HST will add thousands to real estate costs

Harmonized sales tax! Go away before you even get here!

Take a stand, talk to local government about stopping this extra tax!

Running shoes and bikes are exempt! Fight for you real estate investments and homes.

As of July 1st 2010 the liberal governement has proposed a harmonized sales tax (HST). An extra 7% will be added to new homes and on all the services associated with purchasing or renovating real estate.

This new tax will affect new construction sales!

An average home at $505,000 HST would add $15,400, after the rebate. Keep in mind the big dollars are affecting the new construction. New construction is a big part of Penticton's economy. If you are buying residential used homes the HST would be applicable on the following services and any renovatons.

                                                  now         after July 1 2010

Real Estate Commissions                5%                   12%

Property Inspections                       5%                    12%

Appraisal                                      5%                     12%

Survey Certificate                         5%                        12%

Lawyer or Notaries                         5%                        12%

Costs of clearing title                   5%                          12%

What about owner occupier rebates? The government has proposed rebating homes up to $400,000 and capping the rebate at $20,000.

- The current GST rules - new construction is taxed while used housing is not. That will continue under the new tax system. The GST is currently 5% and has a variety of partial rebates for housing up to $450,000 to a maximum of $7,560. For housing over that amount the full 5% applies.  

- Currently half of new housing in urban B.C. is sold for over $400,000. Half the buyers will be affected ... period.

- Landlords, builders and homeowners will have increased costs on expenses for management, maintenance, repairs, electricity and gas/cable.

- It will benefit all construction that can finish and deliver title before the July 2010 deadline. Buyers will look to used homes after July 1, 2010. They will struggle to avoid the extra $100,000 in taxes on the average new home in Vancouver (12% - $20,000 rebate) and will buy USED! It will drag buyers from the future into today ... and then after July next year, buyers will be harder to find.

Bottom Line: If you are thinking of buying a new home, do it before July 1 2010!

There will be additional costs to apartment building owners with the extra 7%for yard and building maintenance, caretaking,  hydro, heating and equipment leases. These costs cannot be laid over to tenants because rent increases are under rent control.

BC is already known for taxing homebuyers on the land. Land transfer tax, also known as property purchase tax, or the sunshine tax. First time homebuyers may qualify for an exemption or partial exemption. We are one of the only provinces that has this tax and now they are imposing another!BC is already known for taxing homebuyers on the land. Land transfer tax, also known as property purchase tax, or the sunshine tax. First time homebuyers may qualify for an exemption or partial exemption. We are one of the only provinces that has this tax and now they are imposing another!