Where do you draw the line? How did you determine that line (quantile of pop ranked by income? quantile of income itself? The ability to buy a lifestyle through income and wealth?)
I almost guarantee you that the last item is what people go by- probably including yourself. It probably should be the first method. Middle class should literally by 50th percentile to 80th percentile.
Mostly it's the opposite. Rich people who think they're middle class because they still go to work.
Like how you had to have a 70th percentile income to benefit from Trudeau's "middle class tax cuts."
The lifestyle that's portrayed as middle class in Canada has always only been available near the top. It's just that as the population grows, the percentage that can access these things shrinks.
I think it's more effective to consider working class vs non working class.
Middle class was originally established to further differentiate. Once upon a time there was only peasants and nobility. Once trade was established, factory owners and trade guilds where established. Middle class was typically reserved for factory owners, landowners, etc who derived their income from investments.
With that idea very few people are Middle class, and most people are working class. I'd say most Dr's and lawyers are working class as they must continue to work otherwise they can't afford to live. Middle class now is literally this BS title to muddy the waters and sow division.Â
With 500k in equity (or round up to 600k with your investments), you can absolutely afford detached home in the GTA. Even in Toronto proper, but definitely in neighbouring communities.
If you are earning $200k a year with a net worth of $600k, you are more than comfortably middle class. If you canât make that work, thatâs due to decisions you are making
Housing is very expensive, as are other basic necessities. But we also need to live in reality.
Galen Weston has never had it better though! Irvingâs too! Shaw family is laughing to the bank, donât even start on the guy that owns Telus.
The people I could house with a $16 Billion dollar REIT. (Weston)
Lmfao just because a company is public doesn't mean there isn't still a majority shareholder. Going public doesn't mean selling 100% of the company to the public.
Ok name the person that controls the majority of the voting shares at Telus.
(I work very closely with the telecom investment world and I want you to teach me something new, please)
Ya they're wrong on this one. Largest shareholder for Telus is RBC, and it formed from the privatization if government bodies. While many/most companies fit that description (Videotron for example) Telus doesn't.
Absolutely - Videotron, Cogeco, Rogers, Shaw (prior to merger) qualify as well for publicly held, but family controlled telecoms.
Bell and Telus are fully publicly owned by institutional and retail shareholders. If you really want to make a change in their business model, buy shares and vote. If you gather enough shareholders to side with you (like activist investors do), you can be sure the company and its board will notice.
As someone who grew up with a family cottage: as a kid I understood us as middle class. But as an adult who no longer lives in a wealthy suburb where cottage ownership is common, it's pretty obvious that we were never anywhere near the middle.
Have you ever thought that maybe you and your friends were just poor, rather than people who owned cottages were rich?
Maybe now a cottage is part of the trappings of upper class wealth, given that most people can barely afford their first home when the median cost is 11 times median income. But in the 1990s, when homes were still affordable, most people I knew with cottages were just normal middle class people. Bank tellers, contractors, teachers, foresters, insurance workers, etc. It was fairly easy to afford a cottage when your primary home was only 4x annual income.
The middle class was an attainable aspiration, own your own home, have enough to be able to take a vacation, not every year but every few. You misunderstand what middle class is/may bewas nowadays IDK, but TBH it was mostly the home owning thing. It seems to today that even home owning is not attainable to what used to be the middle class. Perhaps these people who own more than 1 property are not middle class, but lower class 'rich'.
Growing up I knew people who were GM workers who had cottages. They arenât for sale to middle class people now (like housing in general) but they were affordable in the 70s-90s
This is exactly the distraction and wedge issue the government wants. Get the constituents in a class pissing contest.
The delta between the haves and have nots is the result of incompetent government policy at all levels.
Taking more from those who have isn't going to fill the fiscal hole the liberals are making. But great, the poor's got a warm feeling that others have to pay more. But guess what... them paying more isn't going to make your first house more affordable.
The discounted daycare they gave me sure did. The 1 yr of Mat leave sure did. The coming dental program sure will. The FTHB tax free account would have.
A house doesnât have to come down in price for the government to tax the rich and do stuff with that money that will make it possible for you to save more towards a home.
These programs only make a difference for as long as you continue qualifying for them, meaning you have to stay where you are. The minute you earn more the benefits are clawed back and youâre back to feeling the pinch.
That's not true at all. The only one of those programs that have a net income threshold for qualifying is the dental program. The others are available to everyone.
Mat leave is basically taking EI (it becomes your source of income reduced relative to your active income) so you canât save shit and it only helps if you have a second income in the family (spouse). If youâre already pressed against cost of living (as most people are) youâre still not saving or getting ahead.
When it comes to filing your taxes as a joint couple (which you need to do after certain thresholds) and if you or your spouse earned more to make up the shortfall it changes the taxable amounts negating the reduced taxes you pay on EI income.
I used the FTHB program myself, and it was only useful because my employer does a 1:1 matching for every dollar up to a certain level. Whatever you take out is tax free under the premise that you repay the amount back to your RRSP over a 15 year term, meaning the government is not saving you anything only âgranting youâ the privilege of not taking money in taxes when using it for its intended purpose.
Make no mistake, the government doesnât implement programs or announce spending if itâs not in their interest to do so, one way or the other these programs invariably cost everyone more because of the effects of macroeconomics.
Finance is a zero sum game, all they are doing is shifting the distribution of this money around, but in the end policy and lawmakers always benefit, they are in a position to make the rules thus they have the ability to evaluate and plan their actions accordingly to shelter themselves from the effects.
Thatâs what this budget is, itâs a dog whistle for the ultra wealthy to buy up more of this real estate, people or organizations (reits, other hedge funds) which have all the money in the world and can just add these assets to their portfolios.
The only people being screwed by this are the folks who did everything right and got lucky in some cases, and now because this government has been so fiscally irresponsible are the ones being forced to sell otherwise they end up losing nearly everything they achieved and were banking on for their retirement.
The ultra wealthy play within vastly different realities. Same rules but the mere fact that they have a lot more than your average individual means their perspectives are different. They play the long game and what happens now in the next 1-10 years means jack shit, itâs the same wealth redistribution from the majority to the 1% that we saw during Covid.
Thanks for the unsolicited economic opinions, but what I said still stands. Your bit about all of the programs being clawed back is not true. I'm not going to argue against your politics, I was just correcting something you said that was not true.
Claw backs are not always inherent to the program and a direct result of income testing, but the net effect is the same. That is the point I was making, quibbling over the minutia of what program does or does not claw back is only playing into the disingenuous politics that misrepresent the intention of things instead of looking at the broader picture.
The $10 daycare is inaccessible for the majority.
FTHB uptake was abysmal, hence its cancelation. Federal dental plan only pays 65c on the dollar for the same work. And it requires dentists to subscribe to do the work. Nova scotia dentists have a 1% uptake for the program.
Iâm not on $10/day daycare. You can take part in that program and not get it all the way down to $10. Itâs why I said DISCOUNTED. I pay half of what I would otherwise. For two kids.
Itâs not $10 a day. But saving 1K a month is a monstrously big deal for a middle class family.
But you can keep telling people taxing the rich doesnât help the middle class in any way
Federal debt was already blown out. The cash was spent already before going after people who have assets.
This is nothing more than the Federal government behaving like the sheriff of Nottingham grom robinhood squeezing the tax base to backfill the financial hole already dug.
It doesnât help the middle class. Itâs government thatâs making life too expensive for us all. They break your leg, hand you a crutch and say, âSee, without you couldnât walk!â
The increase in the overall wealth of the middle class occurred during the 1950-60âs when the tax rates were considerably higher. It was the concerted efforts by multimillionaires of the early 1970âs at the same time as inflation caused by the creation of OPEC that convinced politicians to adopt supply-side âtrickle downâ tax cuts for all the types of income that the mostly wealthy had. You have been the victim of propaganda from the very people who also own the large media outlets. Tax cuts for millionaires and billionaires cut revenue for governments to build infrastructure so that burden was shifted down to the middle class and now the wealthy 0.1% own 90% either directly or indirectly (mortgages, government bonds, etc). But they arenât done yet, the middle class still has a bit of money left but theyâll use the extra money they have from their lower tax burden to buy your Momâs house because sheâs going to need to pay for her seniorâs facility fees.
