There have been a lot of changes recently that affect the home buying process for some consumers. One new rule that may have been overlooked by some is the new Land Transfer Tax rule. I just read an article written by Real Estate Lawyer Mark Weisleder where he outlines these new rules. The November 18th email comes with a video that you can check out on youtube but I have outlined the highlights for you here.
First, effective January 1st, 2017, the rebate that first time home buyers can claim will be increased from $2,000 to $4,000! The main thing to watch is that your home purchase must actually CLOSE after January 1st. If you close on Dec 28th or 29th, you are not eligible for the increased rebate.
Second, if you are not a Canadian Citizen or permanent resident, then you don’t qualify for the rebate. If your status changes within 18 months following closing on a house purchase then you can apply for that rebate.
Third, the Land Transfer Tax that is charged will be increasing on January 1st. The most significant increase affects the purchase of a commercial, industrial, apartment building or piece of vacant land over $400,000. The LTT is increasing from 1.5% to 2%. If you buy a house that costs more than $2M, the LTT increases from 2% to 2.5% for every dollar over $2M!
The final item that Mr Weisleder mentions is a reminder about the fact that if you are buying a home in Toronto, you will also be subjected to Toronto’s Municipal Land Transfer Tax. This makes buying a home in Toronto more and more expensive every day!
Land Transfer Tax rules can be very confusing. We’d love to answer your questions and hear your comments. You can reach John Weber at John@JohnWeberTeam.com or by cell at 705-727-6111. You can reach Christie Bond at Christie@JohnWeberTeam.com or by cell at 705-220-1152.