Caledon House

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Caledon House

Postby matt » Thu Feb 19, 2015 4:36 pm

Drove by the house on De Rosa, Bolton.

The house

- looks solid
- in a quiet and nice neighbourhood (on a crescent)
- was probably built in the early 80's
- is currently occupied
- would easily go for half a million dollars.

So now the real waiting game begins..
Will it be redeemed? :D
matt
 
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Re: Caledon House-Postponed!

Postby matt » Wed Feb 25, 2015 8:36 pm

Rich,

One thing to mention is that it has been only postponed, not yet redeemed.
That means to me that it still has a potential to resurface in the near future.
We only see the tip of an iceberg - what lies underneath is much more interesting.
If you do the legals, you will understand why I say this. :D

Matt
matt
 
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Re: Caledon House- For Sale Again

Postby matt » Tue Apr 28, 2015 8:08 pm

You never know what is going to happen to a postponed tax sale.
I kind of sensed this one would resurface, and I was right.
Here we have it again...

This one will likely be sold, so well prepare yourself to cast to catch a big one.
House looks sold, and you might be able to flip it right away after minimal touch ups.

Good luck! :D
matt
 
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Re: Caledon House

Postby matt » Mon May 11, 2015 6:34 pm

Hi, RIch:

As per your request,
What do we do with the property we buy?
Look at the following 3 different ways..

1. Flip (Buy and Sell)
2. Keep for a while but sooner or later sell for profit
3. Make it as the primary residence

Option 1. Flip
This is something you want to do if you want to run a business with the tax sale bought properties. Because flipping is an income generating business, you must report any and all profit you make on a house as your Business Income and must pay your income taxes accordingly. Pro: You buy and sell quick, so the cash flow is very fast. You can reinvest the net profit (after-tax) for more profit. Con: You have to pay high level taxes.

Option 2. Keep it for a while but then sell it to public.
This is kind of doing a business also. But the difference is that here you report the profit you made as Capital Gain rather than Business Income. In this case, you only report 50% of the gross profit as your business income. Pro: You report only half of the gross profit as your income Con: You need to hold it for a year or longer so that Canada Revenue Agency might consider it as a Capital Gain rather than a Business Income. Note that CRA may still not agree with you even if you held it for longer than a year if it is deemed that your initial intention or objective was to do business with it.

Option 3. Make it your home.
This option requires you that you live there and that you claim the house is your primary residence. In this case, you are not to pay any tax on the profit when you sell the house. Pro: No taxes to pay Con: When you already have a primary residence, this option is not applicable

Hope this draws a picture...
matt
 
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