The government of Ontario announced that starting on July 1 2010 there will be a new harmonized sales tax structure. Currently we have a Federal (GST) tax of 5% and a Provincial tax (PST) of 8% and these will be combined to create an HST tax of 13%. What does this mean to a homeowner or someone considering home-ownership. Short answer PLENTY!Here’s a sample of items that will impact the real estate world
- mortgage insurance premiums
- real estate commission’s
- home inspections
- title insurance
- lawyers fees
- appraisal fees
- new home purchase (over 500,000 will be severely impacted)
- general living costs
I suspect it will be an interesting real estate market a year from now as buyers and sellers look to make a move before this new tax burden applies. (still not clear on all details i.e. what if builder misses target date and closing is post July 1? ) Imagine buying a new home for $800,000 (not a stretch in Toronto!) and paying an additional $40,000.00 Ouch!Its been said that ‘real estate makes the world go around’. When someone purchases a home they feed the economy with appliance and furniture purchases, carpeting, painting, landscaping and numerous renovation projects that stimulate the economy and provide much needed employment. Now an additional tax that will effect an industry that is the essence of a healthy eccomomy……. big OUCH!
Comments on this entry are closed.