News
The Effects of HST
June 8th, 2010July 1st is Approaching Quickly!
Nineteen years after the implementation of GST, we are now entering a new era – HST. In Ontario, as of July 1st, 2010, this “harmonized sales tax” will be a combination of the 8% provincial sales tax and the 5% GST, resulting in a 13% tax. But how much will this “new” tax actually affect us?
Most goods are already subject to both PST and GST. These items will not be affected by HST. Where HST will hit us the most is on services that we currently only pay GST on. Some of the areas that we currently pay 5% tax on that will be changed to 13% include: electricity and heating, internet access, services from a contractor, air, bus and rail travel, gasoline, gym memberships, golf green fees, children’s lessons (with the exception of music lessons), haircuts, funeral services, legal fees, new homes over $400,000 and real estate commissions. (For a full list of what is affected and what is not, refer to: http://www.rev.gov.on.ca/en/taxchange/pdf/taxable.pdf .)
Note that resale homes will not be subject to HST. Where you will experience HST in a residential real estate transaction is on the services associated with it: legal fees, appraisal fees, home inspection fees, moving costs, high ratio mortgage insurance premiums and real estate commissions.
Impact of HST on the Sale of a Home
Example 1: Between January 1st , 2010 and May 31st, 2010, the average sale price for a resale home in Milton was $390,000. The table below indicates the additional costs that you would pay on the sale of a home with the price of $390,000. The implementation of HST will result in $2,219.84 of additional taxes. (This works out to be 0.57% of your original purchase price.)
| Cost (Before Tax) | Current Tax Paid | Total New Tax Paid | Difference | |
|
Mortgage Insurance Premium(1) |
$10,188.75 | $815.10(2) | $1,324.54 | $509.44 |
|
Legal Fees |
$1,000.00 | $50.00 | $80.00 | $30.00 |
|
Real Estate Commission(3) |
$19,500.00 | $975.00 | $2,535.00 | $1,560.00 |
|
Home Inspection Fees |
$400.00 | $20.00 | $52.00 | $32.00 |
|
Title Insurance |
$480.00 | $24.00 | $62.40 | $38.40 |
|
Total |
$31,568.75 |
$1,884.10 | $4,103.94 | $2,219.84 |
Notes:
(1) CMHC premium of 2.75% for a mortgage with a 5% down payment on a $390,000 home.
(2) Currently only PST is paid on high ratio mortgage insurance premiums.
(3) Based on 5% real estate commission.
Example 2: The average sale price for a home in rural Milton between January 1st, 2010 and May 31st, 2010 was $808,000. The table below indicates the additional costs that you would pay on the sale of a home with the price of $808,000. The implementation of HST will result in $4,437.85 of additional taxes. (This works out to be 0.55% of your original purchase price.)
| Cost (Before Tax) | Current Tax Paid | Total New Tax Paid | Difference | |
|
Mortgage Insurance Premium(1) |
$21,109.00 | $1,688.72(2) | $2,744.17 | $1,055.45 |
|
Legal Fees |
$1,000.00 | $50.00 | $80.00 | $30.00 |
|
Real Estate Commission(3) |
$40,400.00 | $2,020.00 | $5,252.00 | $3,232.00 |
|
Home Inspection Fees |
$400.00 | $20.00 | $52.00 | $32.00 |
|
Title Insurance |
$480.00 | $24.00 | $62.40 | $38.40 |
|
Total |
$63,389.00 | $3,802.72 | $8,240.57 | $4,437.85 |
Notes:
(1) CMHC premium of 2.75% for a mortgage with a 5% down payment on a $808,000 home.
(2) Currently only PST is paid on high ratio mortgage insurance premiums.
(3) Based on 5% real estate commission.
Is the sale of your home subject to HST?
If you have a firm deal in place for the sale of your home prior to July 1st, 2010, then you are only required to pay GST on your real estate commissions. (This is because 90% or more of the agent’s services were completed before the implementation of HST.) Note that the closing date of your home need not be prior to July 1st to avoid HST on real estate commissions! However, other fees (mortgage insurance premium, legal fees, etc.) will be subject to HST if the service occurs after July 1st.
Royal LePage Shelter Foundation Garage Sale!
May 14th, 2010
Tomorrow there is a garage sale that is happening all across Canada. Many of the Royal LePage offices are opening their doors (and parking lots) to people to come and buy something with the knowledge that all of the money raised will be going to support local women’s shelters.
Royal LePage Meadowtowne Realty is no different. Our brokerage is having a RLP Shelter Garage Sale at all 3 of our locations (Milton, Mississauga and Georgetown).
Please choose one (or all 3) and come out (and buy something) to support a great cause.
Check out the video below.
The Affordability Verdict.
May 3rd, 2010Here is an excerpt from an article by Dan Richards, CTV.ca.
“The affordability verdict
If mortgage rates in December had been at normal levels, the percentage of income to carry a house in most cities would have been well above its long-term average. The good news: In most cities those percentages would still have been well below their highs – prices may be a bit elevated but this doesn’t suggest a bubble or a big drop ahead.”
To read the whole article, please click here to visit the CTV.ca website Housing affordability: the great quandary
Ontario Provincial Government says “No Quarry”!!!!
April 13th, 2010Ontario Provincial Government says “No Quarry”!!!!
THIS IS BIG NEWS!!!!! The Ontario Government has legislated that there will be NO QUARRY!!! Residents of Rural Hamilton (Formerly Flamborough, including Carlisle, Freelton and Waterdown) and Kilbride and all the surrounding areas should (will) be ecstatic.
For six years we have been having to explain, educate and inform the public and prospective buyers and sellers (and their Realtors) of the implications that a quarry would have on property values and sales for LOTS of people (not just those who are immediate neighbours of the proposed site west of Milton, Ontario).
