This article is mainly for originators in NS, but it is of interest to everyone. The NS Government is rolling out a tax rebate for new construction homes. This is on the heels of the new CMHC stats that show new home starts are down 30%. Good timing me thinks. The article is from today’s Halifax Chronicle Herald.
NDP rolls out rebate for new houses
By DAVID JACKSON Provincial Reporter Thu. Aug 13 - 6:12 AM
Home builders and homebuyers stand to benefit from a new tax break, Premier Darrell Dexter said Wednesday.Buyers of newly constructed homes can now apply for a 50 per cent rebate on the provincial portion of the harmonized sales tax.It’s a program the Nova Scotia Home Builders’ Association suggested to the three major political parties before the spring election.The NDP put the program in its platform, but with a start date of May 1. The government has changed it to Jan. 1, at the association’s urging. A maximum of 1,500 rebates will be offered.To qualify, buyers of new homes must have a municipal building permit dated on or after Jan. 1, 2009, and before April 1, 2010. The home must be the primary residence and construction has to be completed between Jan. 1, 2009, and March 31, 2010, or the purchase closed by March 31, 2010.Cottages and income properties don’t qualify.Mr. Dexter said the government changed the start date because the association was concerned that homes started between January and May might not have sold because the tax break came later in the year.“They indicated that they had been working through the winter, trying to keep people employed, so . . . there were a large number of building permits between Jan. 1 and the May 1 date. The result of that, of course . . . potentially, would have been to strand that inventory," Mr. Dexter said.Speaking at a Dartmouth townhouse construction site, Mr. Dexter said there were about 600 permits issued in the province between January and May, although he didn’t know how many homes were under construction. Opposition leaders said the tax incentive sounds more like a reward.“I don’t see it stimulating any activity that otherwise wouldn’t have happened," Liberal Leader Stephen McNeil said.Mr. McNeil also said he is skeptical whether a $7,000 benefit will be enough to entice people making a $200,000 or $300,000 purchase. And he wondered whether home builders would increase their prices, negating the benefit of the tax break to the buyer.Mr. Dexter said buyers will negotiate their prices, and he thinks competition will take care of Mr. McNeil’s concern.“There are a lot of companies out there that are really looking to get work, so I expect there to be a very competitive market, and that this rebate will ultimately benefit those who are intended to benefit," he said.Interim Tory leader Karen Casey said people now looking at buying a new home may be concerned that the 1,500 rebates will be gone by the time they apply.Service Nova Scotia Minister Ramona Jennex said at the news conference that the website www.getyourrebate.ca will track the number of applicants and rebates.Ms. Casey said the original intent of the program — to spur economic activity and keep tradespeople working — was good, but that doesn’t seem to be happening.“I consider this now a reward, rather than an incentive," she said.Andrew Holley, president of the home builders association, said he would have preferred the qualifying date go back to October, but he was still pleased with the new program.“We didn’t get everything that we wanted, but it was a good compromise," Mr. Holley said.Mr. Dexter said the NDP did its own due diligence on the proposal and decided the province could do it.The province would forgo $10.5million if the maximum number of people gets the top rebate.The maximum — $7,000 — kicks in for homes costing $175,000 or more.“I don’t think there’s anything wrong with listening to the stakeholders who are involved in the industry, and thereby turning the wheels of the economy," Mr. Dexter said.“That’s really what we’re here for, to try and make sure that we get through what is a very difficult economic time, try to recognize the importance of the residential construction sector and make sure that we keep tradespeople working."Mr. Holley said more than 20,000 people work in the residential construction industry across the province, while new housing accounts for more than $800 million in annual revenue.A Canada Mortgage and Housing Corp. report released this week said housing starts, which include apartment buildings, were down close to 30 per cent in the province during the spring and early summer. In Halifax, the decline was 44 per cent.Housing sales, provincewide, were also down by 14.5 per cent when compared to the same period last year.
More information is available at www.getyourrebate.ca, or by calling 424-5200 in the Halifax region or toll-free 1-800-670-4357.(djackson@herald.ca)
