# Have you considered the affect of Property Tax on your retirement plans?



## OldPro (Feb 25, 2015)

Anyone who plans to own a house in retirement will include property tax payments in their expense planning. No surprise there at all. But besides including it, have you questioned it at all? 

In retirement, it is important to question every expense you have and look for ways to reduce them if you can. Do you really need the top of the line cable tv package or would the mid-price package be good enough? etc. The same applies to property taxes.

I think of expenses in retirement like insulation in your house. If you don't insulate your attic, you are going to pay more in heating costs in the long run than you would have if you did insulate. I'm always amazed in winter when I drive down a street and see houses with bare roofs next to a house with a roof covered in snow. The one with the bare roof is not insulated and the one with snow still on it is insulated. Meanwhile, you just know the guy in the house without insulation complaining about his heating bills. 

Generally speaking, Property Taxes are likely to be one of the major fixed expenses you have in retirement if you own your house. Yet, the can vary a great deal from place to place. That to me means they are worth looking at and asking if living somewhere else would not be a better idea. I have a neighbour who would like to live east of Toronto in the say Pickering or Oshawa area to be nearer family. The house prices vs. where he now is don't bother him. Houses cost more there but he has the capital and knows that generally speaking, that capital value will likely be maintained and it will go to his kids when he dies.

But the same is not true of Property Taxes. That is money that once paid is gone forever. So he looks at Pickering/Oshawa compared to where he is and sees property taxes for a comparable property to his current home as being double in cost. He can afford it but doesn't see it is worth it and would rather save that money and leave it to his kids. To each his own of course.

Another aspect is simply why spend it if you don't have to and you see no value in doing so. If you would be happy in living in either A or B and B will cost you double in taxes what A will, why would you ever choose to live in B? That makes no sense at all.

Nor does finding lower property tax rates mean you have to 'down grade' or live in a less desirable area at all. Some people might be surprised to read that the average property tax in Saskatoon is higher than the average in Vancouver for example.
http://www.huffingtonpost.ca/2014/09/27/property-taxes-canada_n_5890090.html

That article only covers major cities of course and says nothing aboout smaller municipalities. Nor is any comparison a simple thing to look at. But when you find that two comparable properties in two comparable size municipalities can differ by more than 100%, you might want to give it some thought. For example in a comparison I foud covering 2007, property taxes on comparable houses varied from $1700 to $4200. And as the Vancouver vs. Saskatoon differences show, it is not necessarily the higher priced house that has the higher property taxes. You can scroll to pages 195 and 196 on the following link to see a comparison on a 3 bedroom detatched home in various Ontario Municipalities in 2007 to see that variance from $1700 to $4200 I mentioned. Wasaga Beach vs. Toronto (south). http://www.greatersudbury.ca/conten...e_Taxes_BMA_Municipal_Study_Dec_5_2007-13.pdf

If two places, to live in retirement, appeal fairly equally to me and one will cost me $2k a year more in property taxes, I know which one I would choose to live in. When one appeals more to me (for examples sake) Wasaga over Toronto AND I'll get more house for my money on a bigger lot etc. besides the lower taxes, then it becomes a no brainer.

The question I have is how many people even give this any thought when they retire? Especially in those places where not only taxes are lower but house prices are as well.


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## Davis (Nov 11, 2014)

OldPro said:


> I have a neighbour who would like to live east of Toronto in the say Pickering or Oshawa area to be nearer family. So he looks at Pickering/Oshawa compared to where he is and sees property taxes for a comparable property to his current home as being double in cost. He can afford it but doesn't see it is worth it and would rather save that money and leave it to his kids.


Speaking as a child (I have none of my own), I would rather having my parents living closer to my in their old age than leave me more money when they die. I expect that people with children would value grandparent time with their kids more than cash. But as you say, each to his or her own.



> When one appeals more to me (for examples sake) Wasaga over Toronto AND I'll get more house for my money on a bigger lot etc. besides the lower taxes, then it becomes a no brainer. The question I have is how many people even give this any thought when they retire? Especially in those places where not only taxes are lower but house prices are as well.


And for a lot of other people, having more money tied up in a house and even paying more in property taxes makes sense if it means having access to the benefits of big city living -- museums, art galleries, restaurants, shopping, courses at colleges or the school board.... There is also the issue of health care facilities -- think of the people who buy cheap retirement housing in Elliot Lake, and then spend their time flying or driving to Toronto for medical specialist appointments. I was visiting Haida Gwaii (Queen Charlotte Islands) a number of years ago and saw that they were converting the officers' houses on the old Canadian Forces Base into retirement homes ($10,000 each in 1998 or so). But what is there in Haida Gwaii for recreation, entertainment, and specialist medical care? They were building a golf course. 

Any analysis of options should start with the lifestyle choices - activities vs. the quiet life, proximity to family and friends, proximity to health care facilities - and should include provincial and municipal assistance provided to seniors for property taxes (property tax credits and grants, property tax deferrals or reductions). The property tax bill doesn't tell the whole story.


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## Plugging Along (Jan 3, 2011)

We have thought about this, but have found that property tax is not necessarily correlated to house size or price. 

I was reLly surprised to find out our 1400 sq ft recreational place on a tiny tony town was the same price for property tax as our place on the city. I know winnepeg taxes are higher than calgary based on housing size and cost, which surprised me too.