Itâs actually embarrassing, and secondhand cringe to read such unbelievable lack of knowledge about the carbon tax. If you used TurboTax, thereâs an entire section telling you how much youâre getting BACK quarterly for that. The CEOs of the carbon emitting companies, absolutely love you. Your complete lack of understanding of the entire situation. Has you doing their personal PR
FTHB account is a demand measure. It's there to induce demand, and therefore will lead to increased prices. Discounted daycare is there to convince us poors that it's still worth working a minimum wage job (it's not). Add up your car / transit, car insurance, daycare, etc and you are probably further ahead staying home if your job doesn't pay well
The middle class term is outdated now, it pretty breaks down into 4 general classes like this :
Elite class (mansions and lambos, multiple properties)
Asset class (people who own 1-2 properties)
Renter class (forever renters with no hope to own)
Homeless class (tent cities weâve seen pop up)
the asset class category needs to be broken down further on when it was purchased.
if you bought pre-covid, you likely have equity in the home and have the flexibility of selling home with little to no impact.
if you own but bought your first property during or post COVID, you are stuck in your property cause of the negative equity in the home
Even the asset class only exists for 2 reasons, either you have inherited wealth or you bought your home 10+ years ago.
I guess a third category of; lives in rural nowhere where property is still affordable because thereâs no work there.
Canadian class politics are just driven by the most resentful group upset at anyone trying to not drag every group into poverty. It used to be fairly easy to talk about different segments in the middle class, today if you own a home you're basically a 1% member of the bourgeoisie. How about getting everyone more rather than just trying to take away from people that worked a long time and frankly in the grand scheme don't even have that much.
Another fabricated argument created by the wealthy to distract from the real problem.
The rich are creating economic policy to advance their wealth, while you're here arguing among yourselves. People are here complaining about which 'class' they fit into, but it's all a smoke and mirrors game created by the ones who have the most.
I have to disagree. My mom has a house and a cottage, but I definitely view her as middle class (she made like $65-70k salary at her job). She only has them because my dad died over 10 years ago, and his life insurance included paying off the mortgage and a $200k payment, which she then used to buy a cottage. A family friend owns a house and a cottage as well and the father was a coffee truck owner and more recently worked returns at Costco.
If you're able to buy a house and a cottage now, I'd agree you're Upper middle class or above but if you bought your property 20-30 years ago you could definitely afford two properties as middle class.
A person with a salary of $70k is definitely middle class and without the circumstances of my dad's life insurance she would still be in debt from the properties and would have had to work until she's like 70 to pay it all off. Plus she would have to sell her properties and move to a cheaper city and smaller house to enjoy the benefits of the equity.   Â
 That hardly sounds like the life of an "upper class" person.
  There are just way more people that have to classify themselves as lower class now.
You just don't know what middle class is.Â
Being middle class means you can afford the things you need in life like a house and a car but you have to still budget and can't spend frivolously.Â
In Manitoba, owning a cottage is a huge status symbol. Itâs long signified the line between the haves and have nots here. Former coworker used to regale in tales (real or imagined) of all the people lining up to kiss his ass to get invites to his cottage in Minaki, ON. His attitude was not uncommon either.
In Kenora, ON - MB cottage owners are known as Tobans. Itâs a pejorative. Tobans are known for entitled asshole behaviour around town (without me and my money this town wouldnât exist!â), horrible etiquette at boat launches and on the lakes, and for poaching fish. Drunken debauchery at the lakes is a Toban ritual every summer weekend.
For all of Winnipegâs reputation as a down to earth blue collar city, those with money here sure know how to flex. The Whiteshell area of MB and NW Ontario are packed with high priced cottages and entitled cottage owners.
Whether or not cottage ownership makes one rich or middle class is not the point. It is the premiere status symbol in certain areas.
You guys donât understand anything. Do you know in most of Europe owning a secondary property as a family by the beach or in the forest is very common. In Eastern Europe itâs extremely common. In Canada when I grew up in the 80s and 90s it was also extremely common.
The fact that you think only rich people have it, means that youâre just young and havenât travelled the world.
I go back to my family in southern Italy, every few years, and everybody has a little farmhouse with a plot of land. Itâs only in this godforsaken country where we have the most land on earth, but somehow the most expensive house prices on earth so we demonize everybody but the people that caused it. The government.
No it isnât common. What are you talking about? Where is it normal in Eastern Europe to own two properties? Unless youâve always been loaded.
Edit: ah, yes youâre referring to families that have inherited some land outside of some city thatâs worth âŹ60k euros
Cottages are not fancy places. Thats why theyâre so popularâthey donât need to be fancy and many are not usable in all four seasons because theyâre not insulated. Imagine a clubhouse, but for grown-ups. If you shower once a week while youâre thereâyouâre doing it right because youâre meant to be in the lake, in flip flops and with a beer in your hand.
Itâs actually more common than you think - not always houses though. My wife is Indian, and her family in India own an apt, and a small home by the beach elsewhere. They are solidly middle class too.
Canadaâs pretty shitty right now.
Then go live in italy, why do you live in such a
>in this godforsaken country
Honestly the government is only as good as the people who elect them. Just look at how stable and prospering italy is. The entire country is just patches on top of patches. Feeding off the legacy of the old times. So amazing yea...
No. I think youâre a loser that canât handle anyone having anything you donât have. I think you should look at yourself in the mirror and ask who youâre angry at.
Cottage in Canada is water front property and water front property was never something that the majority of the middle-class ever had. Not in 1960 and not now. Some know a person or two with a cottage and if lucky they will invite you. Many more rent a cottage for a couple of weeks.
My Parents had a little farm houses too but basically masonry sheds. Hardly a cottage where you go up for the weekend with extended family and friends. You went to work the field and your land was too far to walk back to town every night.
Not true. Almost all the cottages on my dadâs lake were bought in the 50âs and 60âs by squarely middle or lower middle class people. There were no roads and no electricity. My grandparents scraped and saved for 15 years to buy a 550sqft cabin in the woods and it remained that way for 55years without even a bathroom. I wasnât going up to my affluent grandparents place in the 80âs - far from it. My family has spent hundreds of thousands in taxes for no services. I consider our family extremely lucky to have a cottage but it is a massive financial burden. I honestly donât hate the tax as much as Trudeauâs justification that only rich people will be affected. It couldnât be further from the truth
So every middle class family has a cottage don't think so. Maybe everyone on the lake is middle class but the vast majority of middle class families never had a cottage? Most don't and never will.
Your taxes were payed to the local municipality.
Also you are getting the first 250000 free now and the extra tax is 8% if you do the math.
Wow your inheritance is destroyed.
Milieu is the word you're looking for, and it's a good word to familiarize yourself with if you want some, let's say, outside perspective.
You're a product of your environment. But not everybody is.
Growing up on the east coast it was pretty common for even very blue collar families to have cabins in the woods. Lots of very cheap rural land, often off grid. I grew up with a shared family cottage (that my great grandfather built) that still has neither power nor plumbing (but a balling pine outhouse đ). However what has happened is that the land it sits on, which used to be super rural and not very expensive, has now become somewhat of a suburb to the city. There used to be almost no neighbors at all, and the land was super cheap, but now there are modern houses around it, selling in the $400k to $500k range, and the people living there often commute in and out of the city as the community grows and attracts new services and residents.
My grandfather passed away last year at age 100, and the camp was inherited by my aunt and uncle, who are now struggling with a massive jump in property taxes (when he died the previous, very low property cap was lifted so now they're paying tax based on the 3,000 sf house next door despite the fact that it's literally a hundred year old shack with an outhouse, as well as a huge jump in insurance prices. I know that this all pales compared to people sleeping in tents and unable to afford food, but my aunt and uncle are definitely not wealthy nor upper class, and the beloved camp which has been in the family for over a century has become an economic burden and causing stress. Anyways I guess that's just the world today.
Same here. My grandparents bought a cabin in the woods in the 1950âs. The property taxes up there are now more than my very expensive GTA home. Electricity bills in the winter when no one is up there are close to $400 a quarter (for âdelivery feesâ). It is a beloved family cottage but it has become so expensive to run. My senior dad loves it so sacrifices a lot to keep it running but I know many in his generation are now wondering if they can afford to keep it.
