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Basement Finishing and Renovations Has it been 2 years already? Time to work on finishing the basement into some extra living space.


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  #11  
Old 2014-06-24, 10:38 PM
ripcurl ripcurl is offline
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I permitted my basement as well with the city and electrical (ESA). No regrets. Helped ensure it was done right, forced me to learn a bit more, and will have more confidence when I sell.
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  #12  
Old 2014-11-04, 06:19 PM
kalW kalW is offline
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I also permitted my basement with the city and ESA and would do again if I had to.

It's an extra level of checking that can help find issues. Is it perfect? No. I have my electrical main panel and sub-panel worked on by 3 certified electricians and have also gone through 3 ESA inspectors over the last 3 years since we moved in. All of these people missed one (fairly significant) issue that I found myself when doing some work a few months ago. So nobody's perfect. If you can, learn some of the code yourself.

Since I had paid for all these inspections in the past, I spoke to the lead ESA inspector in our city to express my concern that the money I paid for inspections wasn't giving the expected results, and requested that ESA come and redo a full inspection. Obviously something wasn't working right in their process for so many to miss something like this (original builder electrician had bonded neutral and ground in the sub-panel as well as the main panel).

Back on subject: Whenever I hear a DIY homeowner balk at the ~ $200 cost to permit or say it's wasted money, I can't help but think where else they're going to cut corners in their work to save a buck. There's a lot of "I can do that for half the price" DIY mentality out there.

Kal
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Last edited by kalW; 2014-11-04 at 06:21 PM.
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  #13  
Old 2014-11-05, 09:22 AM
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It isn't usually about the $200 you pay for the permit. Most people avoid the permits to avoid the hundreds of dollars extra that they will pay in property taxes each year. That $200 permit can easilly end up costing many thousands of dollars in extra taxes over the life of your home.

That said, I would still get the permits.
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  #14  
Old 2014-11-05, 11:31 AM
WellThatsLovely WellThatsLovely is offline
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Originally Posted by gerapau View Post
It isn't usually about the $200 you pay for the permit. Most people avoid the permits to avoid the hundreds of dollars extra that they will pay in property taxes each year. That $200 permit can easilly end up costing many thousands of dollars in extra taxes over the life of your home.
Yup, exactly this. We looked at a house that was built by a custom builder about 10 years ago on a property that was subdivided and two identical homes were built. Both were for sale for the first time in the same year and looking at both their property assessments from MPAC, one was valued at $400,000 more than the other... we weren't terribly excited that they got permits for things we were going to rip out anyway... over 10 years that would be an extra $50k-$60k because of their $200 permit. Yay.
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  #15  
Old 2014-12-05, 10:05 AM
Halton Home Inspector Halton Home Inspector is offline
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How do we change this mindset?
WE, can't change anything. IMO, MPAC ( Municipal Property Assessment Corporation ) is responsible for most of the confusion about permits and the resulting behaviour when it comes to permits. They have foolishly created an mysterious environment that makes it impossible for people to know if or how much their property taxes will go up after a home owner chooses to go the permit route when finishing their basements.

When a home owner gets municipal permits to do their basement then MPAC gets that permit information and then they decide how much your taxes will go up. If you do not get municipal permits then they obviously don't get any information and there is no re-assessment.

I spoke to MPAC a few weeks ago about this and they seemed ignorantly oblivious that only 1 out of 10 home owners get municipal permits to do basements. Their response was that they have the right to go into homes at any time to check for improvements and re-assess the properly. Then they have the right to charge the current home owner back taxes on the property. This could result in some nasty surprises for people who have purchased homes with finished basements where no permits were taken.

IMO MPAC should have a transparent method for people to calculated how much their taxes will go up after the improvements are made, especially for something as simple as finishing a basement.

For example they could add X dollars to your taxes for every 500 feet of finished space and X dollars if you add a bathroom vs X dollars for a basement powder room. These X dollar amounts should be very low to encourage more people getting permits because if they had a brain they would understand that a few dollars from many people is worth more than a lot of money from very few people.
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Last edited by Halton Home Inspector; 2014-12-05 at 10:55 AM.
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  #16  
Old 2014-12-05, 10:12 AM
kalW kalW is offline
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Originally Posted by Halton Home Inspector View Post
IMO MPAC should have a transparent method for people to calculated how much their taxes will go up after the improvements are made..
But do you really think that people will then use that number to decide whether they should go ahead with the improvement?

I don't think they would. Those that don't want to pay for permits simply won't, regardless of cost. I think it's more of a belief/mindset thing.

Kal
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  #17  
Old 2014-12-05, 11:47 AM
WellThatsLovely WellThatsLovely is offline
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MPAC should stay out of people's homes until they are sold. What business is it of theirs what someone does in their home if they have no intention of selling it? There are thousands of elderly people in Toronto right now starving and freezing to death because they're paying over $1,000/m in property tax for homes they purchased decades ago for less than $50,000.
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  #18  
Old 2014-12-05, 01:25 PM
kalW kalW is offline
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Originally Posted by WellThatsLovely View Post
MPAC should stay out of people's homes until they are sold. What business is it of theirs what someone does in their home if they have no intention of selling it?
The action of selling has nothing to do with how a home is used.

Using your logic, someone could reno their basement to be a second living space for another family to live in (or another family member moving in) but would then not pay any more taxes as they never sold the house. That doesn't make sense.

We pay property taxes to keep the cities we live in running. Generally speaking, the more people that live in a house, the more they use city services, so the more we pay in taxes. Both families should be paying taxes, so audits need to be done whenever there's a change to the house.

Is the system perfect? No, but communities don't seem to have found a better way to do it. (Every community does it more or less the same way).

Kal
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Last edited by kalW; 2014-12-05 at 01:30 PM.
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  #19  
Old 2014-12-05, 01:54 PM
oakvillehomeowner oakvillehomeowner is offline
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Originally Posted by WellThatsLovely View Post
There are thousands of elderly people in Toronto right now starving and freezing to death because they're paying over $1,000/m in property tax for homes they purchased decades ago for less than $50,000.
BULL.

There are very few elderly people in Toronto paying over $12K/year in property taxes. Because Toronto tax rates are much lower than surrounding areas, only those people who are living in a home that was assessed at over $1.65 Million in 2012 are paying $12K/yr. When you consider that MPAC assessments are typically 20% or more below resale value, as a result, the only elderly people freezing to death due to property taxes over $12K/yr are doing it in a house they could sell for $2 Million. I'm not feeling too bad for them...

http://wx.toronto.ca/inter/fin/tax.n...OpenForm&Seq=1
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  #20  
Old 2014-12-05, 01:57 PM
Halton Home Inspector Halton Home Inspector is offline
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Originally Posted by kalW View Post
But do you really think that people will then use that number to decide whether they should go ahead with the improvement?

I don't think they would. Those that don't want to pay for permits simply won't, regardless of cost. I think it's more of a belief/mindset thing.

Kal
Like I said, IMO the price increase should be minimal, and yes, I think there are lots of people who would go with permits if they knew what the costs were up front.
The current MPAC "mystery system" is a failure.
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Last edited by Halton Home Inspector; 2014-12-05 at 04:27 PM.
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