Government reduces tax burden on first-time buyers
The government announced today a tax break for first time Buyers on the Property Transfer Tax (PTT) effective February 19, 2014. Qualifying first-time home buyers can now buy a home worth up to $475,000, the previous threshold was $425,000. The partial exemption continues and will apply to homes valued between $475,000 and $500,000.
The government estimates 1,700 additional first-time buyers will annually be eligible to save up to $7,500 in PTT when they buy their home and estimates the cost in lost tax revenue to be $8 million per year.
Both the Real Estate Board and Association have actively lobbied to make home ownership more affordable for first-time home buyers. This increase in the threshold clearly signals thier efforts have paid off as in past years like in 2008 - the threshold to $425,000 from $375,000 and in 2005 - $325,000 from $275,000.
The PTT is calculated at a rate of one per cent on the first $200,000 and two per cent on the remaining value of the purchase price.