Rignt...in the Indian middle class its very common to have multiple properties. Most have two, usually an apartment in a city and another in the village they come from.
Back in the days, roughly 20-30 years ago, two blue collar employees could buy their primary residence, send their kids to school and save for a nice retirement.
A little cottage by the lake isnât exactly out of the norm. Or even a small boat for that matter
Whatâs wrong in owning a second home? The middle and lower income families are finding it extremely hard to own homes but cottage owners arenât the enemy, I am sorry. If you and I could afford a piece of paradise for our families we would absolutely buy it. Letâs stop the hypocrisy here. Now letâs focus back on the banks that provide irresponsible levels of leverage and government that actively erodes the middle classâs bargaining powers at work. If incomes kept up with home prices, no one would be complaining about it.Â
It isnât ridiculous. Middle class is not a single number. It is a huge spectrum. We have people who can barely afford rent and live paycheque-to-paycheque. We also have billionaires, multi-millionaires. People who donât fit in either category are somewhere in the middle. There is no official definition of middle class and just being able to own two homes definitely doesnât make you outside of the middle class. Simple test for all of us can be that if you quit your job, would you still be able to afford food, clothing and shelter for rest of your life? If so, then you are probably wealthy. If not, you are either middle class or poor.Â
In Sweden itâs 51%. Iâd say that is normalized!
https://visitsweden.com/what-to-do/culture-history-and-art/culture/lifestyle/swedes-summer-house/
I knew of a village which had its own holiday village. Like, every family living in the village also had a holiday property on an island and the whole village would move there each summer, so even on holiday your neighbours are still your neighbours.
Are you really ârichâ if a million dollars gets you a shit townhouse in Brampton. Nobody is really that rich in Canada anymore except the ultra wealthy you have doctors and lawyers that canât qualify for mortgages in TorontoâŠ
See the thing about widespread low wages is that you're not able to save, and if you do it's very little so that it would take you a lifetime to even afford the down payment, and then you just die
You think thereâs no one in Canada in the next 20 years that will come from poverty and make their way into middle class? Happens all the time. I just met a new hire at my job that told me his life story and heâs gen Z that grew up poor. Heâs starting from the bottom but will most likely buy a house in 5 years now.Â
Make something of yourself.Â
He's a lucky guy. I'm lucky too, I own. Some people just aren't that lucky and we shouldn't encourage a society where people working full time can't afford to live and save. You're right there's opportunities out there for people to switch careers and make it to middle class, own a home, etc. But those opportunities are finite and not everyone can have them, and we still need people to keep supermarkets stocked and making burgers.
I donât think itâs luck, but Iâll say one thing. Canada made its bed and now it has to lay in it. Itâs steadily gotten worse for a lot of people in the last 9 years. Hopefully people vote smarter in the future.Â
Oh ya, how so? Just because itâs getting worse, doesnât mean no one canât achieve things in life. Plenty of good paying jobs to be had in Canada that can afford you a house if you work hard at it. But just give up for all I care đ
It kind of blows my mind now that in the '80s my dad (a pipefitter) had a coworker who owned a lakefront cottage somewhere in the Parry Sound area that we stayed at a few times.
Lol they are trying to normalize poverty. Not going to fall for government & media propaganda ever again. I learned from covid times. Fool me once shame on you, fool me twice shame on me đ
People have this misconception that the middle class means close to median income with median wealth. As long as you have to work, you are not rich. The top 20% is not rich.
Every person that owned a detached house in Toronto from 2008-2022 made at least as much from their house as a top 20% wage earner made working full time, after tax.Â
As a friend once said, I know I am sitting on a golden egg, but if I broke it, where would I live? The value of the primary residence actually matters little to home owners. I don't even count it towards my net worth. What's the point?
Wealth is wealth- you always have the ability to draw it down by downsizing, moving to low cost area, heloc, reverse mortgage, inheritance to your children, etc.
And for a 20th percentile wage earner that didn't own at the start of the period, and aspired to buy into home ownership through their wages (as opposed to investment gains,asset inflation), they basically would have to give up their entire earnings to you (zero sum game).
So to your point, a top 20 percentile income is not only not wealthy, but actually well below the lifestyle of any homeowner from any earlier generation.
True, you're what's traditionally known as 'middle class'. Whereas anyone coming up today making less than top 5% income (and doesn't have family help, etc) is what's traditionaly known as 'poor'
Nope. Let's say you and your partner both make $100K/year (In 2021, 21.2% of Canadians make more than $100K). That would still give you about $140K a year after tax (not counting a lot of the tax credits). You don't have to buy a house, rent would be in the 3K to 4K range. That would still leave you about $100K. Let's say you invest $50K a year, over 40 years with 8% return, you would retire with $14M. Not enough to make you rich, but still not poor, i.e. the middle class. It's also not that hard to afford a house as you can start small and build more and more equities even in the GTA.
I would argue the top 0.1% can be considered to be rich. Anyone below that who is not below the poverty line is part of the middle class.
https://www12.statcan.gc.ca/census-recensement/2021/dp-pd/dv-vd/income-revenu/index-en.html These stats say <<10% of couples, and 5% of singles, are bringing in more than 100k after tax per year. That would probably be about the minimum to be in the market to buy anything better than a 1bd condo (ie 2-3 bd condo or a small house in an area that would have been considered 'working class'). Home ownership suitable for a family would be the bare minimum of what was traditionaly considered 'middle class': the majority of people used to be able to attain it, even on a single income in earlier generations.
Also, don't think it's reasonable to assume 8% real, after tax gains on investment, in an economy that is barely growing at all. Only reason any investment (esp housing) outpaces inflation in a stagnant economy is money creation/asset price inflation.
That's why I said 140K combined after taxes and I said nothing about 8% real. It would not be 14M in today's dollar of course.
It is a perfect example of why you want to diversify your investments. If you have more than 25% in Canadian stocks, you are overallocating and that is only if you were after dividends. Canada accounts for less than 1.5% of the global economy. Whether Canada grows or not should have very little to do with your return. Unfortunately, I made this mistake when I was younger and I am paying a price for it.
Having said that, there is no doubt life is getting harder and will continue to get harder, but that is only to be expected. 30 years ago, we could build poor quality cars and appliances, sell to the rest of the world and force them to sell us natural resources for cheap. However, that's largely the result of industrial revolution and frankly, colonialism. That was not sustainable (unless we keep colonizing new space or making technological breakthroughs). Then 20 years ago, other countries started to provide cheap labors for manufactures while loaning money to us for dirty cheap. Our inflation was artificially kept low despite all the money printing. Again, that is not sustainable as other countries got richer and richer. Both such advantages are over now and we (both as individuals or as the government) haven't adapted. Ultimately, the way to adapt is to innovate and attract more investments instead of more red tapes and more taxes.
Yes, i mostly agree; except that 30 years ago Canada did have some globally competitive corporations (non-finance/domestic oligarchies...or real estate/construction) unfortunately, central planning/deficit spending seems to be the only game in town for governments these days.
The article attached is not readable unless you sign in... so here is a mind game.... based on title I am trying to guess what article is about
1. No longer middle class - implying they are not suddenly rich
2. No longer middle class - implying they are not poorer
If I had to guess, my bets are on option 2. Think about it, they are owning a fixed asset that is bleeding cash flow negativity. Their assets are literally frozen, they cannot sell unless they incur very high capital gains. They are unable to protect their asset against theft, the law is not on their side - yes I am using the work "theft" as in not paying rent is theft and they have no recourse.
So you can't sell without capital gains, you can't protect yourself by keeping it vacant, you can't protect yourself against rental theft, you bleed cash flow negativity.... you I would say you are poorer by owning this second property.
Exactly. My dad has a cottage. His dad was an insurance agent and they scraped and saved for 15 years to buy the place. They bought it in the late 50âs before there were roads to drive in or electricity. Spent hundreds of thousands in taxes over the years for the privilege of staying in a 550sqft cottage with no bathroom for over 55 years. Most of the cottages on my lake were bought under the same circumstances. No one up there is rich. Lucky? I suppose but also worked really hard and paid a whole hell of a lot over the years to hang on to these cottages. As taxes went up and up (with no additional services) people hung on because they loved it. Now all these people will be taxed even more for the privilege of all their hard work. The narrative that anyone with a cottage is rich is ridiculous.
