Real estate representatives say now is not the time for an increase
TRURO - Local homebuyers may soon have to pay twice as much for a deed transfer tax.
"This could be the straw that breaks the camel's back," Todlynn MacPherson, associate broker at Royal LePage Truro Real Estate, said in a news release. "With already increased tax rates and assessments ... our fear is that many new buyers will not be able to buy their first home as planned."
Both Colchester County and the Town of Truro are proposing to double the deed transfer tax charged to homebuyers from 0.5 to one per cent.
The tax applies to all types of property
On an average home purchase of $150,000, the deed transfer tax would be $1,500 with the proposed new increase. The tax would be paid in cash on closing and could not be added into a mortgage amount.
County council will publicly vote on the issue April 30 while the town debates the issue publicly May 4.
"Both assessments and municipal tax rate increases have already been passed for this year and now is not the time to double this tax as well," said Sharon Corcoran, broker of ReMax Fairlane Realty.
Dave Uloth, Prudential Woods Realty broker, also questioned the short notice of the increase.
"... many homebuyers who have set aside their savings for a home purchase this year may have to delay their home-buying decision."
"An increase will make this area less attractive to buyers relocated to the area," added Anne Ireland of Century 21 Market Realty.
Colchester County Mayor Bob Taylor said the revenue from the proposed increase is needed to further development in the county.
"People should understand we are very pro development and we need money to make those things happen ... without increasing taxes further," said Taylor.
"It seems reasonable and the logical place to go (for revenue)."
Taylor added Halifax and East Hants are two of the "fastest growing communities" and their rate is 1.5 per cent.
Truro Mayor Bill Mills said town council will have a "full debate" during the second reading of the topic on May 4.
"I've talked with (Mayor Taylor) about the pros and cons" of the proposed tax, said Mills, without commenting on his opinion of the proposal.
The Nova Scotia Association of Realtors (NSAR) indicates the northern Nova Scotia real estate activity in March was down 28 per cent over last March; the largest year-over-year drop across the province.
"It is difficult to justify an increase in the tax when the housing market in the area is seeing a decrease in activity," said NSAR's Linda Smardon.