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Millennial electrician earning $80000 invests in bitcoin and real estate

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  • Name: Stephen Hajnal
  • Age: 30
  • Annual income: $79,500
  • Savings: $8,500 in TFSA; $4,000 in RRSP; $4,000 in cryptocurrencies
  • Debt: $142,000 mortgage
  • What he does: electrician
  • Where he lives: Ajax, Ont.
  • Top financial concern: “We definitely want to buy an income property by next year. I’d prefer to do Oshawa but we’re considering Hamilton.”

Stephen Hajnal has been an electrician for 10 years. It’s a career that offers him both work-life balance and a good paycheque; he works four nine-hour days a week and earns $79,500. If in the future he needs to bump up his earnings, he can work overtime and bring in as much as $120,000 in a given year. Plus, there’s retirement security – he works for a unionized company with a defined contribution pension plan.

Choosing to study a trade has paid off with plenty of opportunity. Mr. Hajnal works with large organizations such as universities that are upgrading their heating and cooling systems to reduce energy costs and become more efficient.

“I do a lot of building automation – electrical controls for unit cooling systems and [installing] sensors for temperature and humidity,” he says. “I am happy where I am – not all companies do the four-day week.”

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In 2014, Mr. Hajnal bought a townhome in Ajax with his wife. Since then, he’s done numerous renovations, averaging $3,000 a year. “We’re probably going to do a rental suite in the basement at some point,” he says.

He’s also dabbled in the stock market and invested $4,000 in cryptocurrencies. “I got into that about a year ago,” says Mr. Hajnal. “I’ll trade in between two or three currencies using QuadrigaCX, a bitcoin trading platform. So far, I’ve doubled my money,” he says.

Despite his success with cryptocurrencies, Mr. Hajnal says he puts most of his money in more standard investment vehicles, such as the tax-free savings account, where he holds technology and real estate investment trust stocks.

But his real passion lies with real estate. “We definitely want to buy an income property and then rent out the other one,” he says. He hopes to get his current mortgage down to $100,000 by next year to refinance so he can buy another property.

Down the road, he wants to purchase several larger buildings. “The ultimate goal is to have a few low-rise rental properties and live off the income from that,” he says.

His typical monthly expenses:

$1,980 on mortgage.

$55 on property insurance.

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$300 for property tax.

$250 on renovations. “I’ve spent quite a bit. We did the furnace, the AC, we’re planning to do the driveway, we changed the windows and doors. Next we’re going to do the roof and then the powder room.”

$206 for car payment. “I have a 2009 Sonata and my wife has a 2014 Mazda 6.”

$160 on gas. “I travel quite a bit for work.”

$350 for car insurance. “[We’re with] Allstate. It’s for my spouse and I.”

$70 annually for car maintenance. “I can’t remember the last repair.”

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$120 on groceries. “We shop at No Frills, Food Basics or Fresco. We avoid the expensive ones. I normally do the cooking for the week on Saturday and Sunday. We eat a lot of Indian or Asian, lots of pastas. My wife just became vegetarian so we don’t eat a lot of meat.”

$90 on eating out. We might go out once a month. We usually go out for a family member’s birthday.”

$20 on coffee or tea. “We usually make it at home. I used to get a coffee at break. Now I make a bigger one and it lasts all day. It’s a good way to save money.”

$90 on alcohol. “A nice bottle of whisky or cognac will last a few months. In the summer we might get a case of beer. We don’t drink very much.”

$60 for cellphone. “We are with Koodo.”

$14 for Netflix.

$60 for Internet. “It’s Acanac. It’s good – 300 gigabytes a month.”

$14 on Netflix.

$50 on clothing. “I usually shop every six months. I go to Mark’s. I go to Winners or the Gap if I feel like spending a bit more for business-casual clothes. I typically spend $300 each time.”

$15 on hair. “My wife usually cuts mine at home.”

$170 on pets. “[We have] an older dog who requires a special diet and medications. A Bichon Frisé/Maltese. She’s 13 years old now and she has problems with her eyes – she needs creams and drops. And she has kidney stones. We also have budgies – they are two years old. The birdseed will last a couple of months. And we buy the odd toy – it’s $5 to $10 every couple of months.”

$400 per year on camping and hiking. “We’re looking at Bon Echo or Algonquin Park this year. We might rent kayaks this year. We have most of the [gear] already. I would call it glamping.”

$6,000 per year on holidays/trips. “We take two trips of one week each, and two smaller trips on long weekends. In the past year we went to the Mayan Rivera, Mexico and Cuba. We did Washington over the winter and we may do New York City over the summer.”

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The best time to carry out your real estate search

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Although the real estate market is busy throughout the year, it’s important to decide when you’re going to search for, sell, or rent out a property. You’ll save time, energy, and in some cases, even money!

 

You’re looking for a home

If you’re looking to buy, it seems that winter is surprisingly the ideal time to purchase your new home: There are fewer potential buyers on the market, so you hold all the cards to negotiate prices.

Keep in mind that property owners usually work during the day, so they will likely post a real estate ad in the evening after getting home from work. On the other hand, real estate agencies are mainly open during the day, so they are likely to post an ad at any time.

