Currently there are many factors within the mortgage industry that are making it harder to purchase homes. Guidelines regarding credit scores and credit worthiness have become strict and lenders are requiring larger down payments from just about everyone in order to purchase in the present day market. On the other hand, for those that can qualify for a mortgage loan, there are many great incentives going around to make it easier and more affordable for people to buy homes, including lower interest rates, MCC trax credits, First Time Home Buyer Tax Credits, etc....

For some reason a few legislators believe that adding a transfer to tax to the sale of real estate will be beneficial to us all(or maybe just to themselves, I am not sure why). They are proposing a tax to be paid that will add to the cost of purchasing a home. While we are supposedly in a recession and it is difficult for many people to make the leap into purchasing a home at all, why would any one think that adding more taxes to a real estate transaction be a good idea?

It's not! It's a horrible idea and we need to make sure it does not pass into law in the state of Texas. Read up on it and demand that it be shot down.

More details:

Real estate transfer tax filed in Senate

Sen. Jeff Wentworth of San Antonio  filed SB 942, which allows counties to enact new taxes to increase revenue for local transportation projects. One of the new-tax options that would be made available to counties is a real estate transfer tax to be paid to the county within 30 days of the transfer of property. The bill allows the county to set the rate of the transfer tax and mandates sales-price disclosure to ensure that the proper tax was paid.

Background

The NAR®(National Association of REALTORS®) commissioned a study to analyze the effects of a transfer tax on real estate. The report assumed a tax rate of 0.5% and a $125,000 purchase price. Based on these assumptions, the cost of buying a home would increase by about $600, and home sales would decline by almost 3%. This bill, however, allows the county to set the tax rate, so homebuyers could see a larger cost increase and sales could decline more than 3%. Additionally, the Real Estate Center at Texas A&M University concluded that the creation of a transfer tax on real estate may create more problems than it solves, costing the state $955 million in lost economic activity with 11,575 jobs eliminated.

*(this passage taken from TAR Political Actions Committee Newsletter-Author unknown)*

Meet the blogger:

My name is Ozzie Ramirez, I am the founder of AskOzzie.com. As part of my duties as a founder and a recruiter I work on the Political Actions Committee within the Houston Association of REALTORS®. As a member of the PAC, it is my job to make sure that  real estate is protected as it effects the every day consumer, my clients. I work in real estate everyday. It is my profession, and my livelihood, and I try my best to keep this site up to date with the most current issues regarding the Pearland and Greater Houston Real Estate Markets. Hopefully this web site will help to educate you and help make your next real estate transaction a more positive one. Feel free to contact our staff at Capital Trust Realty and AskOzzie.com if you have unanswered questions, comments or if you would like to enlist the help of a licensed real estate professional.