Carl Stars

House Prices stay high as Sellers fight to keep them up !! In many of my Blog Posts I always maintained in the past prices will remain high. Also buy a house you love and do not just look at is as an investment . One article today was published in the Hamilton Spectator, which prompted me to write this short blog. A quote from one article in the Spectator was as follows "Sellers stubbornly hold onto their perception of what their home is worth, whereas buyers turn on a dime." In tough economic times Sellers will fight to keep their homes that is for sure. I also have always pointed out in my own view the Canadian Economy is evolving to a " European type of economy" The HST is similar to the VAT ! Houses are expensive and we have to work longer and harder to keep them. Burlington Inventory is at 680 homes including Condos . Simply put inventory's are low and interest rates are still low. The amount of inquiries I have received have doubled in the last two weeks. I am expecting a busy fall market. I will observe Buyers are not as rushed to make an offer and they are actually thinking. This is a welcomed relief !! Carl

The Bank of Canada raised their rate by 1/4% this morning. Bank prime is now at 2.75%.

The Government has commented that inflation is at a predictable rate. The Banking sector remains strong. I took an average of the lender rates emailed to me on a daily/weekly basis and the best five year rate I could find was 4.09 and the best 10 year rate was 5.20 . Fixed rates on five and ten year terms remain very competitive.

As of this morning their is a total of 767 active listings in Burlington. Its good to note a few short months ago we were around 400 if I recall. However staged homes and if priced correctly still result in bidding wars or at least quick sales usually around 98% of asking price.

I have notices Buyers are more cautious and the inventory is a sign of a more balanced market . Already some areas are starting to reflect a buyers market. The fall market will tell the story. Some buyers and Sellers have some HST jitters but the costs are minimal when you look at the size and scope of the transacation. ( But yes the HST is just another tax grab ).

Carl

www.carlstars.com

Yesterday I had the opportunity to "dust of the Day" and enjoy the heat. Here are a few photos from Spencer Smith Park in Burlington and a couple shots of Royal Botannical Gardens in Burlington. It is amazing the beauty right in our own backyard.

HST FEE JULY 1

So many people are asking if there are exceptions to the charge. The HST will be charged on Commisions.

What I can determine is as follows:

• If the deal is firmed up before july 1 and closes after July 1 - 5% gst is charged
• If the deal is 90% done before July 1 , and firms up after that possible 5% depending on what needs to be completed.

• Otherwise anything after July 1 is 13%

$200,000 @ 5% commission is $ 10,000.00 .This is split four ways ( Buyer, Agent, Seller Agent, Buyers Broker, Sellers Broker )

HST would be13% or $ 1300.00 cdn funds.

Please access all government web sites in first HST article. New Homes tend to be a bit more complicated . There is a grandfather clause which I have not covered. This depend on how much of the home is constructed before and after.

HST CONDO FEES YES or NO ?

Thursday, April 8th, 2010 7:15 pm

The HST will not be on Condo Fees. However the unfortunate thing is most of the components of a Condo Fee are made up of services. Landscaping, Maintenance and Repair. As of July 1st These services will have HST 8% which is added to the 5%( GST) . The total tax is 13%. I understand water may not have HST but have not verified this.

So it is safe to say you will see budgets " stretched" and yes Condo Fees will increase by around 5% to 8%. There will be pressure on contractors to lower their prices as well.

So yes there is HST ( sort of ) ,

HST Fact CheckList - Real Estate

I wanted to post some general information on HST. Many people are asking questions so I hope this clears things up.

HST is 13% . It is considered value added Tax.

If you are Selling your home:

Real Estate Agents who normally charge 5% GST on commissions will have to charge 13%. This is regarding resale homes and is on the commission only. This will be on July 1, 2010. There are some exceptions but on a regular resale home. This is the tax that would apply.

If you are buying a Resale home extra costs will be incurred HST will be charged on home inspections, legal services, high ratio mortgage premiums, fire insurance premiums.

OREA estimates the HST will add $1,449 in new taxes to an average resale home costing $302,354. And, OREA claims the HST will add an estimated $262 million in new taxes annually to residential resale real estate transactions.

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RE new Homes: Builders would use the same process they use with regard to GST. The Buyer must qualify for the rebate. ( The new home would be a primary residence ) Clarify your HST before signing on the dotted line and read the fine print.

Under the HST, new homes worth less than $400,000 will qualify for a 6% tax rebate, but new homes worth more than $400,000 will be subject to an additional 8% tax. To explain if a buyer pays $500,000 the net tax would be $ 16,000.00 after receiving the rebate of $ 24,000.00

Here are some helpful Links.

http://www.servicecanada.gc.ca/eng/goc/gst_new_housing.shtml

http://www.fin.gov.on.ca/english/index.html

http://www.rev.gov.on.ca/english/guides/rst/206.html

http://www.cra-arc.gc.ca/tx/bsnss/tpcs/gst-tps/menu-eng.html

All information deemed reliable but not guaranteed. Please seek the advise of your tax professional and contact government agency to clarify your costs. As I deal with residential resales it appears the impact will be minimal. I encourage real estate to be a long term investment. Hope this information helps.

Carl

JUST SOLD 98 % OF ASKING PRICE.

This lovely 4 bedroom 3 level side split is in a quality neighborhood in Stoney Creek, Ontario. The home is well cared for and neat as a pin. Full wheelchair accessible home!! The home has been retrofitted for someone with a disability. Complete main floor living with access to deck. MlS # H 3030167 Priced comptetively at $ 289,000 . A Family could save thousands converting a home to accomodate their needs. Driveway has is double drive and can easily accomodate 4 cars. Also three large tastefully decorated bedrooms on the top floor. This home is larger than it looks . For complete photos please access www.realtor.ca and enter H 3030167.