For us, property tax will be one of the last things we look at in retirement. Our driving factors for where will love in retire is based on the lifestyle and more importantly family. We will pay a higher price to have this and be near family.


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## CalgaryPotato (Mar 7, 2015)

If you say, downgraded from a million dollar home, to a three hundred thousand dollar home in the suburbs I think the least important part of the financial benefit of that would be the property tax difference. Sure it needs to be factored in... but it just seems like one tiny piece of the big picture when looking at the place you want to live in retirement.


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## OldPro (Feb 25, 2015)

As I wrote,
"If two places, to live in retirement, appeal fairly equally to me and one will cost me $2k a year more in property taxes, I know which one I would choose to live in. When one appeals more to me (for examples sake) Wasaga over Toronto AND I'll get more house for my money on a bigger lot etc. besides the lower taxes, then it becomes a no brainer."

Therefore, comments about why one place would appeal to you over another are irrelevant to the question I asked. That is specifically why I wrote, 'appeal fairly equally', to avoid all the other factors in a decision. Assume your choice was between places equally near to your family or theatres and restaurants etc. have you given thought THEN to Property Taxes. I didn't suggest putting Property Taxes at the top of your criteria list of where to live. I asked if you considered it at all. 

There is never just one place you could live and meet other criteria whatever they might be. You don't need to live next door to your kids do you? You can live east of them or west of them as an example. If taxes are lower east of them, then what? 

My point is that I believe a lot of people don't consider it at all. According to a Russell Investments report, the average retiree couple spends about $34,400 per year. Of course some spend more and some spend less. But even at the average of $34k, cutting $2k off their fixed spending is signifigant and should be worth considering, just like insulating your house to save on heating is. Same house, same temperature, less cost. Same house, same other desired criteria, lower cost. 

Otherwise, you start moving towards the 'penny wise and pound foolish' (English saying) side of things. You look for the cheapest cellphone plan (penny wise) and then spend unnecessary thousands on Property Tax (pound foolish).

CalgaryPotato, if you saved $2k per year for every year you are retired (average Canadian manages 22 years) means you spent $44k less overall. That $44k at the end of life could be very signifigant to someone who needs to be in an extended care facility. What does downgrading from a $1mil home have to do with the rest of the world? What 'If you say', you downgrade from a $200k home to a $100k condo. Is $2k per year the least important part of the financial picture in that case? Is it a 'tiny piece of the big picture' then? 

If you have a $1 mil house and a $100k income in retirement, live wherever you wish. Waste money if you want to but try to see things not just from your own perspective. You could say, it doesn't matter to me in my circumstances but I can see where it could be very signifigant to a couple who only have goverenment pensions that total $24k per year between them to live on. Those are the people that need the most help with how to handle their money in retirement. Where they choose to live and the Property Tax they will pay can be very signifigant to them. 

It should of course matter to everyone regardless of income. You don't pay more for a cellphone contract than you have to to get the service you want do you? Why would you ignore Property Tax and yet look for the best cellphone deal? There's no sense in that IF IF IF all else is equal.

The qustion is, do they even think about it as there being a choice?


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## Davis (Nov 11, 2014)

Oldpro, people here are not attacking you for what you wrote, or even disagreeing with you. We are discussing. Because it is a discussion forum. There is no need to be so defensive. 

I agree with you that people should look at all costs in making choices for their retirement. Property taxes are an important consideration. So are maintenance costs, utility costs, transportation costs.... Each will vary by location, size of residence, age of residence, condition of the residence, etc. 

I get what you are saying about "all other things being equal". In economics the Latin phrase is used "_ceteris paribus_". But all other things are never equal, are they? _Ceteris _is usually _non paribus_. 

Property tax is one of a long list of things to consider. You add value to the discussion on CMF by encouraging people to think about it. Trying to limit the discussion by saying everything else is irrelavnt to the question you raised makes the discussion less valuable. Also, I think you will find that people in discussion forums rarely heed attempts by an original poster to control the discussion.


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## CalgaryPotato (Mar 7, 2015)

It isn't really a choice though, not in and of itself in MOST cases. You're right, if switching from a $200,000 condo to a $100,000 condo changed your property taxes ($2000 in the same city), the property tax difference wouldn't be completely insignificant. But in Calgary lets say, you'd have to switch from a million dollar home, to a $500,000 home (approximately) to save $2000 a year in property taxes. At that point, the savings in the property taxes, becomes such an insignificant part of the equation that you probably shouldn't be factoring into it.

If you move to a different city then the property tax levels may differ significantly, but you may also get completely different services for your money. There also might be different levels of user fees for things. It can be a dangerously apples to watermelons comparison.


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## janus10 (Nov 7, 2013)

I certainly have made allowances for a different commitment to property tax because of two factors: the house will be worth much less AND we will be moving to a different part of Ontario. 

Unfortunately, our tax rate is quite a bit lower than where we plan to move (around .8% vs. 1.4%). So, it's not as large a saving as I would have hoped especially considering that they are projecting in 2016 to use 2012 value assessments (is that normal for other municipalities to be so many years behind?).


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## cainvest (May 1, 2013)

OldPro said:


> You could say, it doesn't matter to me in my circumstances but I can see where it could be very signifigant to a couple who only have goverenment pensions that total $24k per year between them to live on. Those are the people that need the most help with how to handle their money in retirement. Where they choose to live and the Property Tax they will pay can be very signifigant to them.


