Monday, September 27, 2010

Deemed Disposition

I remembered - sort of at the eleventh hour, as the tenant moves in this week - that I was advised to get an appraisal on the condo at the time that it changes from my primary residence to a rental property.  This change in use from primary residence to income property is a "Deemed Disposition", and it's important to know the fair market value of the condo at this time.

Basically, whenever we do decide to sell the condo, we will be taxed on the capital gain from the time that it was not our own residence.

So as far as I understand, this is the way the tax will be calculated:

Tax Rate (assume 50%) x 50% of Capital Gain.

So, if the capital gain was $100,000, we'd be taxed on 50% of that, and assuming a 50% tax rate, we'd be taxed $25,000 on the $100,000-gain.

However, there is also an exemption for the time that the residence was a primary residence.  That exemption is calculated as:

# of years as primary residence / # of years owned x Capital Gain.

So let's say we sell it in 10 years.  I would have lived in it for 5 of the 15 years I owned it, and so the exemption would be:    5 / 15 x 100,000 = $33,333.33

So the exemption is $33,333.33, meaning the taxable capital gain is:
$100,000 - $33,333.33 = $66,666.67

So in this case, with the exemption, the tax on the capital gains, assuming again a tax rate of 50%:

$66.666.67 x 50% x 50% = $16.666.67 paid in taxes

In any case, I have to have the appraisal done.  Our realtor is working on one for us as we speak.  But does anyone know if I need a licensed appraiser to also step in?  What holds up in the CRA's eyes?

Thursday, September 23, 2010

Keeping cool

I am totally sensing a theme in all our home issues lately.  I seem to have a complete inability to measure anything correctly.  This comes as a shock to me, since for one thing, I majored in Math & Stats in university.  And for another thing, I have two parents who are actually obsessed with measuring and levelling things.  I know, weird, right?

So why is it, that the new fridge didn't fit when it was delivered?

Maybe it's just that I'm tired lately.  Because technically the fridge DOES fit.  But only after some adjustments.  Last week, when Matt and I went fridge shopping, I quickly jotted down the dimensions of the spot that the fridge fits into.  It was only after the too-large fridge was delivered, that I realized I had measured from cabinet to wall - not accounting for the counter overhang, which evidently limits the space by about an inch:

The counter overhangs the cabinets by about an inch... limiting the opening for the fridge.  Note: this is the old fridge.
Luckily, Matt has a cousin who is a carpenter (and a very good one at that).  So after about a week with the new fridge in the middle of our kitchen, he came over and cut off that extra inch of overhang.  And our new, beautiful, super-cool (pun!) fridge fits into that space just perfectly. 
I love the new fridge!  It is a Samsung bottom-mount.  The food is now conveniently at eye-level.  The freezer is surprisingly spacious compared to some of the other bottom-mounts we looked at.  And this one is a little less deep than the old one, which makes the room feel bigger, and makes it easier to get into the tight little corner cabinet.

So I CAN measure... sort of...!

Wednesday, September 22, 2010

The one that got away

The couch didn't fit.

At about midnight on the night before the couch was to be delivered, it occurred to me that the chaise part is wider than the rest of the couch, and I was basing all the measurements on the couch part.  The entire couch and chaise would have both fit no problem in the TV room.  But despite all my careful measurements, pivoting on the landing of our U-shaped stairwell would have been impossible.  At 2:00 am I was still standing on the landing, tape measure in hand, dumbfounded as to how I could have screwed up so incredibly.  I was right though.  The delivery guys showed up early in the morning, and while they left us with our super cool new desk chair, they drove away with the couch back on the truck.  It was pretty disheartening.  I envisioned us having a forever empty TV room, and watching movies on lawn chairs for the rest of our years in this house.

My Mom kept saying "go to Ikea, go to Ikea, it might just work".  We had been resisting Ikea couches.  And I am pretty familiar with every single Ikea item, and never felt much affection for any of them anyway.  But yesterday, we went to Ikea to "check them out".  And didn't we realize that the Karlstad was not nearly as bad as I remember it being!  (Were we starting to see couches through beer goggles after 2 failed attempts?)  I shocked the pants off Matt when I said "let's just take one home tonight!".   He looked at me as though we'd met for the first time, and he wanted to know who this person was that was making such spontaneous and definitive decisions.  I was so determined to get a couch, that I was even basing choices on stock.  I said "we'll get the Sivik Dark Grey, but if they don't have that, we'll get the red".  And while we were debating between an L-shaped and a chaise option, we chose the chaise, mainly because it was in stock, whereas the L-shaped would require 10 days of ordering time.

Of course, we’d gone there with no intentions of actually buying a couch.  So when we got to the stockroom and looked at the boxes, we realized another flaw in our plan – how would we get them home?  We called Matt's Dad, and at 8:30 pm on a Tuesday night, that generous, very understanding, and patient man showed up with his van to help us drive the boxes home.  We were so thrilled to have a couch that comes in pieces!  It fit, it fit!  We had it assembled by midnight!

