HST to hurt 2010 mortgage market

HST to hurt 2010 mortgage market

An overwhelming majority of members from the Mortgage Brokers Association of B.C. (MBABC) feel that that the HST will negatively affect the 2010 mortgage market.

"It is evident that our membership feel the HST will take a toll on the real estate industry, particularly for new home buyers", said Joe Santos, president, MBABC, in a statement. 

Despite continuing low interest rates, 75 per cent of respondents felt the HST would have an overall negative effect, with 25 per cent of those saying there will be a negative impact only at first, with a minor one thereafter.

One area in particular concerns the sale of homes over $500,000.

"A $500,000 sale typically generates a commission of approximately $19,000. The HST will add an additional $1,330 in tax", said Santos. "This affects home sellers perhaps to an even higher degree because the HST will be added to real estate commissions." 

He added that this may force first time homebuyers, the "main driver[s] in the housing industry," to make less expensive purchases due to the higher transaction costs.


 

3 Comments
  • Sal Vetro 2009-12-10 2:39:58 AM
    Is there anybody that can escape the wrath of the HST Police. Who's next in line to receive a 7% boost in taxes. Does this government not understand that the more money, you take out of Joe Average citizen's pockets, the more likely he is going to watch every nickel that goes out, thus causing the economy to head into catastrophic consequences creating two distinct classes in our society. The very rich and the very poor. There won't be any more middle class. There is hope. A light at the end of the tunnel. Here's my suggestion. Ordinary British Columbians and all small to medium sized businesses must get involved and get behind Bill Vander Zalm Leader of the Fight HST team, of which I am proud to say, one of the main organizers. Please visit www.fighthst.com, leave your comments, volunteer, donate if you can still afford to, and you can also post any comments you may have. The battle has just begun. Remember you can make a difference. All you have to do is try. Together we will win, cause the people have had enough and want to take back control of their government.
    Post a reply
  • Dan P 2009-12-11 2:31:16 AM
    The HST will no doubt be a nuisance to all that need to pay it but will it really impact the RE market? Buyers and Sellers certainly will not welcome the higher tax costs but will put up with it anyway because Sellers want to sell and Buyers want to buy. I predict very little negative impact on the market from the new tax structure but do predict a big surge in teeth gnashing.
    Post a reply
  • Michael Lloyd 2009-12-11 5:20:38 AM
    While the HST will cause some discomfort, it will come and people will deal with it. What people like Sal seem to forget is The government has to pay for all the services we insist on somehow, it doesn't just grow on trees. Something Mr. Vander Zalm knows, but in his never ending quest for any kind of power. Sal, we have control of the government, if you don't like it, vote them out in 3 years.
    Post a reply