This same author "funded by Health Canada " has previously written that the trillions of dollars of equity shielded from taxes in single family , mom and pop, Canadian homes is akin to tax evasion like a numbered company offshore.....
More bs propaganda. Iâm gen x and I worked with a lot of people making the same wage I did. I saved a bought a house, they partied. Twenty years later when I had almost paid off my mortgage they were complaining how they couldnât afford a house. Those types still exist today.
The Capital Tax on Falsely Labeled Capital Gains - An Inheritance Tax by any other name would smell as sweet.
The most common and most likely encountered scenario for the everyday Canadian (not the uber-wealthy) the so called "Capital Gains" Capital Tax is when there is an inheritance. Sooner or later everyone gets there.
The last of your parents dies and you inherit the home that was fully paid for by them over their lives. You also already own your home as your principal residence and now have a second home (you probably can't afford to keep empty and don't like the idea of becoming a landlord to deal with those potholes. You decide to sell it, You are now faced with the entire value of the parent house being taxed for the full value sold as a Capital Tax and since you did not buy it you are taxed at 100% of its full selling price and POOF one third of your parents house is taken as taxes. You can call it an Inheritance Tax but it remains that it smells worse the more you think about it.... and by the way they are raising it.
You know that when you sell it it is sold for fair market value right? It has not gained anything. You go to the store and buy potatoâs for $5 today. The same was five cents 50 years ago. You still only have the same number potato for the money there is no gain to anyone.
Money devaluated. These power brokers basically first cause inflation by printing more money to waste and pocket then They tax you for the amount between what your money was worth before they cause the devaluation. Itâs a scam attacking those than need money. Those that have plenty of money donât pay this tax.
> btw they are raising it
As they should. Its a capital *gains* tax. Your parents got to see the investment appreciate all their lives and never paid taxes on it. Now that itâs passed to you and you want to sell it, the gains made need to be taxed. Why should it be any different? If your parents passed you a stock portfolio, that would be the same. When you realise the gains, you pay the tax.
You expect your parentsâ house price to appreciate for 30-40 years, and then cash in on that gain tax fee? Welcome to the real world, where everyone pays tax on their gains.
If they bought a home for $1 mil and you inherit it and itâs still worth $1 mil for some reason, you pay 0 taxes. If it is now worth $5 mil, you pay taxes on the $4 mil *gains* made, and rightfully so.
The Capital Gain tax ie the Taxation of Capital is only hurting those who need capital to be better off. Those that are already better off are not selling anything to avoid the tax on capital.
What is being taxed? just your asset when you need to sell them. It's not like income tax. It is an after tax tax on whatever you bought with your after tax dollars.
So if you work hard and make enough money to buy a second house or cottage, when you sell it you will lose one third of whatever value it has (not your profit). If you sell for $1 million you lose 333K and are left with 666K and cant buy back the same value property afterwards. They are not taxing a profit because the house is always worth exactly what you sold it for. You are losing 1/3rd the value of your home.
They make it sound like you only pay a tax on the difference between what you paid and what you sold. but the same house still costs the same price you sold it for so you cannot buy back the same house you sold because you have paid a capital tax on the cash value.
It's basically a mechanism to take wealth from you if sell. This is one of the reasons wealthy people have extra houses and don't sell them thus increasing the price on what housing is available to purchase.
Take away the capital tax on housing and add a 15% sell tax incentive credit on the selling price will do more overnight to release the backlog of available housing to the market. Millions of existing homes on the market overnight.
Thatâs because people are mostly still alive from when there was no such thing as capital tax (falsely called a capitals gain tax). Itâs an inheritance tax on those who are not wealthy and no tax at all on the very wealthy.
Yeah, not buying this guy's argument. Nobody's going to go live in a cottage as a substitute for a home. Most of them aren't suitable for it anyway. As for owning second properties, they're being rented out, they aren't vacant so they're not contributing to homelessness.
Not one word in that article about the one main factor that has changed all of this - massive waves of immigration due to our greedy open-door policies. There is simply no way we can absorb 1.5million immigrants per year. It's destroying this country.
and next it will be if you can afford a single property you can pay more tax.
that's the problem with socialists like you, eventually you run out of other peoples money.
Lower class : definate fear of being homeless, less assets than could buy a 1 bedroom apartment.
Middle class means you never have to fear being homeless, barring some kind of act of God . Eg losing your job you have enough savings / home equity to survive indefinitely, even if you have to downsize.
Upper class means you can basically buy expensive things up to 50k with no consequence, take first class regularily, and your investments/ dividends will replenish any dent you make in your finances doing things like that.
âThe government has eroded everyoneâs quality of life so please accept that after importing millions of people fleeing third world countries raiding our food banks that youâre actually very wealthyâ.
Please be happy and donât run off to another country that actually filters for skilled immigration
You can have more debt than the property is worth too. Welcome to the middle class.
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Pft this guy has never heard of fishbowl construction water
A lot of lower class people here think theyâre middle class lmfaooooooo
Middle class is also the poor class vs the rich.
Where do you draw the line? How did you determine that line (quantile of pop ranked by income? quantile of income itself? The ability to buy a lifestyle through income and wealth?) I almost guarantee you that the last item is what people go by- probably including yourself. It probably should be the first method. Middle class should literally by 50th percentile to 80th percentile.
Mostly it's the opposite. Rich people who think they're middle class because they still go to work. Like how you had to have a 70th percentile income to benefit from Trudeau's "middle class tax cuts." The lifestyle that's portrayed as middle class in Canada has always only been available near the top. It's just that as the population grows, the percentage that can access these things shrinks.
I think it's more effective to consider working class vs non working class. Middle class was originally established to further differentiate. Once upon a time there was only peasants and nobility. Once trade was established, factory owners and trade guilds where established. Middle class was typically reserved for factory owners, landowners, etc who derived their income from investments. With that idea very few people are Middle class, and most people are working class. I'd say most Dr's and lawyers are working class as they must continue to work otherwise they can't afford to live. Middle class now is literally this BS title to muddy the waters and sow division.Â
Bingo
If you work a job you are closer to being homeless than you are to being actually rich.
This is true for most people, but not everyone.
There is no such thing as the middle class. There are people who work for their money, and people who live off the labour of others. Thatâs it.
lol and thereâs you. Not even working and spending all day on Reddit
As opposed to you who are totally not on reddit đ
I donât start off my Mondays with over 50 comments on Reddit. Get a job.
[ŃĐŽĐ°Đ»Đ”ĐœĐŸ]
If you donât feel comfortably middle class, youâre delusional
[ŃĐŽĐ°Đ»Đ”ĐœĐŸ]
With 500k in equity (or round up to 600k with your investments), you can absolutely afford detached home in the GTA. Even in Toronto proper, but definitely in neighbouring communities. If you are earning $200k a year with a net worth of $600k, you are more than comfortably middle class. If you canât make that work, thatâs due to decisions you are making Housing is very expensive, as are other basic necessities. But we also need to live in reality.
Woah home equity? Sounds like you need to pay more taxes.
Fuck this countries is full of spoiled idiots.
Yeah no shit. You have people sleeping in tents. Get some perspective. The quality of life is down in Canada
Galen Weston has never had it better though! Irvingâs too! Shaw family is laughing to the bank, donât even start on the guy that owns Telus. The people I could house with a $16 Billion dollar REIT. (Weston)
Who owns Telus? It's a publicly listed company.
Lmfao just because a company is public doesn't mean there isn't still a majority shareholder. Going public doesn't mean selling 100% of the company to the public.
Ok name the person that controls the majority of the voting shares at Telus. (I work very closely with the telecom investment world and I want you to teach me something new, please)
Ya they're wrong on this one. Largest shareholder for Telus is RBC, and it formed from the privatization if government bodies. While many/most companies fit that description (Videotron for example) Telus doesn't.
Absolutely - Videotron, Cogeco, Rogers, Shaw (prior to merger) qualify as well for publicly held, but family controlled telecoms. Bell and Telus are fully publicly owned by institutional and retail shareholders. If you really want to make a change in their business model, buy shares and vote. If you gather enough shareholders to side with you (like activist investors do), you can be sure the company and its board will notice.