At some point, maybe we'll stain the legs to match the ottoman?
 It's hard to tell in the picture, but this bad boy is a long one, and actually works out to be a bit bigger than the one that got away.  The upholstery is a great grey-ish colour that remind me more of denim, and is perfectly suited to the grey walls and brown ottoman, and is masculine enough for Matt!  It's also significantly less expensive than the last one, AND - it's washable!   Amen to Ikea!

Friday, September 17, 2010

The couch

So during the move, everything went according to plan, with one small exception:  Matt's couch.  One of the things we loved about this house is that there is a living room on the main level where my condo-sized couch would be ideal, and then a large TV room in the basement where Matt's longer, leather couch would be nice.  However... the couch would not fit down the stairs.  No matter which way we turned it, squished it, pushed it, pulled it.   It just wasn't going.  The guys even wrapped it in bubble wrap so that they could really try shoving it.  But logistically, it was just impossible.  So after taking doors off hinges, and light fixtures off the ceiling, the couch was sent back outside, and now resides in the garage.

We took this as an opportunity to get a sectional, which will be ideal for TV watching!  And maybe for some foot rubs too!  For the sectional we chose, our only choices were black upholstery or brown, and I went  to the showroom fully expecting to pick the black, since the online image of the brown was quite a chocolate-y colour, and not really our taste.  The only loophole is that Matt had an ottoman with his couch, which he desperately wants to keep, as it holds all his DVDs and cables and remotes and video games.   And quite frankly, I don't think any of that stuff needs to be displayed on a shelf, so I'd be happy to keep the ottoman too.  It has an insane amount of storage space; but it's dark brown leather.  I thought  that maybe we could get the black couch, and then I could make some cushions with a fabric that has both brown and black in it, to tie it all  together?  Anyway, when we got to the store, I saw the brown swatch, and realized it wasn't nearly as chocolate-y as I  thought it would be, and might actually look quite nice with the brown ottoman.  But I still wasn't sold on brown fabric.  The basement walls are a light grey, and the carpet is also grey, so the black matches with that better.  However, the black is so crisp that it would probably show every little mark of dirt, while the brown might hide spots better.  I deliberated and deliberated and I think I caused Matt a serious headache.  And in the end, I told him that the decision is up to him, because I really just couldn't let go of one colour over the other.  So - he chose black, reasoning that it was my gut instinct before we even got there.

The new one arrives tomorrow.  I have measured this thing to death, I taped out the area in the TV room to see how it will feel, and I measured the stairwell, landing, doorways, and every angle I could think of.  PLEASE let me have not screwed that up!!

We also ordered this desk chair while we were there.  I'm pretty smitten' with it.

I am very excited for the delivery tomorrow!

Thursday, September 16, 2010

On being a homeowner.

So I promised a post on my new experiences as a homeowner, and here it is!  (For the record, I've been a "homeowner" for 5 years now, but I guess what I'm really referring to, is my new experiences as a "house-owner").

First, just a few things we've had to deal with so far:
  • The bed broke at 11 pm one night as Matt was getting into it, so we adjusted it; then, at 4 am, the bed broke again when Matt got up to go to the bathroom.  We adjusted it.  The bed continued to break night after night until Matt's Dad stepped in and helped fix it properly.  Fingers crossed for some restful nights here on in?
  • Fridge died - I woke up on Monday thinking that our house was on fire, and was sure the smell in my nose was smouldering or electrical, or some huge disaster, and definitely worthy of calling 911.  Matt's reasoning prevailed, and convinced me maybe it was a dead animal in the attic or chimney?  When I got home late Monday evening, and discovered everything in the freezer was thawed, I realized the true source of the smell - a burnt-out fridge.  Like the truly determined new homeowner that I am, I googled the death out of that fridge, and tried everything I could.  And in the end, both of the repair guys I called gave me the same prognosis I had determined myself: compressor is done, buy a new fridge!  Delivery this Friday... more on that some other day!
  • Sprayed a bee hive

And a few things I've learned:
  • Grass grows fast and lawns require mowing on a regular basis.  And to quantify that, regular means ONCE A WEEK?!
  • Claw-foot tubs require TWO shower curtains for full coverage, otherwise, water everywhere.  Duly noted.
  • The outside hose on the west side of house leaks into the guest room.
  • Our beautiful, huge tree in our backyard leaves mini helicopters EVERYWHERE.... in the bedroom, bathroom, kitchen, all over the car windshield... I even found one in my bag at the cottage on a recent weekend trip.
  • How to plunge a toilet - and that some plungers are better than others.
  • That I would ever accept a new plunger as a warmly received gift (thanks Dad!)
  • That I can see straight into the kitchen of the neighbours' house from the shower(!!)
  • That the previous owners preferred Rogers to Bell, and in the process of renovating, removed every single phone jack and telephone wire from the house.  That was a fun surprise when Bell came to install our services.
  • That Matt will inevitably bang his head on the ductwork every single time he enters the furnace room.
  • That our doorbell will ring when someone is at the door of the house across the street

I feel like we are going to learn something new for every single day we live in this house, and that both excites and terrifies me - since a lot of what we will learn are lessons we find out the hard way!  While the house is in very good shape overall, I know that every house is full of surprises, and nothing is exactly as it seems.

