All BC residents should be familiar with the governments tax fiasco – the HST. Voters repealed the unpopular tax in an historic referendum in 2011 and the HST is slated to be repealed by April 2013. This is great news for the New Home Industry which saw a 7% tax increase, not to mention the additional 7% increase in real estate commissions, legal fees…even a cup of coffee. The Provincial government has enacted 2 new programs designed to offset the effect of the HST on New Home Sales until the return to the Provincial Sales Tax (PST) system.
The first important announcement was a move to increase the upper tax-rebate limit from an ineffectual $525,000 to $850,000 – great news for a market with an average single family home price of over $579,000.
The other important announcement, and the one which will probably have the greatest influence in the current market is the announcement of a $10,000 Tax Bonus for first-time homebuyers that purchase a newly constructed home; a huge boon in a market with a large availability of new condominiums, and where wise developers are capitalizing on the marketing advantages of constructing single-family homes under $425,000 to appeal to savvy first-time buyers looking to escape the much criticized Provincial Property Transfer Tax. Many industry professionals agree that the entry-level homes will continue to drive the Greater Victoria and Vancouver Island housing market through 2012.
Check out this informative video spelling out all the requirements and benefits:





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