All audience are invited to share their valued opinions on my question please:
Granted that property prices are presently quite low in the buyer's market of Pakistan (specifically Lahore), so what is the best strategy after selling a house in Lahore at a price of CAD $130K:
Option 1: Buy land (plot) in a developing housing scheme in the same city, because if the house is sold at low price due to buyer's market then land prices are also low. Thus neutralizing the effect of buyer's market.
Option 2: Bring money to Canada for investing in real estate to purchase a rental property.
Option 3: Bring money to Canada for investing in RRSP or paying down mortgage on my present home.
Please let me know which is the best option, and is their any other good option which is being missed by me? Thanks in anticipation of your views.
Quote:I do not know anything about the property market there so can't comment on this one.
Originally posted by GoToAIMS
Option 1: Buy land (plot) in a developing housing scheme in the same city, because if the house is sold at low price due to buyer's market then land prices are also low. Thus neutralizing the effect of buyer's market.
Quote:Yes, you can do that.
Option 2: Bring money to Canada for investing in real estate to purchase a rental property.
Quote:Do you have that much room in your RRSP?
Option 3: Bring money to Canada for investing in RRSP or paying down mortgage on my present home.
-----------------------------------------------------------------
"Mah deah, there is much more money to be made in the destruction of civilization than in building it up."
-- Rhett Butler in "Gone with the Wind"
It also depends on future currency values of both PNR and CAD.
-----------------------------------------------------------------
A Proud Indian Canadian
I really appreciate very valued responses on my query, and am really thankful for this kind gesture.
Quote: However, you have to account for paying capital gains tax in Canada on the $130K that you will make by selling the property.
What's your ACB on that property and what's your MTR for capital gains?
Ans: I paid about $50K to get this house allotted by govt on my retirement. So I dont think it is simple capital gain or ACB case, because it was given to me as a retirement benfit so I believe that I dont need to pay any capital gain tax. Am I wrong? Secondly, I dont know what is MTR for capital gains? Can you please advise?
Quote: Do you have anyone there to manage the land/property? Who is going to maintain it and protect it from land grabbers? What would you have to pay such a property manager?
Ans: Nobody, because it will be simply a plot in residential colony being maintained by Defence Housing Authority. I have never heard of land grabbing in that society, but no body knows the future. For general upkeep, however, I will need to pay approx 0.25% of the purchase price per year.
Quote: Between the RRSP and mortgage, you have to evaluate your chances based on - your MTR on income, expected RoR on RRSP investment, your mortgage interest rate, etc.
Ans: Wow... that seems to be tough calculation. Can you please point me to some source please?
Quote: It also depends on future currency values of both PNR and CAD.
Ans: Very correct. So please advise that what can be the best hedging policy or plan to do this. I believe that PNR generally declines about 10% per year but am unable to predict anything.
Thanks again for your valued inputs, and any more response will be highly appreciated.
Quote:I don't believe there is any tax treaty between Pakistan and Canada, like there is between the USA and Canada, therefore, your capital gains will be taxable.
Originally posted by GoToAIMS
Ans: I paid about $50K to get this house allotted by govt on my retirement. So I dont think it is simple capital gain or ACB case, because it was given to me as a retirement benfit so I believe that I dont need to pay any capital gain tax. Am I wrong?
Quote:Marginal Tax Rate for Capital Gains.
Secondly, I dont know what is MTR for capital gains? Can you please advise?
Quote:You can make it simple as well as complicated, depending on how accurate you wanna get.
Quote: Between the RRSP and mortgage, you have to evaluate your chances based on - your MTR on income, expected RoR on RRSP investment, your mortgage interest rate, etc.
Ans: Wow... that seems to be tough calculation. Can you please point me to some source please?
Quote:Since you are unable to predict anything, there's no point in trying to hedge.
Ans: Very correct. So please advise that what can be the best hedging policy or plan to do this. I believe that PNR generally declines about 10% per year but am unable to predict anything.
-----------------------------------------------------------------
"Mah deah, there is much more money to be made in the destruction of civilization than in building it up."
-- Rhett Butler in "Gone with the Wind"
BTW, you said you are retired.
If so, how can you contribute to RRSP?
-----------------------------------------------------------------
"Mah deah, there is much more money to be made in the destruction of civilization than in building it up."
-- Rhett Butler in "Gone with the Wind"
Thanks Patrickm,
Extremely useful input from you.
I got early retirement from Pakistan Military, and then migrated to Canada. However, otherwise I am in mid 40s, so have another 20 years to retire as per Canadian rules
Advertise Contact Us Privacy Policy and Terms of Usage FAQ Canadian Desi © 2001 Marg eSolutions Site designed, developed and maintained by Marg eSolutions Inc. |