Fear of failure, fear of success, fear of losing autonomy, fear of being alone, and fear of attachment are some very good reasons. In a nutshell, because we expect ourselves to be perfect.

If you think you are a procrastinator, take heart! No one is beyond help. The fact that you procrastinate does not mean that you are inherently lazy or inefficient. Your procrastination is not an untamable beast. It is a habit that has some specific origin, and it is a habit that you can overcome.

So how do we fix it? People have written books on this, but let me give you the short and sweet answer: “Hold urself accountable.” When it comes to building a career, the buck stops with you. The definition of accountability is to be responsible for your action. Being accountable for our goals can help us to increase our chances of achieving it. I think most of us set goals in private and do not dare to share it with others. Once again this may be due to shyness or fear of the possibility of others mocking at our goals. But keeping our goals to ourselves may be our biggest mistake that caused us to fail. If we are really scare to declare our goals publicly, the more we should do it. Why? It is because doing this will allow us to use fear to our advantage.

Once our goals are known to the public, it will make us fearful of what they will say to us when we do not achieve our goals. Either way, fear is going to be present regardless whether you are sharing your goals with them or not. So why not use fear to your advantage?  It can be frustrating if you constantly fail to achieve your goals. Set your goals and do it differently this time round. Be accountable for your goals by announcing it publicly through forums, blogs or find an accountability partner. Once you are accountable for your goals, you will unleash your hidden potential and find the extra strength to help you achieve it.

Cheers to our success. So let it be written, so let it be done.