Just like when people are working, they need a budget so they don't over spend. If moving to reduce property taxes, and maybe gain some money from downsizing, works for their budget then moving in something to consider. Of course there are many other ways to save money if one's budget is tight, really depends on where your money is going and how much you have left.


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## gibor365 (Apr 1, 2011)

For us property tax , gas or hydro bills doesn't have any effect on our plans...because those expenses are predictable and I have all of them in annual spending report.... I'm more concerned about unpredicatable expences like some issues with your home/car that you have to spend significant amount of money or dental expenses (or amy other medical expenses that not covered by OHIP)...


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## Eclectic12 (Oct 20, 2010)

OldPro said:


> Anyone who plans to own a house in retirement will include property tax payments in their expense planning. No surprise there at all. But besides including it, have you questioned it at all?


Kept in mind when considering where to move to for me ... and certainly some my parent's friends have done well by moving from a high property tax, high housing cost area to one with reasonably comparable services.





OldPro said:


> ... Wasaga Beach vs. Toronto (south) ...
> 
> If two places, to live in retirement, appeal fairly equally to me and one will cost me $2k a year more in property taxes, I know which one I would choose to live in. When one appeals more to me (for examples sake) Wasaga over Toronto AND I'll get more house for my money on a bigger lot etc. besides the lower taxes, then it becomes a no brainer.


Interesting ... my mom's friend who lived at their cottage in Wasaga Beach terrified her kids with the number of times the phone line blew out in winter storms and the lack of services (I seem to recall the ambulance running into difficulties getting to the neighbour one fall).

I suppose this could be location and/or the services have been upgraded in the last couple of years but the info from the family is that the services are substantially different.


On the other hand, for the other situation ... friends moved from Ottawa to Waterloo to be closer to family when the first baby was born. The proceeds from the Ottawa condo paid for a much larger house with yard. I can check but I expect that property taxes also were favourable.

Interesting that the link is listing a bit over an $80 difference Waterloo to Ottawa ... I seem to recall those moving to Waterloo saying about a $1200 drop for almost the identical house square footage and a larger yard.




OldPro said:


> The question I have is how many people even give this any thought when they retire? Especially in those places where not only taxes are lower but house prices are as well.


Those willing to move with nothing putting them to a particular area may have looked at it ... I'm not sure where others would put it in the list of priorities.


Cheers


*PS*

I suspect the drop in property taxes was a bonus but relatively insignificant compared to selling in Toronto East and moving to Midhurst (near Barrie).

Then too, what happens in the area can affect the property taxes as well. I suspect that along with all the farm land being converted to sub-divisions of houses in places like Grimsby and Beamsville, the property taxes have shot up dramatically over the years. Using a simple example, I expect that stopping for garbage ever 150 feet or so where it used to be a quarter of mile between stops changes things.


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## OnlyMyOpinion (Sep 1, 2013)

OldPro said:


> Anyone who plans to own a house in retirement will include property tax payments in their expense planning... But besides including it, have you questioned it at all?... That to me means they are worth looking at and asking if living somewhere else would not be a better idea...
> The question I have is how many people even give this any thought when they retire?


No, I would not consider moving only on the basis of lower property taxes.


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## RBull (Jan 20, 2013)

Yes, we considered all current expenses and potential future ones, including property taxes before we retired. We changed houses not long before we retired, however within relatively the same tax community. 

We pay some of the highest property taxes in the country however this does not change our decision on where we want to live.


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## Davis (Nov 11, 2014)

To answer only the specific question, our retirement plan, which takes effect June 2016, has a line item for property tax using our current tax inflated by 2% per year, i.e., assuming that we continue to live in our downtown condo. For the reasons I've identified before, we are not planning to change our way of life to save on property tax.


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## My Own Advisor (Sep 24, 2012)

I'm not near retirement age yet but I have assumed for our retirement plan about 2-4% inflation for all expenses. Property taxes included.

FWIW, we used to live in a 1,200 sq. ft. condo in Ottawa. Property taxes almost a decade ago there were close to $3,000 per year. We own 1/2-acre lot now. Property taxes are less than $4,000 per year 10 years later. Go figure


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## lightcycle (Mar 24, 2012)

This isn't even necessarily a retirement question, it applies to anyone looking to make a move.

I think the answer is that if your spreadsheet of costs comparing potential places to move to (mortgage payments, utilities, etc) includes a line item for property tax, then you're probably going to use the same line of thinking when deciding where to move for retirement.


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## gibor365 (Apr 1, 2011)

My Own Advisor said:


> I'm not near retirement age yet but I have assumed for our retirement plan about 2-4% inflation for all expenses. Property taxes included.
> 
> FWIW, we used to live in a 1,200 sq. ft. condo in Ottawa. Property taxes almost a decade ago there were close to $3,000 per year. We own 1/2-acre lot now. Property taxes are less than $4,000 per year 10 years later. Go figure


I've never lived in condo in Canada, but I've heard from friends who live, that except property tax, there is a maintenance fees that increase every year and by much higher % than inflation or property tax ...
When we decide to downsize our house to condo, we should calculate this expence also


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## My Own Advisor (Sep 24, 2012)

Gibor,

I still have the paperwork, what the condo fees we were charged. 

When we moved in: $325 per month in condo fees.
When we left, less than 5 years later, $425 per month. 
I looked online recently...$549 per month. 

This does not include any special assessments performed for the reserve fund. 