A few words of advice for your search: Note that the available housing in the Grand Duchy is being snatched up faster and faster! Finding a home isn’t easy: Focus on your search for 2 or 3 consecutive weeks by making yourself as available as possible to answer the phone or go to an appointment so that you beat everyone else to the punch. You should also consider setting up email alerts so you will be notified as soon as a new real estate ad is posted!

 

You’re a property owner

Keep in mind, a real estate ad that’s been online for too long does not inspire confidence. Instead, it will make users suspicious, surely wondering about your home’s hidden flaws.

People generally like to schedule their move for over summer vacation because it’s more practical. As an owner, therefore, it is in your best interest to start advertising your property for sale or rent in the spring, particularly during the month of May. You’ll then have a greater chance of getting a better price since the demand is higher.

For owners looking to rent out their property, keep in mind that the type of property is important. Of course, properties of a more modest size, from studios to two-bedroom units, are more likely to be sought out by students and are therefore dependent on the school schedule: Searches will take place from June to September, taking procrastinators into account. For apartments and houses with more than two bedrooms, your property will be sought out during the spring. However, more and more students in the Grand Duchy are seeking housing with roommates, thus requiring larger homes, so your property will potentially be dependent on the school schedule as well if you are accepting this type of lease.

Nevertheless, don’t forget that you have no control over falling in real estate love, so it can happen at any time, whether it’s the ideal time or not!

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CRA finds nearly $600 million in unpaid taxes in BC and Ontario real estate sector

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VANCOUVER—The Canada Revenue Agency has found nearly $600 million in unpaid taxes in Ontario and British Columbia’s real estate sector over the past three years. It has levied $47 million in penalties for the same period.

In B.C. alone, $169 million in unpaid taxes were related to real estate transactions and income tax, the agency found. In Ontario, whose population is three times greater than B.C.’s, that number was $423 million.

A condo building is seen under construction surrounded by houses as condo towers are seen in the distance in Vancouver, B.C., on Friday March 30, 2018.  (DARRYL DYCK / The Canadian Press File)

“I am delighted,” said Richard Kurland, a Vancouver immigration lawyer who for years has lobbied for more scrutiny of real estate transactions, as well as several immigration programs that were directed toward wealthy investors.

“It’s a reasonable representation,” he said of the amount of unpaid taxes, “but I don’t think it tells the whole picture at all.”

The federal agency began examining real estate transactions more closely starting in 2015, and says there continue to be “compliance risks” in real estate transactions in the heated Vancouver and Toronto markets.

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In British Columbia, CRA auditors found that 54 per cent of the unpaid taxes came from not paying GST, while 45 per cent was from income tax.

In Ontario, 90 per cent of the unpaid taxes were related to homebuyers not paying the GST, which is required on all newly built homes in Canada, as well as GST on other real estate transactions.

In a statement, CRA staff said a number of factors increase the risk of tax evasion in the country’s two hottest real estate markets, including a questionable source of funds to buy properties, property flipping, unreported GST, unreported capital gains and unreported worldwide income.

Read more:

CRA conducts simultaneous Panama Papers raids in the GTA, Calgary and Vancouver

British Columbia to require anonymous land owners to reveal their true identities

A mismatch between reported income and lifestyle (such as owning a multimillion-dollar home) can trigger a closer look from CRA auditors to discover whether income is not being reported or being earned illegally.

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Kurland said he believes a new tax information-sharing agreement that will come into effect in September between Canada and 60 other countries will reveal more tax evasion. That’s because even though residents of Canada (who may or may not be citizens) must report their worldwide income to the CRA, the system was not well enforced, resulting in something of an “honour system,” he said.

“It’s what I call the show-me game,” Kurland said of the new agreement between countries. “You show me what this person declared to you … as global income and property, and we will show you what this person declared to us as global income and property holdings.

“It puts people who have not exactly been open with their property transactions in a quandary.”

While in Vancouver much of the scrutiny has been on the impact that buyers from Mainland China may have on the market, Kurland emphasized: “It is not a one-stop China shop at all. This issue cuts across all jurisdictions internationally.” China is one of the 60 countries included in the new agreement.

The information-sharing agreement is part of an effort led by the Organisation for Economic Co-operation and Development to tackle global tax evasion, including secretive offshore banking.

In its February budget, the B.C. government announced it would require land owners to reveal their identity in the province’s land registry, instead of shielding property ownership behind numbered companies.

“Lack of transparency in the land registry means it is not clear who owns nearly half of Vancouver’s more expensive properties. This is wrong,” the provincial budget document stated. “The concealment of beneficial ownership can be part of international webs used to facilitate tax evasion, money laundering, corruption and other criminal activities.”

It added, “Having a registry means we’ll know who owns what.”

With files from Marco Chown Oved and Robert Cribb

Jen St. Denis is a Vancouver-based reporter covering affordability and city hall. Follow her on Twitter: @jenstden

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Real estate market is totally different than stock market now, says Robert Shiller

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  1. Real estate market is totally different than stock market now, says Robert Shiller  CNBC
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