While fees will increase dramatically, levels are still lower than other provinces
As the Calgary real estate market continues to deal with the impact of low oil prices, there was one piece of unwelcome news for potential homebuyers. According to the Calgary Herald, registration fees for new homebuyers are set to increase dramatically with the recently announced provincial budget. While fees for some homebuyers could even quadruple, experts are quick to point out that registration fees in the province will still remain well below the Canadian average. Additionally, although the city’s real estate market has slowed down, analysts say the higher fees will likely not be a significant barrier for most property buyers.
Contained in the provincial budget was the announcement that on July 1 the flat-fee portion for land title registration and mortgage registration fees, which are both currently $50, will rise 50 percent to $75.
However, the variable fee part of land title and mortgage registrations will see an even more dramatic increase. The Calgary Herald gives the example of a $500,000 new home purchased with a $400,000 mortgage. Under the current system, the land title and mortgage registration cost $150 and $140 respectively, or $290 in total. With the new variable fee hikes, however, starting July 1 the land title and mortgage registration fees would go up to $675 and $555 respectively, for a new total of $1,230.
FEES STILL LOW
Such a dramatic increase is not likely to be welcomed by many new homebuyers, but real estate experts say that the market can probably absorb the increase. As CBC News reports, although activity in the Calgary market declined considerably this March compared to March of 2014, home prices themselves only declined by 2 percent. High-end properties dropped in value much more than mid-range ones, suggesting the overall market remains somewhat stable.
Homebuyers can also take comfort in the fact that while the fee increases announced in the budget are dramatic, overall fees are still competitive in Alberta compared with the rest of the country. The Calgary Herald notes that the same $500,000 new home described above would be hit with a $12,200 transfer tax in Toronto or $8,000 in Vancouver.
SELLING OR BUYING
Buying or selling a home is a big experience in just about any person’s life. With so much at stake, it is important to make sure everything is done right in order to avoid any unwanted surprises coming up in the future. An experienced real estate lawyer can help homebuyers or sellers deal with the legal side of any real estate transaction, thus adding peace of mind and guidance to one of the biggest financial decisions of most people’s lives.