How HST Will Impact Real Estate in Chatham-Kent

It’s been the talk of the town for a while now, but how exactly will HST impact Chatham-Kent residents in the coming months? It’s a good question, and surprisingly, when it comes to selling or buying a home in Chatham-Kent, the answer is relatively easy.

So just how will HST, the Harmonized Sales Tax, impact the home buying process? The Chatham-Kent real estate market has been strong in recent months, and HST should not severely change this trend. There are however, a few things home owners around Chatham-Kent should know about the new tax law. Here are three ways HST will change the Chatham-Kent real estate market:

  • HST on resale homes: For Chatham-Kent home buyers searching for a previously owned home, you won’t end up paying a single cent more. That’s right, you’ll be paying the same price under HST as you would have in the days of GST and PST. Resale homes are exempt from HST. When naysayers tell you horror stories about the tens of thousands of dollars you’ll be losing as a homebuyer under HST, don’t listen, the rumours are false.
  • Selling your home: As you prepare to sell your home in the coming months or years, HST will change a few things. First, HST is only applicable on items including real estate agent commissions, lawyers’ fees, and other services. For example, if you are selling a $200,000 home and the real estate commission is 5%, HST will cost you an additional $800. For most families in Chatham-Kent, $800 is not a small amount. In the grand scheme of the home selling process however, $800 is very little. Sellers can lose $800 from an offer price by not maintaining their lawn, having cluttered rooms, or not thoroughly cleaning their home before an open house.
  • Buying a new build: When it comes to the Harmonized Sales Tax, the largest impact to the real Chatham-Kent estate market will be in new builds. HST will be applied to the entire value, including real estate and other services, of a new build home. This means, if you purchase a $200,000 new build home, you’ll be taxed on the entire $200,000. There are, however, rebates available for home buyers that will minimize, and potentially eliminate this burden. Chatham-Kent residents purchasing a new home will be eligible for a $24,000 tax rebate. This rebate applies to all homes, regardless of the purchase price. This means, for those purchasing a home worth up to $400,000, you will end up paying no more, or in some cases less, than you would have under the old tax laws.

Although there will be changes under the new Harmonized Sales Tax (HST), the impact on those selling or buying a home in Chatham-Kent will be minimal. Buying a property or piece of real estate in Chatham-Kent is a great investment. The many small communities in CK offer outstanding amenities, opportunities, and a variety of welcoming features, and HST will not change this.

If you still have questions about HST, feel free to contact Patrick at 519-354-5470 or 519-360-0141.