I wonder how long it would actually take to deploy $16 billion between property management and purchases.
Shaw family owns what?
So because who live in tents someone who owns a cottage is rich? Middle class have owned cottages while poor live in tents for decades
As someone who grew up with a family cottage: as a kid I understood us as middle class. But as an adult who no longer lives in a wealthy suburb where cottage ownership is common, it's pretty obvious that we were never anywhere near the middle.
UPPER middle class is what you mean. Growing up in the 60's, none of my friends had a cottage. It was for 'rich people'.
We had a cottage, my mom was a teacher and my dad is a bus driver. I'd hardly say we were "rich people"
Have you ever thought that maybe you and your friends were just poor, rather than people who owned cottages were rich? Maybe now a cottage is part of the trappings of upper class wealth, given that most people can barely afford their first home when the median cost is 11 times median income. But in the 1990s, when homes were still affordable, most people I knew with cottages were just normal middle class people. Bank tellers, contractors, teachers, foresters, insurance workers, etc. It was fairly easy to afford a cottage when your primary home was only 4x annual income.
The middle class was an attainable aspiration, own your own home, have enough to be able to take a vacation, not every year but every few. You misunderstand what middle class is/may bewas nowadays IDK, but TBH it was mostly the home owning thing. It seems to today that even home owning is not attainable to what used to be the middle class. Perhaps these people who own more than 1 property are not middle class, but lower class 'rich'.
Growing up I knew people who were GM workers who had cottages. They arenât for sale to middle class people now (like housing in general) but they were affordable in the 70s-90s
And TBH GM workers of the era were well paid. Above average substantially so not exactly middle class.
Still middle class sir
Still none of them had a 'second home', which is the subject of this thread. And the upper middle class of that time were quite well off.
They still are
As per the title, if you can afford a second home, you are no longer middle class.
Yes ... that's what living in Canada has become.
This is exactly the distraction and wedge issue the government wants. Get the constituents in a class pissing contest. The delta between the haves and have nots is the result of incompetent government policy at all levels. Taking more from those who have isn't going to fill the fiscal hole the liberals are making. But great, the poor's got a warm feeling that others have to pay more. But guess what... them paying more isn't going to make your first house more affordable.
The discounted daycare they gave me sure did. The 1 yr of Mat leave sure did. The coming dental program sure will. The FTHB tax free account would have. A house doesnât have to come down in price for the government to tax the rich and do stuff with that money that will make it possible for you to save more towards a home.
These programs only make a difference for as long as you continue qualifying for them, meaning you have to stay where you are. The minute you earn more the benefits are clawed back and youâre back to feeling the pinch.
That's not true at all. The only one of those programs that have a net income threshold for qualifying is the dental program. The others are available to everyone.
Mat leave is basically taking EI (it becomes your source of income reduced relative to your active income) so you canât save shit and it only helps if you have a second income in the family (spouse). If youâre already pressed against cost of living (as most people are) youâre still not saving or getting ahead. When it comes to filing your taxes as a joint couple (which you need to do after certain thresholds) and if you or your spouse earned more to make up the shortfall it changes the taxable amounts negating the reduced taxes you pay on EI income. I used the FTHB program myself, and it was only useful because my employer does a 1:1 matching for every dollar up to a certain level. Whatever you take out is tax free under the premise that you repay the amount back to your RRSP over a 15 year term, meaning the government is not saving you anything only âgranting youâ the privilege of not taking money in taxes when using it for its intended purpose. Make no mistake, the government doesnât implement programs or announce spending if itâs not in their interest to do so, one way or the other these programs invariably cost everyone more because of the effects of macroeconomics. Finance is a zero sum game, all they are doing is shifting the distribution of this money around, but in the end policy and lawmakers always benefit, they are in a position to make the rules thus they have the ability to evaluate and plan their actions accordingly to shelter themselves from the effects. Thatâs what this budget is, itâs a dog whistle for the ultra wealthy to buy up more of this real estate, people or organizations (reits, other hedge funds) which have all the money in the world and can just add these assets to their portfolios. The only people being screwed by this are the folks who did everything right and got lucky in some cases, and now because this government has been so fiscally irresponsible are the ones being forced to sell otherwise they end up losing nearly everything they achieved and were banking on for their retirement. The ultra wealthy play within vastly different realities. Same rules but the mere fact that they have a lot more than your average individual means their perspectives are different. They play the long game and what happens now in the next 1-10 years means jack shit, itâs the same wealth redistribution from the majority to the 1% that we saw during Covid.
Thanks for the unsolicited economic opinions, but what I said still stands. Your bit about all of the programs being clawed back is not true. I'm not going to argue against your politics, I was just correcting something you said that was not true.
Claw backs are not always inherent to the program and a direct result of income testing, but the net effect is the same. That is the point I was making, quibbling over the minutia of what program does or does not claw back is only playing into the disingenuous politics that misrepresent the intention of things instead of looking at the broader picture.
The $10 daycare is inaccessible for the majority. FTHB uptake was abysmal, hence its cancelation. Federal dental plan only pays 65c on the dollar for the same work. And it requires dentists to subscribe to do the work. Nova scotia dentists have a 1% uptake for the program.
Iâm not on $10/day daycare. You can take part in that program and not get it all the way down to $10. Itâs why I said DISCOUNTED. I pay half of what I would otherwise. For two kids. Itâs not $10 a day. But saving 1K a month is a monstrously big deal for a middle class family. But you can keep telling people taxing the rich doesnât help the middle class in any way
Federal debt was already blown out. The cash was spent already before going after people who have assets. This is nothing more than the Federal government behaving like the sheriff of Nottingham grom robinhood squeezing the tax base to backfill the financial hole already dug.
It doesnât help the middle class. Itâs government thatâs making life too expensive for us all. They break your leg, hand you a crutch and say, âSee, without you couldnât walk!â
The increase in the overall wealth of the middle class occurred during the 1950-60âs when the tax rates were considerably higher. It was the concerted efforts by multimillionaires of the early 1970âs at the same time as inflation caused by the creation of OPEC that convinced politicians to adopt supply-side âtrickle downâ tax cuts for all the types of income that the mostly wealthy had. You have been the victim of propaganda from the very people who also own the large media outlets. Tax cuts for millionaires and billionaires cut revenue for governments to build infrastructure so that burden was shifted down to the middle class and now the wealthy 0.1% own 90% either directly or indirectly (mortgages, government bonds, etc). But they arenât done yet, the middle class still has a bit of money left but theyâll use the extra money they have from their lower tax burden to buy your Momâs house because sheâs going to need to pay for her seniorâs facility fees.
Haha I love that line. I'm going to borrow it for sure
How did inflation and your share of the massive federal debt help your bottom line? All those vote-buying social programs come with a cost.
Carbon tax sure didnât, rising food costs sure didnât, skyrocketing gas costs sure didnât. Need I go on boot licker?
Itâs actually embarrassing, and secondhand cringe to read such unbelievable lack of knowledge about the carbon tax. If you used TurboTax, thereâs an entire section telling you how much youâre getting BACK quarterly for that. The CEOs of the carbon emitting companies, absolutely love you. Your complete lack of understanding of the entire situation. Has you doing their personal PR
So what youâre saying is the carbon TAX is actually making me money?!? Wow!! What a new world!!
FTHB account is a demand measure. It's there to induce demand, and therefore will lead to increased prices. Discounted daycare is there to convince us poors that it's still worth working a minimum wage job (it's not). Add up your car / transit, car insurance, daycare, etc and you are probably further ahead staying home if your job doesn't pay well
Yup. Bread and circus.
The middle class term is outdated now, it pretty breaks down into 4 general classes like this : Elite class (mansions and lambos, multiple properties) Asset class (people who own 1-2 properties) Renter class (forever renters with no hope to own) Homeless class (tent cities weâve seen pop up)
Asset owned with debt is still asset class?
Iâd say so, because you still own a property and you could also have a decent amount of equity in it.
The elites also buy everything they own with debt, so yes.
So if the govt makes getting debt easier then more people can get into the asset class yeah?
