HST Tax Concerns

2009/09/04 Originally published in the Vernon Morning Star.

I seldom tackle any topic that concerns itself with anything political. But this time I feel I must speak out.

Prices of Okanagan real estate are such that a great number of our home sales are over four hundred thousand dollars. The significance of that is that four hundred thousand dollars is the breaking point at which the HST rebate diminishes so much that it saves the buyer very little money.

If this new Harmonized Sales Tax is to become reality the cost of buying new housing will be artificially raised by seven per cent. On an average new home in our area over $500,000 that could well translate into a twenty thousand dollar or more added cost.

So, I think it is sure to hurt new home sales. If that happens, sales of building products drop off and many subtrade jobs are lost. How can that be good?! Over time, I believe this new tax will push prices down on new housing by the amount of this new tax. The consumer makes zero saving on this though, because they have to suffer paying the new tax. As a result of this, builders have lower profit and if builders are not making profit they'll build fewer homes. This again will result in less buying of building products and subtrade jobs dying off.

I don't see how we can stand by and let this happen. So far, this is in the proposal stage. It's not too late to act for us. Please send letters to our local MLA - Eric Foster, Premier Gordon Campbell and Colin Hansen our Minister of Finance.

Lets' speak out this time!

More information is also available on the B.C. Real Estate Association at www.bcrea.bc.ca/hst/hstaction.htm
I do believe that Okanagan real estate will always be a sought after commodity, no matter what taxes come and go. I just can't support any political move that doesn't enhance this fact.
Our real estate marketplace is just beginning to return to a normal, healthy climate again. Let's try to keep it that way.

Jane Field works with RE/MAX Vernon. Jane has over 30 years experience in the Real Estate business. To suggest topics for future articles or to ask Jane questions, email her or call 503-3755.

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