Land transfer taxes

[speedog]

What with the province of Ontario in the news with it's upcoming foreign buyer tax and British Columbia currently having one, I got to thinking about land transfer taxes as one of the news articles I read had mentioned them and I could not recall ever paying a land transfer tax fir any of the properties I've bought in Calgary.

So more searching had me stumble upon this 'land transfer tax calculator' (link) and I was kind of gobsmacked how much home owners pay in land transfer taxes in other provinces.

Thus I have to ask is this something new in other provinces and will Alberta bring such a tax in?

[vid]

"Wait, you own your house????" -Millennial

"I own many houses!" -Born Before 1980

"*dies*" -Millennial

[Architype]

BC Premier Christy Clark said she wanted to get rid of it two years ago, but went on to say "not yet though". LOL.

The tax was brought in by the BC government in 1987 as a measure to control speculation on high end properties.

So, I guess that worked out pretty well then.


There are details in the article, such as; first time owners exempted.

http://www.cbc.ca/news/canada/britis...ints-1.2963133

[lio45]

Originally Posted by speedog

What with the province of Ontario in the news with it's upcoming foreign buyer tax and British Columbia currently having one, I got to thinking about land transfer taxes as one of the news articles I read had mentioned them and I could not recall ever paying a land transfer tax fir any of the properties I've bought in Calgary.

You probably did, you just don't recall it. Every single one of the four jurisdictions I bought stuff in on this continent had some form of transferring fee / stamp / deed / recording fee (name may vary, but it's the same concept). However, sometimes, it may be paid by the seller, not the buyer, it depends what gets agreed upon.

Not in Quebec, though. Quebec is the only case I know (as opposed to the other three) where this tax only gets billed to you later, by your municipality, instead of being part of the closing at the notary's / title company's.

So more searching had me stumble upon this 'land transfer tax calculator' (link) and I was kind of gobsmacked how much home owners pay in land transfer taxes in other provinces.

Ontario + checking the "I'm in Toronto" box is indeed shockingly high. (I thought Quebec was already very high, at ~1% of the purchase price.) I haven't played with the settings / other provinces (except for confirming Alberta is pretty low), is there even worse than that out there?

[Loco101]

Originally Posted by vid

"Wait, you own your house????" -Millennial

"I own many houses!" -Born Before 1980

"*dies*" -Millennial

Not at all the case for younger people in Northern Ontario as you would know!

[lio45]

Originally Posted by vid

"Wait, you own your house????" -Millennial

"I own many houses!" -Born Before 1980

"*dies*" -Millennial

How exactly do you define a millenial? I was born in the 1980s, and own a bunch of property... started in 2005, nearly 12 years ago already.

[esquire]

Ugh. LTT started out as an administrative fee that has morphed into a big cash cow for government. The problem in Manitoba is that the values are still pegged to a 1990s reality when a nice family home was $95,000 and a luxury robber baron abode cost an exorbitant $500,000. It was set on the assumption that sales of $500,000 luxury homes would be rare and that those infrequent wealthy buyers could carry the lions' share of the burden. The problem is that these days, a huge proportion of SFHs and even condos sell at prices that would have been the exclusive domain of luxury dwellings 20 years ago. That leads to these absurdities in Manitoba:

$100,000 home - $400 (OK, fine, cost of doing business)
$200,000 home - $1,650 (why does it cost 4x more to process the transaction of a house only double the value?)
$400,000 home - $5,650 (this is getting stupid)
$600,000 home - $9,650 (gtfo)

It's a significant financial burden for nothing more than the act of buying a home.

[Boris2k7]

Originally Posted by lio45

You probably did, you just don't recall it. Every single one of the four jurisdictions I bought stuff in on this continent had some form of transferring fee / stamp / deed / recording fee (name may vary, but it's the same concept). However, sometimes, it may be paid by the seller, not the buyer, it depends what gets agreed upon.

Not in Quebec, though. Quebec is the only case I know (as opposed to the other three) where this tax only gets billed to you later, by your municipality, instead of being part of the closing at the notary's / title company's.


Ontario + checking the "I'm in Toronto" box is indeed shockingly high. (I thought Quebec was already very high, at ~1% of the purchase price.) I haven't played with the settings / other provinces (except for confirming Alberta is pretty low), is there even worse than that out there?

No, there is no land transfer tax in Alberta. There are fees for land title transfer and registering mortgage on title however.

Land title transfer = $50 + (Purchase Price / $5000)
Mortgage registration fee = $50 + (Mortgage Amount / $5000)

[Jaws]

Originally Posted by Boris2k7

No, there is no land transfer tax in Alberta. There are fees for land title transfer and registering mortgage on title however.

Land title transfer = $50 + (Purchase Price / $5000)
Mortgage registration fee = $50 + (Mortgage Amount / $5000)

As of Jul 1, 2015 there was going to be a land transfer tax brought in by the PCs, but the NDP won the election and it didn't proceed. The only thing the NDs have done that hasn't cost me more money.
http://dbblaw.com/alberta-2015-budge...impact-buyers/

[Boris2k7]

Originally Posted by Jaws

As of Jul 1, 2015 there was going to be a land transfer tax brought in by the PCs, but the NDP won the election and it didn't proceed. The only thing the NDs have done that hasn't cost me more money.
http://dbblaw.com/alberta-2015-budge...impact-buyers/

Yeah, seeing as how I bought last year, I would've stood to lose a ton of money if the PCs had stayed in, whereas I'm financially much better off with the NDP.