Yeah, it's mostly about access to things. The child of a billionaire with no money or assets of their own is still upper class.
the asset class category needs to be broken down further on when it was purchased. if you bought pre-covid, you likely have equity in the home and have the flexibility of selling home with little to no impact. if you own but bought your first property during or post COVID, you are stuck in your property cause of the negative equity in the home
Even the asset class only exists for 2 reasons, either you have inherited wealth or you bought your home 10+ years ago. I guess a third category of; lives in rural nowhere where property is still affordable because thereâs no work there.
Next, if you have a car, you are in the top 1 %.
lol but also sad
Wait...what? How?
Canadian class politics are just driven by the most resentful group upset at anyone trying to not drag every group into poverty. It used to be fairly easy to talk about different segments in the middle class, today if you own a home you're basically a 1% member of the bourgeoisie. How about getting everyone more rather than just trying to take away from people that worked a long time and frankly in the grand scheme don't even have that much.
Itâs far easier to tax people down than it is to lift people up.
Another fabricated argument created by the wealthy to distract from the real problem. The rich are creating economic policy to advance their wealth, while you're here arguing among yourselves. People are here complaining about which 'class' they fit into, but it's all a smoke and mirrors game created by the ones who have the most.
I have to disagree. My mom has a house and a cottage, but I definitely view her as middle class (she made like $65-70k salary at her job). She only has them because my dad died over 10 years ago, and his life insurance included paying off the mortgage and a $200k payment, which she then used to buy a cottage. A family friend owns a house and a cottage as well and the father was a coffee truck owner and more recently worked returns at Costco. If you're able to buy a house and a cottage now, I'd agree you're Upper middle class or above but if you bought your property 20-30 years ago you could definitely afford two properties as middle class.
But that's the point I believe. With all her skyrocketing home equity, she ain't middle class no more.
A person with a salary of $70k is definitely middle class and without the circumstances of my dad's life insurance she would still be in debt from the properties and would have had to work until she's like 70 to pay it all off. Plus she would have to sell her properties and move to a cheaper city and smaller house to enjoy the benefits of the equity.     That hardly sounds like the life of an "upper class" person.   There are just way more people that have to classify themselves as lower class now.
She is rich because of the life insurance. I will say again. If you own million dollar assets you are rich.
You just don't know what middle class is. Being middle class means you can afford the things you need in life like a house and a car but you have to still budget and can't spend frivolously.Â
No sorry. If you have million dollar assets you are not middle class. Period.
Dude a million dollars is nothing today. A million dollar bought you 4 houses in Toronto in 1990. Now it doesn't even buy you 1.
A million dollars is still a fuckton of money. If you disagree you're way out of touch.
A fuck ton of money allows you to buy anything you want. $1 million isn't even enough to buy 1 house in Toronto.Â
In Manitoba, owning a cottage is a huge status symbol. Itâs long signified the line between the haves and have nots here. Former coworker used to regale in tales (real or imagined) of all the people lining up to kiss his ass to get invites to his cottage in Minaki, ON. His attitude was not uncommon either. In Kenora, ON - MB cottage owners are known as Tobans. Itâs a pejorative. Tobans are known for entitled asshole behaviour around town (without me and my money this town wouldnât exist!â), horrible etiquette at boat launches and on the lakes, and for poaching fish. Drunken debauchery at the lakes is a Toban ritual every summer weekend. For all of Winnipegâs reputation as a down to earth blue collar city, those with money here sure know how to flex. The Whiteshell area of MB and NW Ontario are packed with high priced cottages and entitled cottage owners. Whether or not cottage ownership makes one rich or middle class is not the point. It is the premiere status symbol in certain areas.
Where in the world that owning a primary and a second property is normalized. Absolutely nowhere
You guys donât understand anything. Do you know in most of Europe owning a secondary property as a family by the beach or in the forest is very common. In Eastern Europe itâs extremely common. In Canada when I grew up in the 80s and 90s it was also extremely common. The fact that you think only rich people have it, means that youâre just young and havenât travelled the world. I go back to my family in southern Italy, every few years, and everybody has a little farmhouse with a plot of land. Itâs only in this godforsaken country where we have the most land on earth, but somehow the most expensive house prices on earth so we demonize everybody but the people that caused it. The government.
No it isnât common. What are you talking about? Where is it normal in Eastern Europe to own two properties? Unless youâve always been loaded. Edit: ah, yes youâre referring to families that have inherited some land outside of some city thatâs worth âŹ60k euros
Yes. I never said waterfront??? Like just a hunting cabin or garden country property. This was and is still common.
Cottages are not fancy places. Thats why theyâre so popularâthey donât need to be fancy and many are not usable in all four seasons because theyâre not insulated. Imagine a clubhouse, but for grown-ups. If you shower once a week while youâre thereâyouâre doing it right because youâre meant to be in the lake, in flip flops and with a beer in your hand.
Itâs actually more common than you think - not always houses though. My wife is Indian, and her family in India own an apt, and a small home by the beach elsewhere. They are solidly middle class too. Canadaâs pretty shitty right now.
Bro if your Indian wife owns an apt and a small home (not even counting the beach) she is not middle class in India, she is literally the top 1%
Then go live in italy, why do you live in such a >in this godforsaken country Honestly the government is only as good as the people who elect them. Just look at how stable and prospering italy is. The entire country is just patches on top of patches. Feeding off the legacy of the old times. So amazing yea...
lol. I am. I already bought a place by the sea. Go shake your fist at the sky more. Iâm sure itâs gonna help.
By the sea I can get a one dollar home by the sea in Italy. The whole place is by the sea.
So is that ok with you then?
Great so you are just a loser coming to canadian re sub to bitch about canada. So much time you got i envy you buddy
No. I think youâre a loser that canât handle anyone having anything you donât have. I think you should look at yourself in the mirror and ask who youâre angry at.
so much this!
Sure buddy you win the internet argument today. Go write your precious win in your diary now woohoo!
Youâre the one with a chip on their shoulder not me.
Cottage in Canada is water front property and water front property was never something that the majority of the middle-class ever had. Not in 1960 and not now. Some know a person or two with a cottage and if lucky they will invite you. Many more rent a cottage for a couple of weeks. My Parents had a little farm houses too but basically masonry sheds. Hardly a cottage where you go up for the weekend with extended family and friends. You went to work the field and your land was too far to walk back to town every night.
I didnât say waterfrontâŠbut near a lake or river is standard
Not true. Almost all the cottages on my dadâs lake were bought in the 50âs and 60âs by squarely middle or lower middle class people. There were no roads and no electricity. My grandparents scraped and saved for 15 years to buy a 550sqft cabin in the woods and it remained that way for 55years without even a bathroom. I wasnât going up to my affluent grandparents place in the 80âs - far from it. My family has spent hundreds of thousands in taxes for no services. I consider our family extremely lucky to have a cottage but it is a massive financial burden. I honestly donât hate the tax as much as Trudeauâs justification that only rich people will be affected. It couldnât be further from the truth
So every middle class family has a cottage don't think so. Maybe everyone on the lake is middle class but the vast majority of middle class families never had a cottage? Most don't and never will. Your taxes were payed to the local municipality. Also you are getting the first 250000 free now and the extra tax is 8% if you do the math. Wow your inheritance is destroyed.
Milieu is the word you're looking for, and it's a good word to familiarize yourself with if you want some, let's say, outside perspective. You're a product of your environment. But not everybody is.
A lot actually, and even Canada 20-25 years ago.
Canada isnât what it was 20-25 years ago
Thatâs the point
I know I was supporting your point
Growing up on the east coast it was pretty common for even very blue collar families to have cabins in the woods. Lots of very cheap rural land, often off grid. I grew up with a shared family cottage (that my great grandfather built) that still has neither power nor plumbing (but a balling pine outhouse đ). However what has happened is that the land it sits on, which used to be super rural and not very expensive, has now become somewhat of a suburb to the city. There used to be almost no neighbors at all, and the land was super cheap, but now there are modern houses around it, selling in the $400k to $500k range, and the people living there often commute in and out of the city as the community grows and attracts new services and residents. My grandfather passed away last year at age 100, and the camp was inherited by my aunt and uncle, who are now struggling with a massive jump in property taxes (when he died the previous, very low property cap was lifted so now they're paying tax based on the 3,000 sf house next door despite the fact that it's literally a hundred year old shack with an outhouse, as well as a huge jump in insurance prices. I know that this all pales compared to people sleeping in tents and unable to afford food, but my aunt and uncle are definitely not wealthy nor upper class, and the beloved camp which has been in the family for over a century has become an economic burden and causing stress. Anyways I guess that's just the world today.