Please go to the StopTheQuarry.ca website to find more details of the Six year fight and the breaking news story of it’s victorious conclusion.
CONGRATULATIONS to F.O.R.C.E.!!!
Check out some of the news stories:
From the Spec – http://bit.ly/95UShW
FINAL FORCE Release April 13 2010
McMeekin Press Release, April 13, 2010
SOLD!!!
April 9th, 2010I was on the listing representation end of multiple offers tonight.
884 Maple Ave. in Dorset Park (Milton) received 4 offers tonight. One clear standout was signed back with minor “house-keeping” changes. The “signback” was accepted by the buyer and the property is now SOLD (conditionally for now).
The sellers took two weeks after our initial visit to do ALL the things our wonderful stager/decorator told them to do (6 pages of tasks) and the sale price is a testimony to the hard work and strong attitude that was embraced by the sellers. The property came on the market properly with a splash and the sellers are ecstatic with the result.
Another living example of how to sell your house quickly for the best dollar possible.
Organizational Announcement
March 17th, 2010It is with mixed emotions that I announce that as of March 9, 2010, Kim Coulter has left The Brazeau Team to go back out on her own as a Sales Representative with Royal LePage Meadowtowne Realty. Kim will however be staying with our Brokerage as part of the Milton office. I’d like to take this opportunity to thank Kim for her commitment and contributions over the past 15 months. Please join me in wishing Kim every success in her future real estate endeavours.
Regards,
Joseph
Family Day activities in Milton, Ontario
February 9th, 2010
Milton is a wonderful family community to live in with lots of things to do and recreational type places to visit. In honour of Family Day, the Town of Milton has put together a schedule of “olympic themed” activities that you can enjoy with your family. Please download the full details here.
What makes a story worthy of being on the front page?
January 17th, 2010If you take a look at the front page of today’s Toronto Star, you will see a story regarding mob justice in Haiti. This is, in my opinion, worthy of the front page. However, if you look to the left of this, you will see a story about me (and about 24,999 others) who were all awaken early Saturday morning by an automated phone message from the Halton District School Board. Seriously… front page?!? Sgt. John Faught, who was the 139th Canadian soldier to be killed in Afghanastan , made page 3. For some reason, 25,000 Halton residents getting a 5 a.m. wakeup call takes priority over a brave man who served his country with honour.
I really hope that my comments in both the Toronto Star and the Toronto Sun truly conveyed how I feel: It was no big deal. Yes, at first I thought that there was bad news on the other end of the phone when it rang at that hour, but after a quick chuckle, I rolled over and went back to sleep. Little did I realize the media frenzy that it would create!
To the woman from the Halton District School Board that was responsible for the fiasco, I say congratulations! Not many of us can make a simple mistake on the job and have it so widely publicized. It is quite easy for people who are already in the public eye to have their simple gaffes blown out of proportion, as the paparazzi are all sitting waiting for them to screw up. But to make the front page of a major newspaper without already being famous and when there are many other newsworthy events occurring, that is an accomplishment! I hope that you (and the school board) are able to laugh at your mistake, hold your chin high and point to the story and say, “That was me!” We all make mistakes. And I am sure that you were not able to roll over and go back to sleep after you received the early morning call.
The automated service provided by the Halton District School board serves more good than harm. If the service saves me from sitting in front of the radio waiting to see if my children’s school is closed for a snow day, I am all for it.
I think that the Star owes the family of Sgt. John Faught an apology, for he truly deserved the front page over the many tired parents of children in the Halton school board.
Jodie Near
2009 Holiday Celebration
December 18th, 2009On Sunday, December 6th, the Brazeau team hosted a holiday celebration for our clients at Glencairn Golf Course. It was great to see and reconnect with so many clients! There was a tasty spread of food that ranged from fancy cheeses and sandwiches to an assortment of desserts (my personal favourite was the caramel apple crumble pie…mmm!) The children who attended the event had a chance to enter a colouring contest in the “Santa’s Workshop” area, where they also enjoyed an endless loop of Christmas movies (Shrek the Halls was on the screen at least 3 times!). Jason and Rebecca from StreeterStevens Photography were on hand to capture the event, as well as to take family portraits. From the photos that I have seen, it appears that everyone had a good time!
The event also honoured Virginia Brazeau as she celebrates 20 years of service with Royal LePage. Her very first client Ruth Lawrence was at the event to personally congratulate her. Joseph teared up as he said some very kind words about his mother. Alex Ocsai and Gloria Riddall , the Royal LePage Meadowtowne Broker/Owners and Catherine Fox, the Broker/Manager of the Milton office, had thoughtful words of their own to add.
On a personal note, I have had the privilege of not only working with Virginia for the past five years, but also learning from her. I truly admire her “mothering” approach to real estate. She knows when to push you to make the right decision, yet she will be the first to comfort you when the going gets tough. Her hard work and dedication have made Virginia a highly respected figure in the real estate business. There have been a few negotiations that I have gone into where the other agent has said, “Oh, you work with Virginia? She is such a good woman.” And as a result, the negotiations seem to go very smoothly! Virginia, thank you for having faith in me and giving me the opportunity to join your real estate family. Congratulations on twenty years of service to your community with Royal LePage!
On behalf of the Brazeau Team, I would like to thank all of our clients for giving us the opportunity to serve you. I look forward to seeing you all at the holiday celebration next year!
Grant Thornton on HST
December 14th, 2009The 2009 Ontario Budget proposed a single, value-added sales tax, which is intended to come into effect on July 1, 2010. One industry that will be significantly impacted by this new measure is the housing industry. This release discusses additional details provided in the information notice published by the Ontario government on November 19, 2009 (“Bulletin”).
Ontario HST and the housing industry (187.9 KiB, 164 hits)
