Hi every one, it's Leah Coss with the Mortgage Centre and I want to talk about Property Transfer Tax, because there are lot of people who are confused about what it is, why they have to pay, when they don't have to pay it, how much to pay and things on that nature. I'm just going to quickly run through on the generalities of Property Transfer Tax here in British Columbia, Canada.
Property Transfer Tax, how much do you have to pay? Well, it's one percent of the first 200,000, so two grand, and two percent of every hundred thousand after that. If you're buying a $400,000 place, that's $6,000 if you do the math, OK? So, a bit of a chunk of cash for some of you. When do you not have to pay it? Never. You always have to pay it unless you're a first time homebuyer.
There are some very specific conditions to that, even first time home buyers have to pay Property Transfer Tax sometimes. Here are the situations where they have to. At this point in time, if you buy a house over $425,000 as a first time homebuyer, you will have to pay all of, or at minimum, a portion of Property Transfer Tax. Basically, it's anything above 425,000, you have to pay Property Transfer Tax, but its sliding scale between 425 and 450.
If you buy a house over 450, you're paying full amount of Property Transfer Tax. If you buy it between 425 and 450, it's like a sliding scale amount and it's all confusing, so don't anymore worry about that. If you purchase a house under 425 and you're a first time homebuyer, and you never had your name on the title of a home here in Canada, then you will not have to pay Property Transfer Tax that one time. OK?
But... [handclap] If you're a first time home buyer, and you're buying a rental property, because you maybe still live at home with Mom, or you're still renting because it's a good situation, you have to pay Property Transfer Tax on that rental property, but when you go to buy you're first owner occupied property, now your first time homebuyer kicks in.
Those are the main situations where you're going have to pay it, how much you're going to have to pay. The reason for Property Transfer Tax is simply the [laughs] taking your name off title and putting it on to a new title. That's the general speaking of what Property Transfer Tax pays for, I'm sure they do a lot more behind the scenes, a little pricey, in my opinion.
I think the 425 threshold for first time homebuyers needs to be upped, because in Vancouver, that hardly buys you a condo anymore. If you have questions about Property Transfer Tax, or any other closing cost, definitely check out my other videos first, I've got lots of closing cost videos out there for you. If you have more questions, feel welcome to give me a call.
If you have a situation where maybe it's you and a friend, or you and your spouse, who are buying, and one of you is a first time homebuyer and the other one isn't. You want to figure a way not have to pay as much Property Transfer Tax, I can tell you some more specifics on those options for you, so definitely give me a call. I'm Leah Coss with the Mortgage Centre, a Canadian mortgage broker, I cannot help you people in the US, I am very sorry. Check out a mortgage broker in your area.
If you any questions, leave a comment, send an email, give me a call, don't forget to subscribe. Those are my dogs freaking out in the background, it's not someone ripping someone's throat apart. [laughs] Quiet guys. Anyway, don't forget to subscribe, so you don't miss this videos, and hopefully I can help you out. Leah Coss from the Mortgage Centre, I'll talk to you soon.