Don't wait until April to renovate
Don't wait until April to renovate
Arguably the worst rollout and management of public policy in B.C. has to be the harmonized sales tax. I mean, it's like walking blindfolded across a farmer's field full of fresh cow flops. The journey will be predictably unpleasant, and the odour of one's missteps will linger for quite some time.
Transition from HST back to GST/PST occurs on April 1 - appropriately, April Fool's Day. Last February, the provincial government took steps to mitigate the HST's damaging impact on many new-home purchases by hiking the rebate threshold from $525,000 to $850,000, capturing 90 per cent of all new homes in the province. Moreover, the rebate was raised from $26,250 to $42,500.
A few days later, cash-strapped property virgins received some relief from Victoria - an income tax credit of up to $10,000 on the purchase of newly built homes, a move designed to also create construction jobs in the province.
Problem is, nothing was done to lift the tax burden from the backs of homeowners contemplating home renovation. Oh, there was a $1,000 tax credit for seniors who install mobility assists in their homes, but renovation - worth $7.6 billion to B.C.'s economy - was not given the attention it deserves.
The industry has been asking provincial lawmakers for a renovation tax rebate to ensure homeowners don't pay any more tax now than they will pay when the HST reverts back to PST/GST. Labour was not taxed under PST before and it should not be taxed on April 1. The legislature does not have a fall session, so the chance of a tax rebate being considered is zilch. Besides, it's a lucrative cash cow.
As I mentioned in my last column, the Greater Vancouver Home Builders' Association (GVHBA) conducted a survey at a recent consumer renovation seminar. One-third of the 180 respondents said they intend to wait for the HST to disappear before starting a renovation.
That response was expected, as the HST finish line is just six months away. But there are compelling reasons not to wait, as the two-thirds who intend to start their renovations soon must have researched. To them, HST is not a significant deterrent. Once they decided to renovate, particularly those at the high end of the budget spectrum, they were eager to wield the demolition hammer right away.
Here are three points that might make homeowners second guess their decision to wait until April.
One: There is no guarantee interest rates will remain as low as they are , so carrying costs for long-term renovation financing could conceivably exceed any tax savings gained by waiting.
Two: The U.S. economy is improving, and housing-start numbers and renovation spending are rising in many major American markets, creating a demand for building materials. Manufacturers that scaled back during the recession are now ramping up operations, a costly process. These added costs will undoubtedly be factored into the selling price of the products they manufacture.
Because of this growing demand south of the border, and it will likely intensify through spring, suppliers here are already seeing price increases for materials such as plywood, drywall and lumber.
Three: If enough homeowners wait until April to start the renovation process, a bottleneck will be created through the spring and summer, and they might end up at the end of a long line. A resulting shortage of available skilled trades could add appreciable time and cost to renovation projects.
I'm just sayin'.
Hold onto your hard hats, two high-energy personalities will lead a who's who of home, garden, culinary and fashion personalities at the Vancouver Home + Design Show next week.
Bryan Baeumler, star of HGTV's Leave It To Bryan, and Jillian Harris, host of W Network's Love It or List It Vancouver, will energetically headline the HGTV Main Stage at BC Place Stadium.
To be held Oct. 11 to 14, the home show has for nearly 30 years been a one-stop showcase for everything in and around the home. Whether you are a homeowner or tenant, urbanite or suburbanite, there will be something that will capture your interest. Attendance is expected to top 40,000.
I have been a home-show junkie ever since my parents took me to the granddaddy of all Canadian home shows, Toronto's National Home Show, many, many years ago. It was always an adventure.
Members of the GVHBA's Renovation Council, at their 1,000-squarefoot Renovation Zone and Ask a Pro exhibit, will be offering free consultations with designers and RenoMark renovators. You can even reserve a consultation time online beforehand at www.gvhba.org.
A construction-site setting, provided by Skyline Scaffold and Western Shrink Wrap, will uniquely define the GVHBA exhibit and provide a backdrop for a display of before-and-after photos of the participants' superb home makeovers, ranging from low budget to sky's-the-limit extravagance. Also available will be a wealth of expert tips to help showgo-ers demystify the renovation process. Visit www.vancouverhomeshow.com for details on Western Canada's largest fall home.
October is Renovation Month across Canada. Whether you renovate to bring your home up to current standards, or to make it more comfortable and energy efficient, your first decision should be to work with a professional renovator - someone who has the technical, management and people skills to turn your ideas into a final product that adds value and enjoyment to your life.
OK, that takes care of the public-service announcement. Now, would you like to win a vehicle?
Home Hardware Stores Ltd. and Toyota Canada have joined forces with the Canadian Home Builders' Association to offer a 2012 Toyota RAV4. Visit www.renomonthcontest.ca to learn about the benefits of working with a professional renovator and fill out an online ballot for a chance to win. Deadline is Nov. 3, 2012. No purchase is necessary.