Book to help investors make smart decisions
August 7, 2010 Kathy McCormick, Calgary Herald
A real estate expert has written a book aimed at helping Canadians recognize opportunity in the midst of housing bubbles and changing regulations.
Don Campbell co-wrote 81 Financial and Tax Tips for the Canadian Real Estate Investor to help people maximize revenue and reduce taxes.
The book offers insights into the limitations, requirements and benefits of the Canadian tax system.
"It's not about how much you make, which is for your ego," says Campbell, who is president of the Real Estate Investment Network (REIN). "It's about how much you keep for wealth creation."
As tip No. 53 in his new book says: "Capital gain and income are not the same thing."
The advice comes with a warning.
"Many novice real estate investors assume a capital gain always results when they sell properties. Reality tells a different tale -- and an inappropriate tax-filing position can trigger an expensive tax problem."
If you are going to buy three or more pieces of real estate, "make sure you have an accountant who has real estate experience," says Campbell. "Don't do your own taxes -- not because you aren't an accountant, but because things change so fast."
Some other tips from Campbell:
-Never throw out a receipt, "ever," says Campbell. "It can mean money for you. If you don't have a receipt, the expense will be disallowed."
-For homeowners, "every Calgarian should pull their own credit history at least once a year," he writes. "It protects you from fraudulent transactions and affects your ability to operate in today's society."
-Before you buy a resort, "go twice -- once in the low season and once in the high season to make sure it's somewhere you will want to own for 12 months." And do your own homework -- "not a realtor's homework," says Campbell. "They obviously want you to buy," says Campbell.
-Buy your own home first before you start investing in other property. "Every dollar you make is tax-free."
-If you are buying to live, rather than as an investment, "look at buying in a region where you will be comfortable living," says Campbell.
-The number-one tip: "I give this to everybody and it's ironic -- never invest based on tips," Campbell says, laughing. "But use the tips to enhance your investment strategy."
The book, 81 Financial and Tax Tip, is Campbell's fourth one offering real estate advice.
All of Campbell's royalties from the book go directly to Habitat for Humanity, he says.
Together with the REIN group, Campbell has raised more than $524,000 to build homes for those in need.