[speedog]

Originally Posted by lio45

You probably did, you just don't recall it. Every single one of the four jurisdictions I bought stuff in on this continent had some form of transferring fee / stamp / deed / recording fee (name may vary, but it's the same concept). However, sometimes, it may be paid by the seller, not the buyer, it depends what gets agreed upon.

Not in Quebec, though. Quebec is the only case I know (as opposed to the other three) where this tax only gets billed to you later, by your municipality, instead of being part of the closing at the notary's / title company's.




Ontario + checking the "I'm in Toronto" box is indeed shockingly high. (I thought Quebec was already very high, at ~1% of the purchase price.) I haven't played with the settings / other provinces (except for confirming Alberta is pretty low), is there even worse than that out there?

Alberta's is just a fee, not a tax as best as I've been able to figure out. One could call Alberta's a tax of sorts I suppose, it's been over 20 years since I purchased property so details from back then are quite foggy.

[speedog]

Originally Posted by lio45

How exactly do you define a millenial? I was born in the 1980s, and own a bunch of property... started in 2005, nearly 12 years ago already.

Trailer park homes don't count, eh.

[Architype]

Originally Posted by vid

"Wait, you own your house????" -Millennial

"I own many houses!" -Born Before 1980

"*dies*" -Millennial

If you're in No. Ont. property must still be cheap (read, "under a million"), so it shouldn't be too hard to buy.

[mistercorporate]

Originally Posted by lio45

How exactly do you define a millenial? I was born in the 1980s, and own a bunch of property... started in 2005, nearly 12 years ago already.

Come on dude, you inherited a successful family business if i recall correctly, not like you started from scratch scraping pennies together living independently in some random grimy basement apartment

[WhipperSnapper]

Originally Posted by esquire

Ugh. LTT started out as an administrative fee that has morphed into a big cash cow for government. The problem in Manitoba is that the values are still pegged to a 1990s reality when a nice family home was $95,000 and a luxury robber baron abode cost an exorbitant $500,000. It was set on the assumption that sales of $500,000 luxury homes would be rare and that those infrequent wealthy buyers could carry the lions' share of the burden. The problem is that these days, a huge proportion of SFHs and even condos sell at prices that would have been the exclusive domain of luxury dwellings 20 years ago. That leads to these absurdities in Manitoba:

$100,000 home - $400 (OK, fine, cost of doing business)
$200,000 home - $1,650 (why does it cost 4x more to process the transaction of a house only double the value?)
$400,000 home - $5,650 (this is getting stupid)
$600,000 home - $9,650 (gtfo)



It's a significant financial burden for nothing more than the act of buying a home.

It's a progressive tax. The more value, the more you pay. The pegged values are even more unrealistic in Toronto. Anything over $400,000 pays the maximum and virtually nothing is available under 400K.

I'd be gleefully laughing if I only had to $9,650 for a 600K home in Toronto. It's closer to $25,000.

[esquire]

Originally Posted by WhipperSnapper

It's a progressive tax. The more value, the more you pay. The pegged values are even more unrealistic in Toronto. Anything over $400,000 pays the maximum and virtually nothing is available under 400K.

I'd be gleefully laughing if I only had to $9,650 for a 600K home in Toronto. It's closer to $25,000.

I have no problem with a progressive tax, but the issue is that the land values are horribly outdated here (admittedly, it sounds like it's way worse in Toronto). At the very least the values should be re-indexed so that someone buying a fairly modest new subdivision home here for $500,000 isn't getting clobbered with maximum LTT.

[kwoldtimer]

Dumb question - are land transfer taxes notionally FOR anything in particular, or are they just a general revenue generating mechanism?

[esquire]

Originally Posted by kwoldtimer

Dumb question - are land transfer taxes notionally FOR anything in particular, or are they just a general revenue generating mechanism?

I recall the realtors here ran an unsuccessful lobbying campaign against the current form of the LTT a couple of years ago. They implied that it existed as a way to pay for the administrative overhead associated with processing title transfers, etc., but that it grew into a general revenue cash cow.

I'm not sure how accurate the first part of that was as I wasn't yet around when it happened, but the second part is undeniably true.

[WhipperSnapper]

Originally Posted by esquire

I have no problem with a progressive tax, but the issue is that the land values are horribly outdated here (admittedly, it sounds like it's way worse in Toronto). At the very least the values should be re-indexed so that someone buying a fairly modest new subdivision home here for $500,000 isn't getting clobbered with maximum LTT.

Of course. I also appreciate it's hard to keep things up to date with real estate nowadays. I'm really not opposed to land transfer taxes except for first time buyers not receiving a full rebate. (by being in the highest bracket) It hurts but, I'm still making money.

[SHOFEAR]

Originally Posted by vid

"Wait, you own your house????" -Millennial

"I own many houses!" -Born Before 1980

"*dies*" -Millennial

"Yeah, well when I bought a house in 1979 it came with carpet and linoleum, not granite countertops, steam showers. Oh and those fancy fridges with water and ice dispensers and other expensive energy efficient appliances that are underpowered and burn out after 5 years....." - Born before 1980

"keep raging against sprawl millennial.....get more stuff tossed into the cost of servicing land...that's not helping affordability" - Born Before 1980

"oh" -Millennial that wants everything

"but you still took a few months off work when you changed jobs every three years because you wanted to work for a company that provided better live/work balances to take a long backpacking trip across Europe or SE Asia" - Millennial

"nope, we were given the parents old tent and went camping near Jasper during long weekends" - Born Before 1980

"ok, but you brought $8.00 a bottle trendy microbrews with you for the weekend right" - Millennial

"nope, a flat of Canadian" - Born Before 1980