Like high mutual fund fees for common folks, watch the condo fees for common areas!


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## GreatLaker (Mar 23, 2014)

In my condo the common expenses have increased an average of 3.6% per year over the last 10 years. You can't compare condo expenses to CPI inflation because condos don't buy the typical balance of goods and services that make up the CPI, and items that don't increase a lot like consumer electronics and clothing are not purchased by condos. Utilities (gas, water, electricity) make up 1/3 of the budget. 

There is also the lifestyle factor. I live in a downtown area where there are very few single family houses available. I walk to work, and to most of my shopping and recreation, so let's see, my expenses for commuting to work (gas, parking, depreciation, wear & tear, increased insurance costs) are exactly... $zero for more than a decade.

But yeah, before anyone buys a condo, take a good look at the budget and reserve fund to try and avoid any unpleasant surprises down the road, especially condos that were registered before 2002 when the current condo act went into effect and reserve fund requirements were much less rigorous.


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## IFITSTOBEITSUP2ME (Mar 6, 2015)

Revenue Condo in City limits suburbs bought 2008 Condo Fees were $138/mth. This year $538.50/mth. We won't talk about the two assessments. Property Taxes in city much much cheaper than on acreages outside of the city. MD cites the reason being due to less homes to contribute to the overall taxes needed to collect to maintain roads, services etc. Hmmm, yeah that makes a lot of sense to us. We got no street lighting, no garbage collection, very little services, and the heaving has got worse year after year on much used arteries in the area but no sign of upkeep or repair for several years.

For us property taxes and insurance (increased 70% in one year over the previous and we have never had a claim) have become a very bitter pill for us to swallow. We can't wait to finally be unshackled from the personal cost of owning and maintaining a home, both here and in the USA. Between those two properties we pay over C$15,000 a year just on property taxes, being stung in USA as non-homesteaders, neighbours pay less than US$4K a year we are more than double that = they wanted our money investing down there in 2008/9 when nothing was selling, now the worm is turning with increased valuations causing huge increased property taxes. 

We will likely keep some revenues until they either increase more in value (looks like they are this year heading south though!) or as long as they are positive cash flowing. Anything else that doesn't pay it's way we are cutting loose as we prep to go into retirement in about 2 years time. Must admit we are more than ready to simplify our lives substantially, shake off the shackles that bind and hopefully find a miracle, safe with an above estimated inflation rate of return in the next two years. Well, we can all dream can't we? I hope to win the lottery as well (LOL).


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## Plugging Along (Jan 3, 2011)

OldPro said:


> As I wrote,
> 1. Assume your choice was between places equally near to your family or theatres and restaurants etc. have you given thought THEN to Property Taxes. I didn't suggest putting Property Taxes at the top of your criteria list of where to live. I asked if you considered it at all.
> 
> 2. There is never just one place you could live and meet other criteria whatever they might be. You don't need to live next door to your kids do you? You can live east of them or west of them as an example. If taxes are lower east of them, then what?
> ...


1. Sure, have looked into property taxes when I bought my house and my other properties, but based on my other criteria, it's not that important to me.

2. I have very specific criteria on where we would like to live, and being in the same town as our family and friends is the main criteria. That leaves us with pretty much one choice. I always knew where my final home would be. I would pay the extra $2K a year on tax to have that. That might change as I get older, but we have been the type of people to know what we want even when we have travelled. In fact, we have been looking for the area and bungalow we want to retire in since our early 30's. 

3. I agree that those people who are retiring on tight budgets should look into this. However, I am guessing that this forum, most people are not looking at retiring with the bare minimum. Honestly, I think if $2k is going to make that much of a difference, one hasn't planned their retirement very well. I would rather work an extra year or two, than be that tight in my retirement. This goes back to another planning for retirement thread. 

4. Sure, IF IF IF it was equal , but it is not. If I had to be in the next closest city which is an extra 45 minutes away, which doesn't have the same ammeneties that my area currently has, and had to drive in to visit friends and family, then I wouldn't do it.


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## Eclectic12 (Oct 20, 2010)

GreatLaker said:


> ... But yeah, before anyone buys a condo, take a good look at the budget and reserve fund to try and avoid any unpleasant surprises down the road, especially condos that were registered before 2002 when the current condo act went into effect and reserve fund requirements were much less rigorous.


Losing control of the maintenance is why I've never been a fan ... one can do all the due diligence, have a great board and then when enough condo members decide to change the board - the whole situation can change dramatically for the worse.

I think it was three years to pave the parking lot at a friend's condo where despite the delays and no shows, the board kept paying on schedule for work that was not completed.


Cheers


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## Eclectic12 (Oct 20, 2010)

Plugging Along said:


> ... Sure, IF IF IF it was equal , but it is not...


That's the key IMO ... where it's equal - I haven't seen a lot of equal in the house buying I've done so far. 

I expect to have a bit more flexibility in retirement so maybe there will be more of an opportunity than now.


Cheers


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## gibor365 (Apr 1, 2011)

My Own Advisor said:


> Gibor,
> 
> I still have the paperwork, what the condo fees we were charged.
> 
> ...


That what I was talking about  more than 6% increase annually when inflation around 2%....


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## My Own Advisor (Sep 24, 2012)

Condos = you pay for convenience


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## rikk (May 28, 2012)

My Own Advisor said:


> Condos = you pay for convenience


I dunno about convenience ... google "condo horror stories", "condo hell", ... yikes!!!


