In regards to real estate, HST was only applicable on the purchase of new property. As of the week of August 22-26th 2011, the HST and its’ 12% tax rate was voted out, and the new 5% GST will take effect in 2013.
So don’t buy any real estate for two years!! You’ll automatically save 7%! No doubt about it. Right? No one else will have that same idea. Genius. Although…what if a lot of people have that idea? And then 2013 hits and a bidding competition is created as a result. Not to mention the possible increase of prices due to demand.
Aside from the possibility of that scenario happening, there is also the feasible chance of at least a 7% increase in the Vancouver real estate market over the next two years, if it continues its’ new millennia trend.
Another interesting scenario, for example, is if a new project completes in 2012 before the turnover
back to 5% GST, will a developer be able to allow the buyer to delay completion
until 2013, yet still allow the buyers to tenant the property as soon as it
receives its’ occupancy permit in 2012?
Only time will tell if there will be any quick and easy solutions. And I just wanted to provide some scenarios to think about as to prevent prejudgements.
Hope everyone enjoyed the long weekend!
As always, feel free to contact me if you have any questions.