Matt keeping up with the mowing... at night
Matt keeping up with the mowing....  at night....

I realized after yesterday's post, that I never mentioned how the move itself went.  We have amazingly supportive families, along with a great group of friends, and the amount of help we received that weekend is beyond words.  We knew that the Gardiner Expressway was going to be closed all weekend, and that the majority of Saturday could be spent stuck in traffic.  So on the Friday night, Matt and his family loaded all his stuff into the truck (while I worked on last-minute packing at the condo with my Mom).  That way, the moving truck was already half full by the time it arrived to the condo at 9 am on the Saturday.  Matt friends and my brother loaded all my stuff in very quickly, and we were on the road and into the gridlock by about 11 am.  We were at the new house and unloaded by about 1:00 pm, and were able to sit down for a great big lunch in the new backyard!  The boys had definitely worked for it!  Everyone kept commenting that it was insane how much stuff I managed to have, considering the size of my condo.  Let's just say I was pretty good at creative storage!!

All packed and ready to go!
All packed and ready to go!
 A wise person I know had warned me before that move, that in EVERY move, at least ONE thing breaks, so I should just relax and enjoy the day and hope that the one thing was nothing major.  Well, our one thing was Matt's Tobi steamer.  And while I was looking forward to wrinkle-free clothes, I am perfectly okay with that being our one thing!

I owe  a HUGE thank you to all of our family and friends who helped with this move, whether it be the heavy lifting, the packing, the unpacking, hanging mirrors and shelves and hanging rods, putting furniture back together, the cleaning/scrubbing/dusting/soaking (my Aunt, cousin, and Mom must have had prune hands by the end), providing lunch and patio furniture to enjoy the lunch on, etc.  Any contribution was GLADLY accepted.  We also had many drop-in visitors throughout the weekend, and while our house was in less than presentable shape, it was so nice to have so many family members and friends eager to share in our excitement.  You are all welcome any time!

Wednesday, September 15, 2010

The First Post-Move Post!

Okay, I know, I have been a VERY negligent blogger!  I have been so overstimulated by the move, that I wouldn't even know where to begin with blog posts over the past few weeks.  Such an eventful few weeks.  I will try to give a very quick summary of the goings-on, and the hopefully get back into the full swing of things over the coming days!

Tenant: Well, after the last post I thought the couple would take the place for sure. We communicated back and forth many times, and I sent them the lease application.  Then, after about 4 days of vague emails from them, they told me they had learned that they can stay in their current place after all, and thus, I was back to square one.  Keep in mind, that at that point I was 3 days away from closing on the new house, and was now buried in boxes and newspaper and bubble wrap.  There was nothing nice about the appearance of the condo.  I decided I had no choice but to keep packing, and would have to do any future showings with an empty condo.  It wasn't ideal in my opinion; because of the size of the condo, I felt basic furniture is necessary to illustrate what fits and how spacious it can actually feel.  Anyway, as luck would have it, a few days after officially moving out, another potential tenant asked to see it, and when I said "I'm sorry, it feels a bit sad since it's empty", the prospective tenant responded with "I see it as opportunity".  Hooray, it's leased!!  The references have been checked, the papers signed, and the deposit is in the bank.

New house: I LOVE our new house.  I mean I really, really admire it!  Most days, I find myself telling Matt how much I love it.  Once, I caught him sitting on the couch in the living room, and just looking around taking it all in, and he said "our house is HUGE!".  Now, I have to tell you - this is just a tiny little 2-bedroom bungalow, with a very simple layout.  But in comparison to the condos we were living in, we've got places to eat, a whole room in the basement just dedicated to TV watching, a "guest room" (room in the basement big enough for a bed), an office, a storage room, a tool area, and a whole laundry area with space to put up an ironing board and a drying rack (no stackable washer/dryer for us anymore!).  Add to that a (somewhat rickety, but still invaluable) garage, a driveway long enough for at least 3 cars, and a very spacious backyard, and we are in heaven!!!!  And all just a few minutes from downtown!  I can still take the streetcar to work and now I actually get a seat.

Condo: Tomorrow night I am having the condo painted with an eggshell finish (rather than the flat builders' paint that I've had on the walls since I moved in.... you'd think I would have chosen something nicer after 5 years?), so that it can be wiped and cleaned easier.  We could have painted it ourselves, but  as far as I understand, this cost can be written off, and I am SO happy to not have to worry about edging and taping, and the stress I cause myself by not being as good of a painter as I wish I was!

I've got tons more I can update on, but I will ease back into it.  I can't even begin to summarize all that I've already learned as a homeowner, so I'll save that for it's own post, tomorrow!