58% of Ontarians still mistaken about HST and resale homes
Ontario Real Estate Association calls on government to address confusion about HST
TORONTO, Oct. 26, 2011 /CNW/ - An Ontario Real Estate Association (OREA) survey reveals that confusion about the Harmonized Sales Tax (HST) and buying a resale home has not decreased in the last year despite efforts by the provincial government and real estate industry to educate the public.
The survey conducted by Ipsos Reid shows that 58 per cent of Ontarians mistakenly believe the HST is applied to the purchase price of a resale home versus 56 per cent who believed the same in an identical OREA/Ipsos survey conducted last fall.
"It is discouraging to see the confusion about home buying and the HST has not reduced in the past year," says Barbara Sukkau, president of OREA. "Our members are working very hard to inform their clients about home buying and the HST, but we are asking the government to do more to educate the public," says Sukkau
Since the introduction of the HST, the Ontario government has created a website to inform consumers about the changes to tax system and has worked with OREA on a video with the former Minister of Revenue, prior to the ministry becoming part of the Ministry of Finance, to explain the facts about home buying and HST. On its own, OREA has produced its own video about HST confusion and has worked with its members to inform the public about this topic.
"Obviously the government's efforts, and our own, have not been enough to dispel this myth. The HST does not apply to the purchase price of a resale home. It only applies to transaction fees associated with the purchase of a resale home, such as Realtor fees and legal fees," says Sukkau.
According to the new survey, people living in northern Ontario (66 per cent) and the GTA (60 per cent) were the most likely to believe that HST applied to the purchase price of resale homes, while those living in central Ontario (50 per cent) were the least likely. The full results can be found at http://bit.ly/HSTsurvey.
With the average Ontario home selling at just under $350,000 in August 2011 (Canadian Real Estate Association), potential home buyers may wrongly assume a resale home costs an additional $45,500 more than it does. "If buyers overestimate the cost of a resale home, they may be reluctant to even contact a Realtor to see what's available in their area and miss a great opportunity," says Sukkau. "Studies have shown that homeownership provides not only financial benefits as an investment, but social benefits as well. Homeowners take pride in their property and bring stability to a neighbourhood, so it's vital to our communities that Ontarians accurately understand the costs associated with buying a home."
OREA also conducted a survey of its members to see if confusion about the HST has had a negative impact on home sales in the last year. Almost half (48 per cent) of the Realtors surveyed said that consumers seemed to be somewhat confused about whether HST was applied to the purchase price of a resale home. Also when asked, 79 per cent of Realtors said that they believe the HST has had a very or somewhat negative impact on the housing market.
"For now, if someone is thinking of a new home and has questions about whether or not the HST is applied to the purchase price, they should speak to a Realtor in their community for advice," says Sukkau. More information about the cost of buying a home can be found at howrealtorshelp.ca.
Ipsos Reid poll conducted the survey among 813 Ontarians from Ipsos' Canadian online panel, between September 15 and 19, 2011, on behalf of the Ontario Real Estate Association. The estimated margin of error is +/- 3.5 percentage points, 19 times out of 20.
OREA's online research panel sent email invitations on July 29, 2011 to 2,717 panel members. Two reminders were issued and the field closed August 12, 2011. A total of 1,199 panel members responded (44 per cent).
About the Ontario Real Estate Association
The Ontario Real Estate Association represents 50,000 brokers and salespeople who are members of the 42 real estate boards throughout the province. OREA serves its REALTOR® members through a wide variety of professional publications, educational programs, advocacy, and other services. OREA.comFor further information:
To book an interview with Barbara Sukkau, president of the Ontario Real Estate Association please contact:
Thornley Fallis Communications
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