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## My Own Advisor (Sep 24, 2012)

Fair enough rikk, I meant from the perspective that you pay a fee and the building is taken care for you.

You are paying a sum of money to have others do some dirty work. That comes with a price tag.

There are certainly horror stories...!!


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## rikk (May 28, 2012)

^ Understood, meant in fun ... but some of the condo stories that came up, whoa, e.g. ... http://www.macleans.ca/society/life/condo-hell/ Disclaimer: never owned, nor will ever own, a condo ... even if it saved me $2K in property tax.


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## RBull (Jan 20, 2013)

Speaking of condos I doubt I would ever own one either. The lack of control on costs/decisions and various ownership market risks make it unappealing to me vs. renting an apartment, at a later time in life.


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## hboy43 (May 10, 2009)

Hi:

I really can't see property taxes driving one to relocate solely to get a reduction of same. Even the hypothetical $2000 up thread will be peanuts in comparison to the $20,000 to $40,000 of actually packing up and moving. Discussing this among the retired set, most will be either dead or moved along elsewhere long before any tax savings exceed relocating expenses.

I almost certainly pay the highest property taxes of anyone here, both as a percentage of the property value and in relation to what I get in services. I am so rural that something like 65 or 70% of the municipal portion goes to the roads department. My personal library has about 1/4 the number of pieces of the local library which is open about 12 hours a week. I deliver my garbage and recycling to the facility. The fire department consists of about 4 backpack sprayers, that is to say there is no fire department and that is what the municipality owns and what actually showed up by way of specialty fire equipment at an early spring grass fire about a decade ago.

The compensating factor for my property tax situation is that the 28 acres of view, dirt, rock, and trees I own cost between $500 and $1000 an acre. I essentially live on my own park. My annual $3000 property tax bill would not even pay the interest on the money borrowed to buy a 30 foot wide lot in even Ottawa let alone Vancouver or Toronto.

I live where I want to live and the property tax and whatever services I get falls out of that. I suspect the same for most everybody else.

hboy43


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## Jon_Snow (May 20, 2009)

With $88 monthly property tax, I can easily put up with some of the downsides of condo living, and they really are not that many. Big factor in allowing me to retire early and play in the Baja and the B.C. gulf islands...

The gulf island property is dirt cheap in terms of taxes too...it will get cranked up when I build a cabin there, but it still won't cost me much. Owning a detached house in Vancouver proper would have wreaked havoc on my early retirement plans. I'm so fine not owning a city house.


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## mind_business (Sep 24, 2011)

We will likely own a detached-home up until we can no longer afford it. My wife loves gardening in her own space too much. I'm not the type that wants to scrimp and save in retirement, so property taxes is just another line item that we're counting on during retirement.


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## rikk (May 28, 2012)

OT: Speaking again on condos, I understand the appeal ... own your own space, move in, pour the wine, done. Makes perfect sense ... the thing is, I'm ok owning a home, puttering around, redoing a bathroom/kitchen or at least most of it. My current project is my last though ... installing the new flooring in the bathroom upgrade, although not much, was not fun. We like our home very much and have no immediate plans on moving. A builder (reputable, I checked) offered that for my home, he would build a 6 unit luxury condo on the property ... with a concierge no less ... and give me the two upper units. That's maybe $1.8M ... I said no thanks, maybe another time. We like our home ... sell and move to save $2K in property taxes? Nope.


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## Retired Peasant (Apr 22, 2013)

I wouldn't say that it was a determining factor in where we live; we chose to live in the sticks because that is where we wanted to live. However, I see that we are paying 11% of our income on property taxes, which really only buys us road maintenance/plowing. Even garbage collection costs extra.


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## OldPro (Feb 25, 2015)

I guess should have started this thread somewhat differently. Perhaps by beginning with something like, 'for those who have the flexibility to choose where they live and are neither constrained by other factors or willing to waste money, have you considered...............?'

Being able to afford to pay more Property Tax doesn't make it a good idea to do so. I can't see the sense in anyone saying, 'it's not important to me'. That is no different than saying, 'It's not important to me if I pay more for a cellphone than I need to.' 

If you wish to live somewhere because of other factors, then that makes sense but if you have a choice between 2 places that appeal equally and one has higher taxes than the other then it only makes sense to consider that difference.

For example, the house we live in now is the first house outside of the town boundary. My neighbour pays $1000 more in taxes than we do for exactly the same services. Another example. My Brother pays slightly less Property Tax on a detached house than he did for a condo in Toronto that was less than half the size. 

When you read comments like the one by Retired Peasant who says it costs 11% of their income, it should be obvious why it may be worth considering for those who are not constrained in their choice by other factors.

Mind_business, my Wife is an avid gardener as well. We have a 100x180 foot lot. Compare that to a typical city lot. When you write, "so property taxes is just another line item that we're counting on during retirement.", after having mentioned why you want to live in a detached home, I don't see any connection to why accepting a higher Property Tax somewhere would be required in order to garden. What does "just another line item" mean? You don't care how much it costs? Are you saying you couldn't find a place with a garden AND lower Property Taxes?

For those interested in the pros and cons of condo living, why don't you start a thread on it. It isn't the subject of this thread.