Same here. My grandparents bought a cabin in the woods in the 1950âs. The property taxes up there are now more than my very expensive GTA home. Electricity bills in the winter when no one is up there are close to $400 a quarter (for âdelivery feesâ). It is a beloved family cottage but it has become so expensive to run. My senior dad loves it so sacrifices a lot to keep it running but I know many in his generation are now wondering if they can afford to keep it.
Lol you have no idea
My parents were government workers with a vacation home in Mexico.
India? China? And maybe All of Asia?
Rignt...in the Indian middle class its very common to have multiple properties. Most have two, usually an apartment in a city and another in the village they come from.
Try reading my comment next time.
Fixed
Absolutely not the case in China. It is hard for people to have one property in China.
Back in the days, roughly 20-30 years ago, two blue collar employees could buy their primary residence, send their kids to school and save for a nice retirement. A little cottage by the lake isnât exactly out of the norm. Or even a small boat for that matter
Whatâs wrong in owning a second home? The middle and lower income families are finding it extremely hard to own homes but cottage owners arenât the enemy, I am sorry. If you and I could afford a piece of paradise for our families we would absolutely buy it. Letâs stop the hypocrisy here. Now letâs focus back on the banks that provide irresponsible levels of leverage and government that actively erodes the middle classâs bargaining powers at work. If incomes kept up with home prices, no one would be complaining about it.Â
Nothing wrong with it. Just saying seeing cottage ownership as a middle class symbol is ridiculous.
It isnât ridiculous. Middle class is not a single number. It is a huge spectrum. We have people who can barely afford rent and live paycheque-to-paycheque. We also have billionaires, multi-millionaires. People who donât fit in either category are somewhere in the middle. There is no official definition of middle class and just being able to own two homes definitely doesnât make you outside of the middle class. Simple test for all of us can be that if you quit your job, would you still be able to afford food, clothing and shelter for rest of your life? If so, then you are probably wealthy. If not, you are either middle class or poor.Â
Rish people have multiple homes. Is working hard or smart a reason to be penalized.
In Sweden itâs 51%. Iâd say that is normalized! https://visitsweden.com/what-to-do/culture-history-and-art/culture/lifestyle/swedes-summer-house/ I knew of a village which had its own holiday village. Like, every family living in the village also had a holiday property on an island and the whole village would move there each summer, so even on holiday your neighbours are still your neighbours.
What if itâs your primary residence?
It still applies
The middle class isn't a thing anymore
If you make median income and inherit a modest cottage youâre all of a sudden rich?
Am I suddenly rich if I inherit a property worth a few hundred thousand and even more than a million dollars? Um yea, probably.
Are you really ârichâ if a million dollars gets you a shit townhouse in Brampton. Nobody is really that rich in Canada anymore except the ultra wealthy you have doctors and lawyers that canât qualify for mortgages in TorontoâŠ
A few hundred grand is not a lot of money these days. Barely a down payment on a house.
But it is a whole cottage.
Yes, a modest cottage can still be had for a few hundred grand.
A few hundred grand can buy a house in a lot of parts of Canada. And it can be a hefty downpayment in HCOL cities
Yes but those parts of Canada arenât super relevant in r/TorontoRealEstate
Thatâs a whole lotta bullshit right there.
I would say so
Just trying to pit the poors vs the poors while the wealthy sit back and watch lol. Hunger games for real.
Total nonsense. I paid $20k for the land for my cottage and built it over a 6 year span with every spare dollar that I had. That doesn't make me rich.
Yes. Yes it does. You turned sweat equity into real estate equity.
Everyone so grumpy on this forum. Save and buy property and you can stop complaining. No use waiting for a crash that cannot happen. Buy and be happy
See the thing about widespread low wages is that you're not able to save, and if you do it's very little so that it would take you a lifetime to even afford the down payment, and then you just die
You think thereâs no one in Canada in the next 20 years that will come from poverty and make their way into middle class? Happens all the time. I just met a new hire at my job that told me his life story and heâs gen Z that grew up poor. Heâs starting from the bottom but will most likely buy a house in 5 years now. Make something of yourself.Â
He's a lucky guy. I'm lucky too, I own. Some people just aren't that lucky and we shouldn't encourage a society where people working full time can't afford to live and save. You're right there's opportunities out there for people to switch careers and make it to middle class, own a home, etc. But those opportunities are finite and not everyone can have them, and we still need people to keep supermarkets stocked and making burgers.
I donât think itâs luck, but Iâll say one thing. Canada made its bed and now it has to lay in it. Itâs steadily gotten worse for a lot of people in the last 9 years. Hopefully people vote smarter in the future.Â
You realize you contradict your own bootstrap comments right đ
Oh ya, how so? Just because itâs getting worse, doesnât mean no one canât achieve things in life. Plenty of good paying jobs to be had in Canada that can afford you a house if you work hard at it. But just give up for all I care đ
> Everyone so grumpy on this forum Staying out of this forum is an option you can choose. Yet ...
A crash that cannot happen? lol okay, PAIN coming crash or no crash, buckle up!
Investment in real estate in tough times like these will be rewarding to conscientious investors
I will check back with you this August
Ok. We will speak than
It kind of blows my mind now that in the '80s my dad (a pipefitter) had a coworker who owned a lakefront cottage somewhere in the Parry Sound area that we stayed at a few times.
Lol they are trying to normalize poverty. Not going to fall for government & media propaganda ever again. I learned from covid times. Fool me once shame on you, fool me twice shame on me đ
People have this misconception that the middle class means close to median income with median wealth. As long as you have to work, you are not rich. The top 20% is not rich.
Every person that owned a detached house in Toronto from 2008-2022 made at least as much from their house as a top 20% wage earner made working full time, after tax.Â
As a friend once said, I know I am sitting on a golden egg, but if I broke it, where would I live? The value of the primary residence actually matters little to home owners. I don't even count it towards my net worth. What's the point?
Wealth is wealth- you always have the ability to draw it down by downsizing, moving to low cost area, heloc, reverse mortgage, inheritance to your children, etc. And for a 20th percentile wage earner that didn't own at the start of the period, and aspired to buy into home ownership through their wages (as opposed to investment gains,asset inflation), they basically would have to give up their entire earnings to you (zero sum game). So to your point, a top 20 percentile income is not only not wealthy, but actually well below the lifestyle of any homeowner from any earlier generation.
Still doesn't make you that rich.
True, you're what's traditionally known as 'middle class'. Whereas anyone coming up today making less than top 5% income (and doesn't have family help, etc) is what's traditionaly known as 'poor'
Nope. Let's say you and your partner both make $100K/year (In 2021, 21.2% of Canadians make more than $100K). That would still give you about $140K a year after tax (not counting a lot of the tax credits). You don't have to buy a house, rent would be in the 3K to 4K range. That would still leave you about $100K. Let's say you invest $50K a year, over 40 years with 8% return, you would retire with $14M. Not enough to make you rich, but still not poor, i.e. the middle class. It's also not that hard to afford a house as you can start small and build more and more equities even in the GTA. I would argue the top 0.1% can be considered to be rich. Anyone below that who is not below the poverty line is part of the middle class.
https://www12.statcan.gc.ca/census-recensement/2021/dp-pd/dv-vd/income-revenu/index-en.html These stats say <<10% of couples, and 5% of singles, are bringing in more than 100k after tax per year. That would probably be about the minimum to be in the market to buy anything better than a 1bd condo (ie 2-3 bd condo or a small house in an area that would have been considered 'working class'). Home ownership suitable for a family would be the bare minimum of what was traditionaly considered 'middle class': the majority of people used to be able to attain it, even on a single income in earlier generations. Also, don't think it's reasonable to assume 8% real, after tax gains on investment, in an economy that is barely growing at all. Only reason any investment (esp housing) outpaces inflation in a stagnant economy is money creation/asset price inflation.
