Survey Finds Toronto Residents Unsure About Harmonized Sales Tax (HST)
Toronto home sales in July of this year fell 34 per cent according to the Toronto Real Estate Board, and a new study by a major Toronto real estate company found that the real estate market decline may be due in part to confusion over the new Harmonized Sales Tax, or HST, that was introduced on July 1st. British Columbia also implemented the HST at the same time and also experienced a decline similar to Ontario in their home sales.
The survey was conducted via e-mail and quizzed realtors about their experience with the HST and their clients.
Almost 44 per cent of realtors felt that the HST was to blame for the calm housing market, while almost 47 per cent said that buyers and sellers seem confused about how the tax works and how it affects real estate transactions. More than half of realtors are also receiving many questions about the tax and how it works. Of these misconceptions, the largest was that the HST applied to all home sales.
The HST only applies to newly-constructed homes, not resale homes. It also applies to services, fees and commissions that are involved in real estate transactions. The majority of the agents surveyed also said that less than 10 per cent of their business was new homes, and only 1.2 per cent of realtors said new homes made up the majority of their transactions.
Rising interest rates was the second-highest answer for why the market has decreased lately, with about 28 per cent of the responses.
Survey Finds Toronto Residents Unsure About Harmonized Sales Tax (HST) is a post from: Toronto Real Estate Updates