# higher interest rates will push property taxes sky high



## lonewolf :) (Sep 13, 2016)

Just rent interest rates will most likely spike higher. Compound interest on municipal debt will push property taxes higher


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## heyjude (May 16, 2009)

When you rent, your landlord will be paying the mortgage and property taxes. Increasing costs of landlording will eventually lead to increasing rents.


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## lonewolf :) (Sep 13, 2016)

The higher taxes that everyone is paying will result in having less money to pay for rent. The landlord rents out to try to make money the max rent they can charge is governed by the amount the market is willing to pay. Does not matter if the landlords cost went up the market will only pay so much.


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## Just a Guy (Mar 27, 2012)

I like the way everyone assumes you can just raise rents to cover expenses whenever you want. Sorry people, this is a supply and demand business, the rates you can charge are based on what the market will bear, nothing else. If you overpay for your rental and your expenses are too high, you'll wind up losing your shirt and going out of business, just like any business. Just because you own something doesn't guarantee you a profit. Just because you made a profit yeaterday, doesn't mean you'll make a profit tomorrow if the government, or other outside influences, change the rules. 

This is why it's very important to buy at the right price and why I spend so much time looking for properties. I have to be able to make money in both good and bad times. I need to know my numbers better than others. For example, if the condo fees are too low, I can't say "bonus" because, eventually, they have to come up to their proper level, if not higher to make up the shortfall, or face special assessments. Just because people don't charge the right amount, doesn't mean the money isn't needed. 

I need to factor in for rising interest rates, which many don't believe have an impact, rising taxes, and rising costs...if I can't see long term profits in bad conditions, I don't buy. I may be very conservative, but I can't afford to lose money.


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## new dog (Jun 21, 2016)

Outside of Vancouver there is a spike in disputes of people not paying their rent. People outside of Vancouver are probably lower income and have tight budgets. So raising rents won't help in stopping this problem because people are having trouble paying as it is.

https://globalnews.ca/news/4051813/vancouver-landlord-eviction-disputes-sfu-study/


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## tavogl (Oct 1, 2014)

According to the City of Vancouver, "affordable" rent for a 1 bedroom is now 1700, and 2 bedrooms is 2150. This city is just insane.


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## trentfx2 (Mar 8, 2018)

Seriously i am not surprised at all..
The pricing has to be somehow "market driven" because if it goes lower than 41700, I don' think any developer will be willing to build "affordable home". It is already causing a fortune now days for a developer to assemble those expensive lands and build condos. Who wants to lose money? Unless government is willing to subsidize the cost
look at how much these guys are making




tavogl said:


> According to the City of Vancouver, "affordable" rent for a 1 bedroom is now 1700, and 2 bedrooms is 2150. This city is just insane.


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## lonewolf :) (Sep 13, 2016)

trentfx2 said:


> It is already causing a fortune now days for a developer to assemble those expensive lands and build condos. Who wants to lose money?


 Canada has all kinds of land though the environmentalists are more concerned with the birds & deer then people


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## andrewf (Mar 1, 2010)

heyjude said:


> When you rent, your landlord will be paying the mortgage and property taxes. Increasing costs of landlording will eventually lead to increasing rents.


Property taxes are a kind of land value tax. When they rise, it depresses the value of land because it decreases the economic rent that accrues to the owner of the land. Economic rents don't rise because landlords have higher costs. Landlords are pretty much price takers.


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## birdman (Feb 12, 2013)

lonewolf :) said:


> Just rent interest rates will most likely spike higher. Compound interest on municipal debt will push property taxes higher


The majority of the City of Vancouver borrowings are fixed rate with the majority of maturities being beyond 2021 and these are not affected by changes in interest rates. 2016 Annual report indicates an average rate to maturity of 3.61%, Also, I do not believe interest is compounded. Debt to other municipalities is funded through the Municipal Finance Authority. Pretty complex and I was not interested in trying to review all details.


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