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## mind_business (Sep 24, 2011)

OldPro said:


> I guess should have started this thread somewhat differently. Perhaps by beginning with something like, 'for those who have the flexibility to choose where they live and are neither constrained by other factors or willing to waste money, have you considered...............?'
> 
> Mind_business, my Wife is an avid gardener as well. We have a 100x180 foot lot. Compare that to a typical city lot. When you write, "so property taxes is just another line item that we're counting on during retirement.", after having mentioned why you want to live in a detached home, I don't see any connection to why accepting a higher Property Tax somewhere would be required in order to garden. What does "just another line item" mean? You don't care how much it costs? Are you saying you couldn't find a place with a garden AND lower Property Taxes?
> 
> For those interested in the pros and cons of condo living, why don't you start a thread on it. It isn't the subject of this thread.


I'm not sure if you've joined this board to share or just to criticize. You seems to be one of those know-it-all types that can't see other viewpoints. No worries though, I'm sure you'll correct me.

You also make a lot of assumptions. Firstly, I don't accept a higher property tax as being acceptable, as long as we can get what we want at a lower tax. I think you'll find most, if not all people contributing to this board to be relatively intelligent with life and finances. We may not all have the same vision of retirement and finances, but most of us respect other people's viewpoints. Btw, we don't live in the city. We have a three acre property with relatively low taxes compared to living in the city. However, it still represents a 'Line Item' in our budget. Having said that, we are ... and will be, able to afford to live where we want, and where it provides our choice in lifestyle. I'm not going to let property tax dictate where we live ... within reason. That's our choice.

If you want to limit the posters to your threads by restricting content to like-minded individuals, as you've stated in your first paragraph ... be my guest. But I'd suggest you re-read your first paragraph to see if you want to continue insulting people by telling us we're 'wasting money'. Just a thought.


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## RBull (Jan 20, 2013)

You want to hope someone with some common sense in government doesn't see the foolishness of houses next to one another paying significantly different property tax for the same services. Although common sense in government is probably not very common.


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## My Own Advisor (Sep 24, 2012)

RBull said:


> You want to hope someone with some common sense in government doesn't see the foolishness of houses next to one another paying significantly different property tax for the same services. Although common sense in government is probably not very common.


+1


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## Eclectic12 (Oct 20, 2010)

RBull said:


> You want to hope someone with some common sense in government doesn't see the foolishness of houses next to one another paying significantly different property tax for the same services...


I've had friends complain that when their area was absorbed, depending on the lot location, this did happen and too years to equalise.

In an case, as I read the thread ... the sample comparison is Wasaga Beach versus Toronto so I think the "lots beside each other" is the extreme example and not the typical situation for the discussion.


As I've posted earlier ... relatives that didn't have anything driving them to a particular area did well from a property tax perspective - though it was one factor of many. A key one being they planned to move when they retired to get away from the busier city life.


Cheers


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## cainvest (May 1, 2013)

OldPro said:


> If you wish to live somewhere because of other factors, then that makes sense but if you have a choice between 2 places that appeal equally and one has higher taxes than the other then it only makes sense to consider that difference.


I would gather that you would also include any costs associated with moving to get lower property taxes. What would the typical ball park figures be for those costs?

For example, would it be worthwhile to move 20kms in order to save $500/year on taxes ... how long would you estimate it will take before you're saving money from the taxes?


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## janus10 (Nov 7, 2013)

You also could see a big difference in car insurance rates depending on where you live. Would I determine where I'm going to retire based on that factor? Never even considered it. There is a Real Canadian Super Store and a Walmart near me that offer price matching (the flippp app is GREAT). Would I only move to where stores offer grocery price matching? Uh, no.

When you look at articles explaining what are the key factors for a happy retirement, money is a key aspect but not the only one.

I'd imagine that larger metropolitan areas allow their services to scale more efficiently so the tax rate in general is lower than small municipalities. The very brief research I've done all show significant increases in the mill rate, but no city I've looked at is as large as where I live now. 

So, the driving force will be to divest ourselves of a good portion of our net worth tied up into one asset (our house) and both get a smaller home and a cheaper home.


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## OnlyMyOpinion (Sep 1, 2013)

cainvest said:


> I would gather that you would also include any costs associated with moving to get lower property taxes. What would the typical ball park figures be for those costs? For example, would it be worthwhile to move 20kms in order to save $500/year on taxes ... how long would you estimate it will take before you're saving money from the taxes?


Very good point. Here is a timely video by Preet Banerjee that discusses the costs to consider when moving. They can easily exceed $30k. You can stay put and pay higher property taxes for a lot of years before moving for lower taxes would make sense - it is a lame suggestion. https://www.youtube.com/watch?v=YJJZTCmB6Aw#t=161


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## RBull (Jan 20, 2013)

cainvest said:


> I would gather that you would also include any costs associated with moving to get lower property taxes. What would the typical ball park figures be for those costs?
> 
> For example, would it be worthwhile to move 20kms in order to save $500/year on taxes ... how long would you estimate it will take before you're saving money from the taxes?


Yes, I agree. It would only make sense to consider all moving costs as well as taxes. real estate selling fees, legal fees, deed transfer taxes, moving expense (if applicable), potential home repairs/improvements vs what may be known/done with your own home


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## OldPro (Feb 25, 2015)

RBull, re, "You want to hope someone with some common sense in government doesn't see the foolishness of houses next to one another paying significantly different property tax for the same services. Although common sense in government is probably not very common."

