There are many factors for homebuyers to consider when purchasing a house these days-particularly in the province of Ontario, where the HST has become a factor over the last several months.
The Ontario Real Estate Association, in partnership with Ontario Revenue Minister Sophia Aggelonitis, have released a video to clarify the rules for those looking to purchase a home and to eliminate confusion around HST as it applies to resale and new home purchases.
The video aims to educate Ontarians that there is no HST on resale homes, maintaining similar taxation rules to those under the old provincial tax. In addition, HST is only applied to the portion of new home purchases above $400,000. For first time homebuyers, a refund of Land Transfer Tax of up to $2,000 is available on resale homes.
Analysts feel that there has been less material impact for consumers than anticipated; there is also a common belief that consumers are not fully aware of how the HST is applied to specific purchases—in particular with home buying.
Also, it is important for homebuyers to know about the Ontario Enhanced New Housing Rebate, which “means that buyers of new homes receive a rebate of up to $24,000 regardless of the price of the new home. Buyers of new homes priced up to $400,000 (about three-quarters of new homes built in Ontario) on average pay no more - and possibly even less - tax than under the previous PST, where sales tax was hidden in the price.”
Speaking exclusively with Propertywire.ca, Steven Fudge, Sales Rep, Bosley R.E. Ltd., Brokerage sees varying levels of impact and awareness of the HST in his Toronto market and says, if anything, taxation of all kinds is forefront on Toronto homebuyers’ minds; "Most of my buyers appear aware that HST is not applicable on resale housing, though I have seen a marked increase in buyers double-checking what all the closing costs are. With the double-whammy of both a provincial and city land transfer tax, buyers are weary of taxation”
"(Also) my downtown homebuyers are typically aware that HST is not applicable on resale housing. They're more frustrated that the new mayor, Rob Ford, isn't eliminating the City's land transfer tax, which was part of his election platform.
Watch the video www.ontario.ca/taxchange or www.youtube.com/oreagr