What the HST means for Home Buyers The cost of real estate transactions will increase on July 1, 2010 with the introduction of the new HST. The people of BC will be particularly affected since our province has some of the highest priced real estate in the country. Approximately 40% of all real estate transactions in BC involve sales priced over $400,000, the original threshold for an HST rebate. On November 18, 2009 the provincial government announced the HST transitional rules on housing which includes a threshold increase from $400,000 to $525,000, moving the threshold to above the median new home price in the province. According to the government news release announcing the transitional rules, the limit was increased due to feedback from consumers and the industry: http://www.bcrea.bc.ca/hst/hstaction.htm
1% Property Purchase Tax*
A successful purchase starts with budgeting for the closing costs. Not only do you have to plan to have enough to pay the lawyer or notary, but the 1% Property purchase tax is a big part of this as well. Most people must pay this tax, although first time homebuyers may be exempt. Check this governement link to see if you are exempt as a first time home buyer: http://www.rev.gov.bc.ca/individuals/Property_Taxes/Property_Transfer_Tax/first_Time_home_buyer.htm OR ...Check this link for your costs if you are not a first time home buyer: http://www.sbr.gov.bc.ca/individuals/Property_Taxes/Property_Transfer_Tax/tax_rates.htm GST New Housing Rebate Program* You may be eligible to claim a rebate for a part of the GST you pay on the purchase price or cost of building your home if: - You buy a new or substantially renovated home (including the land or if you lease the land) from a builder.
- You buy a new mobile home (including a modular home) or a floating home from a builder or vendor.
- You buy a share of capital stock of a co-operative housing corporation.
- You construct or substantially renovate your own home, or carry out a major addition (or hire another person to do so).
- Your home is destroyed in a fire and is subsequently rebuilt.
Details - Resale homes are exempt from the 5% GST.
- New homes are subject to the 5% GST. New home buyers can apply for a rebate of the 5% GST applicable to the purchase price to a maximum of $8,750 for homes costing less than $350,000 before GST.
- For new homes priced between $350,000 and $450,000 before GST, the GST rebate would be reduced proportionately.
- New homes priced at $450,000 or higher (before GST) would not receive a rebate.
The Canadian Home Builders Association offer the following guidelines for home renovations and how the GST is applied. - Renovations done before or after January 1, 2008, but invoiced on or after that date will qualify for the five per cent GST rate.
- For renovations done and invoiced January 1, 2008, but subject to a down payment before January l, six per cent GST will be collected on the down payment and five per cent on the rest of the fee.
- For renovations done after January 1, 2008, but subject to a deposit paid before January 1, the five per cent rate applies. A deposit is not treated as a payment for a supply of goods or services until the supplier applies it against the consideration payable for the supply.
Lender (Appraiser)
A bank is not just a bank. Having the right backer can be extremely important – it is your money we’re talking about after all! Make sure that your lender and financial representative is someone with whom you feel comfortable, and be wary of any lender who promises you more than you think you can reasonably afford. Your lenders may or may not require an independent appraisal, and typically will make arrangements for the appraisal themselves. Also a Mortgage Broker sometimes might just be a good alternative to a bank for financing, but always compare rates first.
Lawyer or Notary
Your home purchase is far too important a transaction to skimp on legal representation at the risk of leaving yourself open to costly future issues. Find a lawyer or notary who is willing to take the time to answer your questions and who specializes in real estate law. Look at these web sites to select a lawyer or notary for your area: http://www.notaries.bc.ca/ and http://www.lawsociety.bc.ca/ Home Inspector
No home inspection is 100% guaranteed, but a few hundred dollars to catch a major problem now is certainly better than many thousands to correct that ‘surprise’ down the road. Take a look at the Canadian Home Inspectors web site for a list of home inspectors in your area: http://www.cahpi.bc.ca/ Contractor
Planning some renovations? You’re not the only one! The home renovation industry is booming, and in some markets, booking a contractor must be done months in advance (that’s a long time to go without a kitchen). Don’t let finding the right contractor slip through the cracks – planning ahead will almost certainly make your renovation smoother, and you contractor will appreciate the advance notice. Not a bad idea to check the Better Business Bureau to see if that contractor has had any complaints laid against them before you hire them: http://www.bbbvan.org/index.php If you need more assistance, please feel free to call on us! ....We are the buying EXPERTS! 604-584-SOLD-7653 or info@fullerservicerealty.com 
We can inform you of new listings first to your e-mail before they hit the public! Mortgage assistance is also available. *The information contained above is deemed to be correct and from reliable sources, however it is advisable to verify if necessary as laws are subject to change.
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