Such differences happen all the time and I can't see any way that would end. Remember, I said our house is the first outside the town boundary. There is always a line drawn somewhere. If you carry the 'foolishness' to its seemingly logical conclusion you would have to say Property Tax should be the same everywhere that the same services are provided. While that might make sense, it's never going to happen. 

Cainvest, where did I ever suggest moving 20km to save $500? That's isn't an argument at all, that's a giant assumption. What I am saying is that if you are going to move ANYWAY, it MAY be worth considering if ALL more important criteria are EQUAL. When we moved from BC to Ontario, we had to pay to move regardless of WHERE we moved to. The cost of moving was irrelevant in that any difference between moving to A or B was insignifigant in terms of perhaps differing by $500 one way or the other as a ONE time cost vs. an annual ongoing difference in Property Tax cost.

So in answer to your question, "how long would you estimate it will take before you're saving money from the taxes?", the real answer based on a real move, is year ONE.

OMO and RBull, I'm surprised you didn't see the obvious flaw in cainvest's red herring objection.

Janus10, you may be a perfect example of where it MAY make sense to consider Property Tax in your choice of where to move to since you do intend to move. You want more bang for your buck in terms of what $X will buy you in one place vs. another. "both get a smaller home and a cheaper home."

For example, my Brother sold his condo in Toronto and bought a detached house in a small town in southwestern Ontario. He could have bought 3 of his house for what he sold the condo for. So 2/3s of the capital tied up in his condo was freed up for investment and income generation. What's more, the detached house is twice the size of the condo. 

It happens to be the same town we live in (he did look elsewhere but couldn't find any better bang for his buck). He actually pays more Property Tax than we do for a smaller house on a smaller lot but his house is in town whereas ours as I have said is 'out' of town by 50 feet. He had one criteria however that made him choose the house he did. He wanted to walk no more than 5 minutes to a restaurant for breakfast, pick up a paper and rent a video etc. Those were not criteria on our list. But what my Brother DID want was lower Property Tax than he was paying in Toronto and that he got.

When someone is going to move ANYWAY and hopes to release capital by finding a lower cost home, that lower cost should also take into account Property Tax. Nowhere have I suggested that someone should move ONLY to save on Property Tax. ALL I am suggesting is that it should be factor to look at IF moving. it MAY be a major factor as in the example we've had here where it represents 11% of someone's income or it may be a much smaller factor where someone simply wishes to live close to relatives but it should be on the list of factors somewhere.

As an aside janus10, a couple I recently met sold a large house in north Toronto with the intention of moving to southern Alberta. Same scenario, free up capital and find something a little smaller and cheaper. They found nothing in southern Alberta and drove all the way back across to Ontario looking in various towns all the way. They ended up in Chatham, Ontario.

When it comes to 'bang for the buck', nowhere in Canada beats southwestern Ontario. 
http://www.thestar.com/life/homes/2009/09/26/ontarios_sunshine_coast_draws_retirees.html
http://www.theglobeandmail.com/glob...-canadas-most-southerly-city/article16798932/
Most Canadians I would guess don't even know that Ontario's 'Banana Belt' is at the same latitude as northern California or Barcelona, Spain.


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## cainvest (May 1, 2013)

OldPro said:


> Cainvest, where did I ever suggest moving 20km to save $500? That's isn't an argument at all, that's a giant assumption. What I am saying is that if you are going to move ANYWAY, it MAY be worth considering if ALL more important criteria are EQUAL.


20km for $500/year was just an example and for the moving ANYWAY part, see below. 



OldPro said:


> Generally speaking, Property Taxes are likely to be one of the major fixed expenses you have in retirement if you own your house. Yet, the can vary a great deal from place to place. That to me means they are worth looking at and asking if living somewhere else would not be a better idea.
> 
> If you would be happy in living in either A or B and B will cost you double in taxes what A will, why would you ever choose to live in B? That makes no sense at all.


Sorry it didn't sound like "if you've moving ANYWAY" but "consider moving" to save on property taxes to me.

In any case, one has to total up all costs associated with moving, no matter what the distance. If someone has already decided to move property taxes will likely be a very small consideration for most IMO when compared to location, climate, size and price of the new house.


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## RBull (Jan 20, 2013)

OldPro said:


> RBull, re, "You want to hope someone with some common sense in government doesn't see the foolishness of houses next to one another paying significantly different property tax for the same services. Although common sense in government is probably not very common."
> 
> Such differences happen all the time and I can't see any way that would end. Remember, I said our house is the first outside the town boundary. There is always a line drawn somewhere. If you carry the 'foolishness' to its seemingly logical conclusion you would have to say Property Tax should be the same everywhere that the same services are provided. While that might make sense, it's never going to happen.
> 
> ...


I live in a municipality that underwent significant amalgamation. A couple of cities, town and large rural areas now as one-for administration and tax purposes. And there are numerous other municipal/town changes taking place in my province. This changed the tax situation and generally not for the good.... when you're the people paying on the low end to start with. So, it can and does happen. Hence, my reference regarding you hope it doesn't, which I'm sure is accurate.

No where did you state the qualifier "When someone is going to move ANYWAY" you are now adding with your recent post. In fact we are to infer you were suggesting it is worthwhile to consider moving to save on taxes. Hence the reason I stated what I did and the reason you might interpret this as a red herring. I'm surprised you can't see this. 

In any case all of these costs would logically be considered in any decision to move.