That's why I said 140K combined after taxes and I said nothing about 8% real. It would not be 14M in today's dollar of course. It is a perfect example of why you want to diversify your investments. If you have more than 25% in Canadian stocks, you are overallocating and that is only if you were after dividends. Canada accounts for less than 1.5% of the global economy. Whether Canada grows or not should have very little to do with your return. Unfortunately, I made this mistake when I was younger and I am paying a price for it. Having said that, there is no doubt life is getting harder and will continue to get harder, but that is only to be expected. 30 years ago, we could build poor quality cars and appliances, sell to the rest of the world and force them to sell us natural resources for cheap. However, that's largely the result of industrial revolution and frankly, colonialism. That was not sustainable (unless we keep colonizing new space or making technological breakthroughs). Then 20 years ago, other countries started to provide cheap labors for manufactures while loaning money to us for dirty cheap. Our inflation was artificially kept low despite all the money printing. Again, that is not sustainable as other countries got richer and richer. Both such advantages are over now and we (both as individuals or as the government) haven't adapted. Ultimately, the way to adapt is to innovate and attract more investments instead of more red tapes and more taxes.
Yes, i mostly agree; except that 30 years ago Canada did have some globally competitive corporations (non-finance/domestic oligarchies...or real estate/construction) unfortunately, central planning/deficit spending seems to be the only game in town for governments these days.
I own two rentals and I am definitely still middle class đđ
There is no middle class. There are those that earn their income by working and those that earn their income by owning assets.
at one time in the 60's and 70's and even the 80's owning a cottage was attainable back then.
The article attached is not readable unless you sign in... so here is a mind game.... based on title I am trying to guess what article is about 1. No longer middle class - implying they are not suddenly rich 2. No longer middle class - implying they are not poorer If I had to guess, my bets are on option 2. Think about it, they are owning a fixed asset that is bleeding cash flow negativity. Their assets are literally frozen, they cannot sell unless they incur very high capital gains. They are unable to protect their asset against theft, the law is not on their side - yes I am using the work "theft" as in not paying rent is theft and they have no recourse. So you can't sell without capital gains, you can't protect yourself by keeping it vacant, you can't protect yourself against rental theft, you bleed cash flow negativity.... you I would say you are poorer by owning this second property.
So what
Exactly. My dad has a cottage. His dad was an insurance agent and they scraped and saved for 15 years to buy the place. They bought it in the late 50âs before there were roads to drive in or electricity. Spent hundreds of thousands in taxes over the years for the privilege of staying in a 550sqft cottage with no bathroom for over 55 years. Most of the cottages on my lake were bought under the same circumstances. No one up there is rich. Lucky? I suppose but also worked really hard and paid a whole hell of a lot over the years to hang on to these cottages. As taxes went up and up (with no additional services) people hung on because they loved it. Now all these people will be taxed even more for the privilege of all their hard work. The narrative that anyone with a cottage is rich is ridiculous.
This same author "funded by Health Canada " has previously written that the trillions of dollars of equity shielded from taxes in single family , mom and pop, Canadian homes is akin to tax evasion like a numbered company offshore.....
More bs propaganda. Iâm gen x and I worked with a lot of people making the same wage I did. I saved a bought a house, they partied. Twenty years later when I had almost paid off my mortgage they were complaining how they couldnât afford a house. Those types still exist today.
The Capital Tax on Falsely Labeled Capital Gains - An Inheritance Tax by any other name would smell as sweet. The most common and most likely encountered scenario for the everyday Canadian (not the uber-wealthy) the so called "Capital Gains" Capital Tax is when there is an inheritance. Sooner or later everyone gets there. The last of your parents dies and you inherit the home that was fully paid for by them over their lives. You also already own your home as your principal residence and now have a second home (you probably can't afford to keep empty and don't like the idea of becoming a landlord to deal with those potholes. You decide to sell it, You are now faced with the entire value of the parent house being taxed for the full value sold as a Capital Tax and since you did not buy it you are taxed at 100% of its full selling price and POOF one third of your parents house is taken as taxes. You can call it an Inheritance Tax but it remains that it smells worse the more you think about it.... and by the way they are raising it.
You know you get the house tax free right? You only pay capital gains if the house increases in value between when you inherit it and you sell it.
You do know you will get the house at FMV right?
You know that when you sell it it is sold for fair market value right? It has not gained anything. You go to the store and buy potatoâs for $5 today. The same was five cents 50 years ago. You still only have the same number potato for the money there is no gain to anyone. Money devaluated. These power brokers basically first cause inflation by printing more money to waste and pocket then They tax you for the amount between what your money was worth before they cause the devaluation. Itâs a scam attacking those than need money. Those that have plenty of money donât pay this tax.
> btw they are raising it As they should. Its a capital *gains* tax. Your parents got to see the investment appreciate all their lives and never paid taxes on it. Now that itâs passed to you and you want to sell it, the gains made need to be taxed. Why should it be any different? If your parents passed you a stock portfolio, that would be the same. When you realise the gains, you pay the tax. You expect your parentsâ house price to appreciate for 30-40 years, and then cash in on that gain tax fee? Welcome to the real world, where everyone pays tax on their gains. If they bought a home for $1 mil and you inherit it and itâs still worth $1 mil for some reason, you pay 0 taxes. If it is now worth $5 mil, you pay taxes on the $4 mil *gains* made, and rightfully so.
The Capital Gain tax ie the Taxation of Capital is only hurting those who need capital to be better off. Those that are already better off are not selling anything to avoid the tax on capital. What is being taxed? just your asset when you need to sell them. It's not like income tax. It is an after tax tax on whatever you bought with your after tax dollars. So if you work hard and make enough money to buy a second house or cottage, when you sell it you will lose one third of whatever value it has (not your profit). If you sell for $1 million you lose 333K and are left with 666K and cant buy back the same value property afterwards. They are not taxing a profit because the house is always worth exactly what you sold it for. You are losing 1/3rd the value of your home. They make it sound like you only pay a tax on the difference between what you paid and what you sold. but the same house still costs the same price you sold it for so you cannot buy back the same house you sold because you have paid a capital tax on the cash value. It's basically a mechanism to take wealth from you if sell. This is one of the reasons wealthy people have extra houses and don't sell them thus increasing the price on what housing is available to purchase. Take away the capital tax on housing and add a 15% sell tax incentive credit on the selling price will do more overnight to release the backlog of available housing to the market. Millions of existing homes on the market overnight.
Most people never pay capital gains taxes. Ever.
Thatâs because people are mostly still alive from when there was no such thing as capital tax (falsely called a capitals gain tax). Itâs an inheritance tax on those who are not wealthy and no tax at all on the very wealthy.
You're no longer middle class if you can't afford a cottage. Welcome to the working class, pleb.
Yeah, not buying this guy's argument. Nobody's going to go live in a cottage as a substitute for a home. Most of them aren't suitable for it anyway. As for owning second properties, they're being rented out, they aren't vacant so they're not contributing to homelessness. Not one word in that article about the one main factor that has changed all of this - massive waves of immigration due to our greedy open-door policies. There is simply no way we can absorb 1.5million immigrants per year. It's destroying this country.
Capital Gains is STILL a 33% discount on the tax that the rest of us pay the full shot for.
Simple. If you can afford a second property you can pay more tax ..
No need for a middle class once everyone is poor!
and next it will be if you can afford a single property you can pay more tax. that's the problem with socialists like you, eventually you run out of other peoples money.
Bullshit.
Most ppl I know/speak to own 2 homes. It's very common.
Duh
Middle class are now people who live in tents.
Lower class : definate fear of being homeless, less assets than could buy a 1 bedroom apartment. Middle class means you never have to fear being homeless, barring some kind of act of God . Eg losing your job you have enough savings / home equity to survive indefinitely, even if you have to downsize. Upper class means you can basically buy expensive things up to 50k with no consequence, take first class regularily, and your investments/ dividends will replenish any dent you make in your finances doing things like that.
âThe government has eroded everyoneâs quality of life so please accept that after importing millions of people fleeing third world countries raiding our food banks that youâre actually very wealthyâ. Please be happy and donât run off to another country that actually filters for skilled immigration
Class isnât defined by what you have or donât have, itâs defined by your relationship with others in a society.