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## Eclectic12 (Oct 20, 2010)

RBull said:


> I live in a municipality that underwent significant amalgamation...
> This changed the tax situation and generally not for the good.... when you're the people paying on the low end to start with. So, it can and does happen. Hence, my reference regarding you hope it doesn't, which I'm sure is accurate.


It's not a new thing as my aunt about ten years before selling the farm was changed from rural (i.e. lower taxes) into town (i.e higher taxes ... plus needing a permit to burn brush) about fifteen years ago. The "just outside the line" situation may last or it may disappear ... 


Cheers


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## RBull (Jan 20, 2013)

Eclectic12 said:


> It's not a new thing as my aunt about ten years before selling the farm was changed from rural (i.e. lower taxes) into town (i.e higher taxes ... plus needing a permit to burn brush) about fifteen years ago. The "just outside the line" situation may last or it may disappear ...
> 
> 
> Cheers


Yes, I would agree.


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## OldPro (Feb 25, 2015)

"Sorry it didn't sound like "if you've moving ANYWAY" but "consider moving" to save on property taxes to me."

If that is how what I wrote was interpreted then I will accept responsibility for not communicating clearly. I took it as obvious that if someone is NOT moving, then they would not be comparing A and B as potential choices. If I didn't make that clear then hopefully it now is.

Re, "If someone has already decided to move property taxes will likely be a very small consideration for most IMO when compared to location, climate, size and price of the new house." cainvest, again, it is if all other criteria are pretty equal, not about putting Property Tax ahead of climate or general location in the hierarchy of importance. If A and B both meet location, climate, size and any other critieria of more importance to you, you may find that Property Tax can then become a deciding factor IF there is a signifigant difference between 2 or more choices.

Eclectic and RBull, we live in Chatham-Kent which went through exactly the kind of amalgamation you are talking about. Old timers here never stop moaning about how it has been detrimental but that of course is what people always do with any kind of change. I don't doubt taxes are probably higher than they were where we are in the 'new' municipality but they are lower than in many other municipalities. Again, if both A and B meet your other criteria then Property Tax can become a deciding factor.

As for a change to any individual property, given that all properties in Ontario are now assessed by 1 agency, they are not suddenly going to change how a property is assessed or classified. https://www.mpac.ca/about/corporate_overview/default.asp Any change now would have to satisfy every municipality in Ontario. I can't see that happening. Such changes have happened in the past and particularly when the new system under MPAC came into affect. That changed a whole lot of assessments. The whole reason for MPAC was to correct inequalities in assessments. But like a said, they always have to draw a 'line' somewhere. Those lines are far more carved in rock now though than they were before.


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## RBull (Jan 20, 2013)

Good to see you've done your homework and seem to be reasonably safe with where you are re changes. 

I don't want to digress too much from your theme but will just say some homework like you've done needs to considered for a move. In my area the whole assessment and tax thing is a complete mess where many people pay less than they should because of under assessments and distorted capped rates system, while those making recent home purchases or those doing renovations with permits essentially pay the freight for all the rest. If moving within the same region here this has to be a major consideration, since staying in the same home is frequently less expensive than downsizing and receiving your "new and improved" assessment.


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## Eclectic12 (Oct 20, 2010)

OldPro said:


> ... Eclectic and RBull, we live in Chatham-Kent which went through exactly the kind of amalgamation you are talking about. Old timers here never stop moaning about how it has been detrimental but that of course is what people always do with any kind of change. I don't doubt taxes are probably higher than they were where we are in the 'new' municipality but they are lower than in many other municipalities. Again, if both A and B meet your other criteria then Property Tax can become a deciding factor.


The point is the rates are written in stone ... where A = B, A is chosen ... is on really going to console oneself with "hey, overall it's down so who cares?"




OldPro said:


> ... As for a change to any individual property, given that all properties in Ontario are now assessed by 1 agency, they are not suddenly going to change how a property is assessed or classified.


Yet with MPAC, I know of many times more people who after talking to their neighbours are disputing the assessment. That's also ignoring the posted complaints about MPAC adding 24% to the size of the house. 

Then there's Timmins where the advice is for everyone to appeal as:


> A reconsideration request will usually lead to a reduction immediately in the property’s dollar value. Why? Because most of the property values in Timmins, especially on homes, are out of line. That value that you think some assessor sweated over for hours to calculate was probably done by a computer.


http://www.timminspress.com/2014/10/19/property-owners-urged-to-appeal-mpac-hikes



Then there's Chryler's minivan plan that appealed their MPAC assessment, resulting in a $5.7 million drop in their property taxes to be paid to the city of Windsor.




OldPro said:


> ... Any change now would have to satisfy every municipality in Ontario. I can't see that happening...


Yet Timmins says:


> When a taxpayer complains about the increase, council members say it is because the value of the property was increased by MPAC, over which it has no control.



Thunder Bay says:


> Now that reassessment is hitting Windsor, Hobbs thinks it's only a matter of time before places like Oakville and Oshawa feel the pinch as well.
> "That's when politicians and Queen's Park start taking notice," he said...
> Thunder Bay recently passed a resolution to try and get a member of city council onto MPAC through AMO.


http://www.tbnewswatch.com/News/366...h_Hobbs_hopes_Queens_Park_will_finally_listen


If changes have to be with approval from the municipality ... why haven't Thunder Bay, Windsor and Timmins made use of this?


Cheers


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